2004 (11) TMI 236

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..... QABAL). The obligation cast on the importers is that they should manufacture the final product, Bright Stainless Steel Bars, out of the duty free materials and export them within a given time as stipulated by DGFT authorities. The dispute pertains to import made under 9 VABAL licences and 2 QABAL licences. Some of the imports are made by M/s. GFL and others by their supporting manufactures. 3.The allegations in the show cause notice leading to the impugned order are as follows : (a)        M/s. GFL, availed of Modvat credit on the inputs used in the manufacture of products exported under VABAL. This constitutes violation of condition (v) of Notification No. 203/92-Cus. and consequently M/s. GFL, are not .....

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..... It is under these circumstances he came to the conclusion that the importers have acted in terms of amnesty scheme and fully complied with the conditions therein and therefore demand for customs duty on the raw material imported under VABAL licences does not stand. (b)        Insofar as imports made under 2 QBAL licences the allegation is that M/s. GFL sold the imported material to their supporting manufacturer M/s. Diraj Iron and Steel Pvt. Ltd. The Commissioner's finding in this regard is that Notification No. 204/92 does not prohibit availment of Modvat credit on inputs used in the manufacture of export product. The only condition is that such imported materials shall not be sold before the export obli .....

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..... ive of M/s. Shree Ishar Alloy Steels Ltd., M/s. Panchmahal Steel Ltd. and M/s. Ferro Alloy Steel Corporation Ltd. and records recovered from their respective places indicated that the materials imported by them by utilizing the licences of M/s. GFL under letter of authority were used by each of them in the manufacture of their own products. The goods thus manufactured, were sold by them for home consumption. Accordingly the imported materials were not used in the manufacture of export products. Since the so called supporting manufacturers have not used the imported material in the manufacture of export products, customs duty is liable to be paid on the duty free material. Further the impugned goods are liable to confiscation. The Commission .....

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