9911796707
TMI Blog2022 (2) TMI 801X X X X Extracts X X X X X X X X Extracts X X X X ..... tment Plant, Railway Siding, Housing Colony for its employees, recreational facilities, Cooperative Credit Societies etc. The company diversified its activities by installing a Nylon Plant in 1974 and in a couple of years, it established Polyester Plant. Thereafter, the Company established Nylon Tyre Cord Plant in 1981. In the year 1995-1996 the company had imported Plant and Machineries/equipments under OGL from Japan, Germany and Korea after executing 21 Bonds amounting to Rs. 18,01,31,442/-. The goods were initially stored at Bombay Location to the safety and security of goods . On the request of the appellant the imported goods were allowed to be shifted from Bombay to appellant's private bonded warehouse at Surat. 1.2 After the expiry of Initial warehousing period, the company had applied for first extension of warehousing period and the department had granted first extension up to 30.06.1996 for six months. As the appellant was not able to clear the imported plants & Machineries/equipments due to financial crunch, the company had appliedfor the second extension which was granted by the department up to 31.12.1996. The third extension was granted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akhs to be deposited by the appellant with 3 months and report compliance to Commissioner(Appeals), Surat who will decide all these appeals on merit. As the appellant did not have the sufficient funds of Rs. 50 Lakhs and therefore, no compliance of the said order was made and hence by default the Commissioner (Appeals) order became final.Thus, the liability of Principal duesof Custom Duty Rs. 688.06 Lakhs is outstandingfrom the appellant on the bonded plants, Machineries/equipments imported during the year 1995-1996. Thereafter,on 26.10.2006 the appellant requested the Department for transferring the bonded plants & Machineries/equipments lying in their private bonded warehouse outside the factory premises to inside the factory premises at Surat. The department in its reply dated 19.01.2007 stated that since request for extension of warehousing period has been rejected beyond the year 1998 and since the SCN for all the consignments were already given to the appellant has been confirmed duty demand of Rs. 6,85,96,547/- and penalty of Rs. 2,10,000/- along with interest is still pending for recovery . Therefore, permission cannot be gran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for re-export of said consignments under Section 69 ibid along with consequent extension of warehousing period from the year 2008 till the year 2018. As the same could not be rigorously pursued as the company was passing through a phase of sickness under Bombay Relief undertaking Act and SICA Act, 1985. 1.4 During the period of 16 years from year 2000- 2016 the appellant case was pending before BIFR/AAIFR, the department neither took any action for recovery of the Custom Duty on account of expiry of extended warehousing period nor decided the appellant request for re-export of warehoused goods. In this background the appellant vide its letter dated 15.11.2018 has requested the Chief Commission of Customs, Gujarat Zone, Ahmedabad for extending the warehouse period as the appellant was going to re-export the imported plant, Machineries/equipments. This was followed up vide their letter dated 03.12.2018 the said request of extension of warehousing period on account of re-export has been rejected by the Chief Commissioner vide its letter dated 19.12.2018 on the ground that once the show cause notice has been issued and demand has been confirmed upto thelevel of the Tribunal i.e. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2.1 He also referred to Board Circular No 12/2007-Cus dated 14.02.2007 based on accepted Gujarat High Court order dated 07.10.2005 in case of m/s Amtrex Hitachi Appliances and Hon'ble Karnataka High Court in of M/s Bangalore Wire Rod Mills wherein it was clarified that the amendment to Customs Act modifying the terms and conditions subject to which the goods shall remain warehoused shall not apply to goods warehoused prior to the amendment. Thus subsequent amendment of the said section 61 after the goods were warehoused in 1995-1996 is of no implication to the appellant's case. Thus the Chief Commissioner of Customs had unlimited power of extending the warehousing period without any restriction imposed under section 61 subsequent to the warehousing of the goods by the appellant in 1995-1996 shall not be applicable. 2.2 He submits that as per Section 72(1)(d) of the Customs Act, 1962 where any goods in respect of which a bond has been executed under section 59 and which have not been cleared from home consumption after expiry of warehousing period, the proper officer may demand the duty after the expiry of warehousing p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owed under Section 69 of the Customs Act, 1962 and as corollary to the same, the period of warehousing ought to have been extended as is mandatorily required so as to enable the appellant to export the goods within extended permitted period of warehousing. 