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TMI Blog2013 (8) TMI 689X X X X Extracts X X X X X X X X Extracts X X X X ..... ustainable barring the penalty imposed u/s 112 of Customs Act, 1962 and penalty imposed under Rule 173Q. Extension of Warehousing Period - Whether the Extension of the warehousing period was not proper - Held that:- Extension of warehousing period cannot be found fault with - The Unit was not having any control on the circumstances wherein the technology had undergone changes and new Montreal Protocol and they could not cope up with new protocol in this kind of industry - the circumstances in this case were not exceptional in nature - Further Section 69 of Customs Act, 1962, provided for export of warehousing goods without payment of import duty subject to certain conditions - It was not the case of the department that the Unit had not fulfilled the said condition - The export/removal of the goods had been as per the provision of Chapter IX of the Warehousing and the department could not bring out the condition which were not fulfilled or any provision had been contravened - the goods were not liable for confiscation – Decided against Revenue. - C/1026/2009-Mum and E/991 & 1095/2009-Mum - A/640-642/2013-WZB/C-I(CSTB) - Dated:- 16-4-2013 - Shri Ashok Jindal and S.K. Gaule, JJ. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt obligation and the conditions of exemption Notification No. 13/81-Cus. and 21/95 for the recovery of customs duty and excise duty along with interest under Section 28AA of the Customs Act and Section 11AA/11AB of the Central Excise Act, 1944 and with a proposal for confiscation of imported capital goods and a proposal for penal action. The notice was adjudicated by the Commissioner vide order dated 27-5-2004. The said order was set aside by this Tribunal vide Order No. A/11-12/2007/CSTB/CI, dated 21-12-2006 on the ground of violation of principle of natural justice and the case was remanded to the Commissioner for de novo consideration. Thereafter the learned Commissioner vide his order 1/MS (01) Commr.Rgd./07-08, dated 4-4-2007 confirmed the demand of duty as raised in the notice along with interest and Central Excise duty on the capital goods imported and indigenously procured by the Unit and imposed equal amount of penalty under Section 114A of Customs Act, 1962 and Rule 25 of Central Excise Rules, 2002. The unit challenged the same before this Tribunal. This Tribunal vide Order No. A/413-414/2008CSTB-C-I dated 11th July, 2008, while observing that the Revenue has not brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Jt. Development Commissioner conclusion has been received for necessitating the confirmation of demand, whereas the learned Commissioner has erred in not confirming the Central Excise and Customs duty demand by allowing the re-export. Vide para 26.3 of the order-in-original the Commissioner has rightly held that the Unit have not fulfilled the conditions of Notification 13/81-Cus. as amended. It was necessary to confirm the demand unconditionally. The contention is that the Board s Circular No. 30/99-Cus., dated 25-5-1999 calls for demanding duty and interest from the units who fails to instal or use or re-export the capital goods within a period of one year from the date of importation or procurement or within the extended period as may be allowed by the Asstt. Commissioner. In this case the goods were not installed nor even used. Similarly, Board Circular No. 851/9/2007-CX, dated 3-5-2007 provides for punitive action. The contention is that the subject-matter of EOU, who are exiting from the scheme are required to pay excise and customs duties as per Chapter 6.18 of the Foreign Trade Policy. The contention is that the Commissioner in his impugned order extended warehousing provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia signed the Montreal Protocol an agreement to phase out Ozone Depleting Substances i.e. CFC and switch over to HCFC. They were advised by the foreign collaborator that containers using CFC will not be accepted by customers in Europe and USA from 1996 onwards. Being a 100% EOU, the Banks also agreed and they were forced to switch over to use of HCFC. The changeover resulted in cost overrun of Rs. 738.98 lakhs and the banks took up appraisal for overrun financing. The original project cost which was estimated at Rs. 1522.72 lakhs went up to Rs. 2261.69 lakhs an increase of Rs. 738.98 lakhs. They also purchased indigenous machinery. Though such machinery was assembled at a stage they ran out of funds and could not import the additional machinery required to complete the project and accordingly, approached for additional fund and they were getting the LOP renewed from time to time. Finally this did not materialize and they decided to close the project and they started looking out for overseas buyers for the machinery. For this they are required to extend the warehousing licence and they approached to the appropriate authority. 5.1 The contention of the unit is that licence for pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e following cases :- (a) Siemens Public - 2001 (137) E.L.T. 623 (T) (b) Order No. A/82-84/13/SMB/C-IV, dated 7-1-2013 in the case of M/s. Cipla Ltd. v. CCE, Nhava Sheva. The contention is that the learned Commissioner has rightly extended warehousing period for the purpose of re-export. 6. We have carefully considered the submissions and perused the records. 6.1 The grievances of the department in the case are that the extension of the period were not in accordance with the provision of Section 61 of Customs Act, 1962, and duty should have been demanded unconditionally. The goods should have been confiscated under Section 111(o) and penalty should have been imposed under Section 114A of Customs Act, 1962. For appreciation of the aspect whether the requirement of Section 61 has been met or otherwise the relevant provisions of Section 61 of Customs Act in vogue at the material time are reproduced here : (a) Sub-section (1) of Section 61 of Customs Act, 1962, in vogue upto 11-5-2002 : 61. Period for which goods may remain warehoused. - (1) any warehoused goods may be left in the warehouse in which they are deposited or in any warehouse to which they may be remove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r such period as he may deem fit; and (B) in the any other case, by the Commissioner of Customs, for a period not exceeding six months and by the Chief Commissioner of Customs for such further period as he may deem fit; (ii) in the case of any goods referred to in clause (b), if they are likely to deteriorate, the aforesaid period of one year may be reduced by the Commissioner of Customs to such shorter period as he may deem fit : Provided further that when the licence for any private warehouse is cancelled, the owner of any goods warehoused therein shall, within seven days from the date on which notice of such cancellation is given or within such extended period as the proper officer may allow, remove the goods from such warehouse to another warehouse or clear them for home consumption or exportation. 6.2 Another grievance of the department is that the extension of the warehousing period was not proper and the circumstances in this case were not exceptional in nature. We find that the Unit was not having any control on the circumstances wherein the technology has undergone changes and new Montreal Protocol and they could not cope up with new protocol in this kind of indu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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