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TMI Blog2018 (7) TMI 1603X X X X Extracts X X X X X X X X Extracts X X X X ..... uently the question of enforcing the penal liability before the expiry of the extended period does not arise at all - appeal allowed - decided in favor of appellant. - C/124/2011 - FO/76052/2018 - Dated:- 18-5-2018 - SHRI P.K.CHOUDHARY, Member (Judicial) and SHRI Bijay Kumar, Member (Technical) Shri Sukhendu Bhattacharya, Advocate Shri R.N.Bandopadhyay, Consultant for the Appellant (s) Shri S.N.Mitra, AC(AR) for the Respondent (s) ORDER Per Shri Bijay Kumar The present appeal has been filed by the appellant against the impugned order where the Ld. Adjudicating Authority has confirmed the demand against the appellant. This is second round of litigation before the Hon ble Tribunal. Hon ble Tribunal vide its Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. Adjudicating Authority has considered this letter and passed the impugned order. 2. Ld. Counsel for the appellant states that the Development Commissioner after taking the view of Approval Committee as well as after appreciating the difficulties faced by all plastic units during that material period. The Ld. Development Commissioner had also initially extended the LOP of the appellant s unit for a period up to 31.07.2006 giving effect from 06.11.2005 and subsequently extended till 05.11.2010 for fulfillment of the export obligation and meet the foreign exchange earning criteria during the extended period. Ld. Counsel also states that the Order of the Adjudicating Authority has travelled beyond the scope of the show cause notice f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. Counsel further vehemently argues that in view of Development Commissioner s Order extending the LOP, there is no scope for the Adjudicating Authority to deny the benefit and recover the amount of customs duty for whom having failed to achieve positive NFE within the communicated period of 5 years from the date of commencement of production and this communicated period was supposed to be not extended to achieve the positive NFE. In this regard ld. Counsel has relied on the decision of Mavi Industrial Ltd. vs. Commissioner of Cus. C.Ex, Thane-II [2013(289) E.L.T. 15 (Bom.)] and in view of this judgment ld.Counsel states that the Adjudicating Authority has confirmed the demand of duty foregone in a wrong manner. 3. Ld. D.R for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne authority grants extension of five years, whereas, another authority wants to penalise the assessee without giving an opportunity to fulfil the export obligation during the extended period. It is relevant to note that the assessee has executed the bond before the Development Commissioner as well as the customs authorities and both the authorities are entitled to take penal action if NFEP/export obligation is not fulfilled. Once the Development Commissioner after considering the facts of the case grants extension of LOP so that the needful could be done during the extended period, penal liability cannot be fastened upon the assessee by any authority before the expiry of the extended period. Therefore, the argument of the customs authoriti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lations of law other than nonfulfillment of the export obligation. It is only because, the assessee had shown bona fides/reasonable cause for nonfulfillment of the export obligation, the Development Commissioner had considered it proper to grant extension so that during the extended period the assessee could fulfil the balance export obligation as also the additional export obligation imposed while granting the extension. In other words, clause 3(d) is inserted with a view to ensure that on account of granting extension to fulfil the balance export obligation/performance, in the second block of five years, the assessee does not escape the penal liability for violating any other provisions of law committed by the assessee during the first bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same issue and we therefore inclined to accept the order of the Hon ble High Court of Bombay wherein it is clearly stated that before expiry of the extended period of LOP it is neither open to the Development Commissioner nor to the customs authorities to treat that the assessee had ceased to be a 100% EOU after the expiry of the first block of five years and consequently the question of enforcing the penal liability before the expiry of the extended period does not arise at all. 7. In the case of appellant it is also seen that earlier they were 100% EOU which were converted into SEZ unit after following appropriate procedure and obtaining permission of the competent authority. The matter before us is covered by the aforesaid judgment. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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