MODERN SUITINGS Vs. CC

JUDGEMENT

(1.) The appellants filed this appeal against the adjudication order passed by the Commissioner of CustoMs.

(2.) The brief facts of the case are that the appellants are engaged in the business of manufacture and sale of textile items including yarn and fabric of various kinds. The appellants were granted 2 import licences under the EPCG scheme by the Director General of Foreign Trade. In pursuance to these licences, the appellants made of 27 weaving machines. The appellants filed an in -bond Bill of Entry and the imported goods were warehoused. The appellants also made request for extention of warehousing period and the customs department extended the period of warehousing. In the mean time, the appellants made an application to the Ministry of Industry on 26.5.98 for setting up a 100% EOU at its existing plant. The Ministry of Industry granted approval to set up 100% EOU vide letter dated 7.8.98. As the appellants got permission to start a 100% EOU, they made a request to the DGFT for cancellation of the licences under EPCG Scheme as unutilised. The request was accepted by the competent authority. In the mean time, the appellants also approached DGFT to approve the goods imported in EPCG scheme for their use in the 100% EOU. The appellants also made a request vide letter dated 3.10.98 to the Assistant Commissioner to grant permission to have private bonded store room under Section 58 of the Act and also for permission to manufacture in bond under Section 65 in view of permission granted by the Ministry of Industry to set up a 100% EOU.

(3.) A show cause notice dated 12.3.99 to the appellants for demand of customs duty and for confiscation of the goods under Section 111(0) of the Customs Act as they have contravened the provisions of Notification No. 110/95 dated 5.6.95. The appellants replied to the show cause notice. On 25.5.2000 a corrigendum to the show cause notice was issued by the Commissioner of Customs whereby the provisions of section 111(j) of the Customs Act were also invoked.