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TMI Blog2020 (2) TMI 1602X X X X Extracts X X X X X X X X Extracts X X X X ..... r and cut to relevant sizes, thereafter cleared to the site of the customer for fitting it finally in the Heat Exchanger. They have argued that the Graphite Tubes are cleared separately instead of fitting the same in their factory due to the fragile nature of the said Graphite Tubes, which in all probability could break during the course of transportation of the Heat Exchanger to the site. The Revenue s only objection in denying the benefit of Notification is that the imported Graphite Tubes were not used by the appellant in their factory. There is no dispute of the fact that the Graphite Tubes were received in the factory and to the claim of the appellant that they were tested and made suitable after necessary cutting and polishing, etc., to be used in Heat Exchanger, a part of MSFE system, no contrary evidence has been placed on record - a logical, reasonable and technically sound explanation has been furnished by the appellant for such separate clearance. It is stated that due to fragile nature of the imported graphite tubes, after its testing the same were cleared separately to avoid damage during transportation of the Heat Exchangers to the site. It cannot be denied that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed to be confiscated under Section 111(d) and 111(o) of the Customs Act, 1962. On adjudication, the demands have been confirmed with interest and penalty of equivalent amount; goods were directed to be confiscated under Section 111(o) of the Customs Act, 1962 with an option to redeem the same on payment of fine; penalty of ₹ 3.50 lakhs was imposed on Shri N.K. Garg under Section 112(a) of the Customs Act, 1962 and the proceedings against Shri O.P. Pareek directed to be kept in abeyance till service of notice to him. Hence, the present appeals. 3. At the outset, the Learned Advocate for the appellants Shri T. Viswanathan has submitted that during the relevant period they had availed the benefit of concessional rate of duty under Notification No. 21/2002-Cus., dated 1-3-2002 on import of the Graphite Tubes for its use in Heat exchangers manufactured in their factory. He has submitted that they have followed the entire procedures laid down under Customs (Import of Goods at Concessional Rate of Duty for Manufacturing of Excisable Goods) Rules, 1996. The imported Graphite Tubes were received in the factory of the appellants and due intimation about the receipt of the said good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was cleared separately and fitted into the MSFE at the site of the customer s plant. The End Use Certificates are enclosed by the appellant, which has also been accepted by the adjudicating authority in the impugned order. Thus, the graphite tubes which were imported had been undisputedly used in the MSFE System/Heat Exchangers manufactured and cleared from the factory of the appellant. 3.2 He has further submitted that the Learned Commissioner in the impugned order denied the benefit of exemption only on the ground that the goods imported were not used in the factory of the importer as required under 1996 Rules, but were traded by clearing as such to the site of their customer. He has submitted that the said finding of the Learned Commissioner is contrary to the principles of law laid down by the Tribunal in the case of Tamil Trading Corporation v. CCE - 2006 (198) E.L.T. 539 (Tri. - Chennai) by interpreting the 1996 Rules. In the said case, the Tribunal while interpreting the expression his factory held that it is a factory where the importer wants to utilize the imported goods in terms of the Notification. The Department cannot insist on the ownership of the factory and d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the customer, and fitted to Heat Exchangers, which in turn, used in MSFE system installed at the site of the customer. The Revenue s objection is that as a condition of the said Notification No. 21/2002-Cus., dated 1-3-2002 read with Customs (Import of Goods at Concessional Rate of Duty for Manufacturing of Excisable Goods) Rules, 1996, the imported Graphite Tubes were required to be used in his factory , even though the same were fitted to Heat Exchanger at the site of the customer. Rebutting the said argument, the appellants have submitted that after receiving the Graphite Tubes in their factory the same were tested for its suitability in the Heat Exchanger and cut to relevant sizes, thereafter cleared to the site of the customer for fitting it finally in the Heat Exchanger. They have argued that the Graphite Tubes are cleared separately instead of fitting the same in their factory due to the fragile nature of the said Graphite Tubes, which in all probability could break during the course of transportation of the Heat Exchanger to the site. Also, the appellants have referred to the judgment of this Tribunal in Tamil Trading Corporation (supra), where expression his factory ..... X X X X Extracts X X X X X X X X Extracts X X X X
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