9911796707
TMI Blog2012 (6) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... c Zone, Rules, 2003. During the period 17.6.2005 to 20.6.2005, the officers of the Customs, KASEZ carried out stock verification of various goods imported by the appellant and found that there were shortages. For such shortages, the customs duty forgone was Rs. 14,67,705/-. Coming to the conclusion that the said amount is recoverable, show cause notice was issued for demand of said duty and interest thereof and also imposition of penalties. The appellant contested the show cause notice on the ground that the shortage of goods which was noticed by the officers was destroyed in a fire accident which broke out in their unit on 13.6.2005 and they sought remission of the customs duty foregone by the Revenue. The adjudicating authority did not ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation authority has considered the provisions of Rule 12 of SEZ Rules, 2003 and regulation 28 of SEZ (Customs Procedure) Regulations, 2003 to hold that the appellant s case is not covered by the said provisions and hence the goods destroyed due to fire, having not been put to use for the intended purposes, the appellant is liable to pay the Customs Duty foregone. We do not find any merits in the reasoning given by the adjudicating authority for more than one reasons. First and foremost, since there is no dispute that there was a fire accident in the appellant s factory and the goods were destroyed and the departmental officers were informed of such fire accident, demand of customs duty foregone does not arise as the goods were in the factor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the fire was manmade or there was a mala fide intention or it was not accidental. Rule 8 provides for charging of duty when the goods imported/procured are utilized for the purposes other than authorised operations or failure to account for the goods. In this case it cannot be said that goods were utilized for purposes other than authorised operations since the expression used clearly means a deliberate utilization or misuse of the goods procured duty free for unauthorized operations. When there is an accidental fire resulting in destruction of goods, it cannot be said that it amounts to use of goods for unauthorized operations. Similarly the second term namely failure to account for also cannot be applied since the shortage has be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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