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TMI Blog2015 (1) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... tion that SPPML has further diverted the 1275.201 MT of ‘Waste Paper’ received by them from the appellant. There is no allegation that SPPML has not manufactured newsprint from the 1275.201 MT of ‘Waste Paper’ received by them from the appellant. The appellant has submitted a certificate dated 9-4-2014 duly certified by Chartered Accountant; certifying that the impugned goods of 1275.210 MTS of waste paper was received by SPPML and consumed in the activity of making newsprint. The substantive condition of the notification is the specified use of the imported goods and to verify the compliance of this substantive condition procedural condition of Sr. No. 20(b) was specified. It is proved beyond doubt that the appellants have complied the substantive condition of the notification. The show cause notice of the present case itself stands as certificate in this regard. Therefore, exemption of the Basic Customs Duty provided by the Notification No. 21/2002-Cus., dated 1-3-2002 as amended cannot be denied. Goods are not liable for payment of differential customs duty and confiscation. Since, there is no confiscation of goods and demand of differential duty is also not sustainable, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting to ₹ 10,34,744/-, imposed a penalty of ₹ 10,34,744/- on appellant No. 1 under Section 114A and penalty of ₹ 1,60,000/- on each of the appellant Nos. 2 and 3 under Section 112 of the Customs Act, 1962. 4. The Department in its comments F. No. S/26-Misc-75/09 Gr.IIB/S/10-Adj- 12/10 Gr. IIB, dated 8-10-2010 stated that the appellants have admitted to have the imported goods i.e. waste paper exchanged with SPPML, without informing Central Excise Authority, in violation of existing rules. The appellants thus violated the conditions of the Notification No. 21/2002-Cus., as they failed to use the goods for specific intended purpose. 5. The appellants had earlier filed appeals seeking waiver of pre-deposit of duty, fine and penalty on the ground that they had a strong prima facie case as there was no suppression of facts and no duty was payable on unusable waste. The appellants contended that the deposit of duty, fine and penalty may be waived as only 4-5% unusable waste was diverted, the goods were not available for confiscation and the impugned order was non-speaking. Considering the fact that appellants had diverted the impugned goods violating the end-use c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 25-2-2014. Shri Sujay Kantawala, advocate appeared before me on behalf of the appellants and reiterated the grounds of appeal and the modification application in the case. The appellant in their written submissions, dated 4-2-2014 has stated that the subject Notification No. 21/2002-Cus. was amended w.e.f. 9-7-2004 to split the single entry at Sr. No. 152 into :- (A) for manufacture of paper or paper board other than newsprint (B) for manufacture of newsprint. The appellant has thus contended that there is no basis for denial of the benefit of Notification No. 21/2002-Cus., dated 1-3-2002.The appellant in their further submissions, dated 15-4-2014 submitted certificate from a chartered accountant certifying as to the usage of the impugned goods for the manufacture of newsprint. They further submitted that the impugned goods were not available for confiscation and under the circumstances no confiscation, fine could not be imposed by the adjudicating authority. The appellant contends that the penalty also could not be imposed since no violation of notification was committed by the Importer. Findings 8. I have carefully gone through the facts and records of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant Commissioner, as the case may be, within six months or such extended period, as that Deputy Commissioner or Assistant Commissioner may allow, a certificate issued by the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, in whose jurisdiction the said goods have been used in such unit, that the said goods have been so used. 11. The Notification No. 21/2002-Cus., dated 1-3-2002 was amended vide Notification No. 66/2004-Cus., dated 9-7-2004. The exemption provided at S. No. 152 were amended as under : S. No. Chapter or Heading No. or sub-Heading No. Description of goods Standard Rate Additional Duty rate Condition No. 152 4707 (A) All goods imported for use in, or supply to, a unit of manufacture of paper or paperboard. 5% -- 20 (B) All goods imported for use in, or supply to, a unit of manufacture of newsprint: 5% NIL 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n is provided is not violated in the present case. 14. The second part for availing exemption is to fulfil the condition No. 20 specified in the Annexure to the Notification No. 21/2002-Cus., dated 1-3-2002 as amended. The said Sr. No. 20 provides two conditions (a) and (b). These conditions are mentioned at para 10 above. As regard the condition at (a), I find that the appellant has given the undertaking to the concerned customs authority at the time of import. So far as the use of the imported goods for the specified purpose, I have already found that the imported goods were used for the specified purpose only. The detail finding in this regard are at para 13 above. 15. As regard the condition at (b), I find that the appellant have not complied with the said condition. They have neither obtained certificate from their jurisdictional Assistant Commissioner of Central Excise nor from the jurisdictional Assistant/Deputy Commissioner of Central Excise of SPPML to whom they have cleared the segregated white paper waste, regarding the use of the said imported goods for specified purpose. However, in this regard I find that the purpose of condition of obtaining such certificate fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edural condition of Sr. No. 20(b) was specified. It is proved beyond doubt that the appellants have complied the substantive condition of the notification. The show cause notice of the present case itself stands as certificate in this regard. Therefore, exemption of the Basic Customs Duty provided by the Notification No. 21/2002-Cus., dated 1-3-2002 as amended cannot be denied. 17. I further find that the Hon ble CESTAT, Eastern Bench, Kolkata has held in case of CCE, Kolkata-III v. Essen Synthetics Pvt. Ltd. reported at 2012 (280) E.L.T. 82 (Tri.-Kolkata) that Benzene and Toluene - Concessional rate of duty - End use certificate - Benefit of exemption notification not to be denied for non-production of end use certificate - Use of goods in manufacture of solvent and thinner not disputed - No evidence to contrary produced - Notification No. 75/84- C.E. [para 5]. In the present case also use of imported goods for specified purpose is not in dispute. In fact, it is confirmed in the investigation of the Central Excise Department itself. 18. In view of the above discussion, I hold that the goods are not liable for payment of differential customs duty and confiscation. Since, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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