2.5 He further submits that as regard the reliance placed by Learned DR on the Bombay High Court Judgment in the case of M/s Videocon International Ltd reported at 2003 (155) ELT 25-(Bom) and withdrawal the appeal filed by party in Supreme Court . It is his submission that after the said judgment dated 29.09.2002 the board has issued a circular dated 14.01.2003 (Supra) permitting the re-export of the warehoused goods without payment of duty under section 69 ibid even if permitted period of bonding has expired and demand notice has been issued or it has been decided to put the goods under Auction. Before permitting re-export in each such case by the chief Commissioner it will be necessary for him to extend the period of warehousing under section 61ibid to enable the importer to export the goods within the permitted extended period of warehousing in the light of its circular dated 14.01.2003 which extended the be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is clear that they are eligible for 98% of the duty drawback if the duty is paid by them.In support of his this submission, he placed reliance on the following judgments: * M/s Sedco Forex International - 2001 (135) ELT 635(Tri. Mum.) * M/s Cipla Ltd -1995 (80) ELT 17- (Bom.) * M/s Shipping Corporation of India - 2014 (312) ELT 305(Tri.Bom) * M/s Jagson International Ltd in Customs Appeal No. C/10329/2019 vide Final order No A/10827/2019 dated 09.05.2019 2.7 With his above submission he requested that the appellant be allowed the re-export of the goods without payment of custom duty under Section 69 and consequent extension of warehousing period. 3. Shri Vinod Lukose, Learned Superintendent (AR) appearing on behalf of the revenue reiterates the decision taken by the Chief Commissioner of Customs. He further submits that in this case since the demand has been confirmed and the same is upheld up to the Tribunal the request of the appellant for re-export and extension of Warehousing period cannot be granted. He placed reliance on the following judgments: * Videocon International Ltd- 2003 (155) ELT 25 (Bom) * ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported to any place outside India without payment of duty or may be allowed to be so exported subject to such restrictions and conditions as may be specified in the notification" From the above provision of Section 69 it is clear that warehouse goods are allowed to be exported from the warehouse without payment of duty. In the present case this fact is not under dispute that the goods which sought to be exported are indeed warehoused goods as the same are still lying in the Warehouse. As per this statutory provision even though the duty was otherwise confirmed by the adjudication process the same is payable only when the goods are cleared for home consumption but by virtue of Section 69 when the appellant seeks export of goods from the warehouse itself the same shall be allowed without payment of duty. 4.2 The appellant also strongly relied upon the Board circular 03/2003- CUS dated 14.01.2003. The relevant para is reproduced below: "2. The matter has been examined in the Board. It has been decided that in case an importer makes a request to permit re- export of the goods under section 69 of the Customs Act, 1962, such a request may be allowed even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the goods for home consumption. In the present case it is the appellant's request to allow the re-export of the goods therefore, in terms of the circular dated 14.01.2003 despite the provision under section 72(1)(d) the re-export is permissible without payment of duty. Therefore, there is no conflict between the board circular 03/2003-Cus dated 14.01.2003 and Section 72(1)(d) of the Customs Act ,1962 as the said section is applicable only in case when the goods are cleared for home consumption or in case the appellant do not intend to clear the goods and department proceed to sell the goods by auction. However, in the present case neither the goods were cleared for home consumption nor the department has initiated any action for sale of the goods. Therefore, in terms of the board circular 03/2003-Cus dated 14.01.2003 the appellant is entitled for re- export of the goods without payment of duty and consequently also entitled for extension of warehousing period. 4.4 Now coming to the judgments relied upon by the revenue, We find that judgment in the case of Videocon International (Supra) wherein the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Similarly, in the case of M/s Cipla Ltd (Supra) the assessee was allowed to re-export the goods on payment of differential duty of 2% after adjusting the drawback of 98% of duty admissible to them in terms of Section 74. 4.7 In the case of M/s Shipping Corporation of India (Supra) the Tribunal Mumbai has allowed the adjustment of duty payment against drawback admissible to the appellant. Dealing with the identical issue this CESTAT Ahmedabad bench in the case of M/s Jagson International Ltd vide final order no A/10827/2019 dated 09.05.2019 has held as under : "4. ........the Appellant after payment of redemption fine and penalty has option either to pay duty if he wants to keep the goods in India or to re export the same. In case of re-export for which he is eligible, the net effect of duty payable by him would be 2% i.e. difference between the duty payable and drawback amount under Section 74 of the Customs Act. It is also clear that he is eligible for 98% duty drawback of the duty paid by them. 5. ......... Going by the facts of the present case and settled legal position as cited above, we are of the view that the Appellant is eligible for re-export of impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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