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TMI Blog2014 (3) TMI 718X X X X Extracts X X X X X X X X Extracts X X X X ..... ovember 1996 to April 2006. He only looked into the wastage for the financial year 2002-2003. When he made a finding that no records were maintained by the appellant to establish generation of waste and scrap, quantum of goods destroyed does not provide any basis to pass a summary order by him. His order is not self speaking. Appellant after providing information for solitary period again requested to ignore the same having mistakes crept therein. No records being maintained by the appellant to provide year wise reconciliation, ld. Authority should have carefully examined quantum of import of input and issue thereof for use in manufacture, arise of output out of such manufacture and quantum of loss occurred in the process in each case to ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacture of finished goods. Out of such issue, 65,52,285 pcs of cannulae and 3,26,64,788 pcs of needles were claimed to be waste and scrap. 2. Repeated requests were made to appellant to provide year-wise details of Needles and Cannulae imported duty free and waste and scrap generated in manufacturing of finished products for the period 1996-97 to April, 2003. But appellant provided details in respect of Cannulae only for the period 1997-98 to 2001-02 and no details were provided in respect of needles. Summons dated 13.01.2006, 24.01.2006 and 02.02.2006 were issued to call for information from the appellant. But that was in vain with the above outcome. By letter dated 01.12.2005 appellant informed that some wrong information was submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticles) even if not exported out of India, are allowed to be sold in India, in accordance with the Export and Import Policy, on payment of duty of excise leviable thereon under Section-3 of the Central Excise Act, 1944 or where such articles (including rejects, waste and scrap material) are excisable, on payment of Customs duty on imported goods used for the purpose of manufacture of such articles in an amount equal to the Customs duty leviable on such articles, as if imported as such. 5. In the light of above, it was held that customs Duty was leviable on excess waste/scrap generated beyond 5% admissible limit. Ld. Authority also relied on Para-114 of EXIM POLICY 1992-97 and para 9.20 EXIM POLICY, 1997-2002 to disallow the wastage clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opined by ld. Adjudicating Authority that excess waste and scrap claimed to have been generated beyond norm was not permitted to enjoy exemption benefit for which appellant was liable to pay Customs duty forgone on such excess wastage of imported duty free. Appellant never informed the department regarding the excess generation of waste/scrap beyond permissible limit of 5%. Accordingly provisio to Section 28 of Customs Act, 1962 for the extended period was invoked for violation of condition of LOP dated 22.09.95 read with Notification No. 53/97-Cus dated 03.06.97 for imposition of duty. It was also held that Appellant was liable to penalty under Section 117 of the Customs Act, 1962. 7. Appellant s plea that debonding was allowed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ousand only) was imposed on the appellant under Section 117 of the Customs Act, 1962. 10. Appellant argued that there is no whisper in the Show Cause Notice about diversion of the import. 5% of the quantity of the goods imported was allowed as waste under law. When the process carried out by the appellant resulted with some loss, the authority should have appreciated such natural loss that had occurred in the course of manufacture. Further, the demand raised in adjudication is barred by limitation. Appellant also relied on the certificate of destruction issued on 12.03.2004 which according to appellant shows that there was arise of waste and scraps in the course of manufacture which were destructed and such loss is within the limit for w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itary period again requested to ignore the same having mistakes crept therein. No records being maintained by the appellant to provide year wise reconciliation, ld. Authority should have carefully examined quantum of import of input and issue thereof for use in manufacture, arise of output out of such manufacture and quantum of loss occurred in the process in each case to apply the low. A sketchy picture was drawn by him without year wise analysis. When there is fraud against Revenue no plea of time bar is available to appellant following the ratio laid down in CC Vs. Candid Enterprises reported in 2001 (130) ELT 404 (SC) since fraud nullifies every solemn act. 14. Keeping the observation above in view, the matter is remitted back to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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