VVF (INDIA) LTD. Vs. COMMISSIONER OF CUSTOMS, KANDLA

JUDGEMENT

(1.) THESE two appeals are directed against Order -in -Original No. KDL/COMMR/23/2011 -12, dated 31 -3 -2012. The relevant facts that arise for consideration are that the appellant (hereinafter referred to as WF) is having manufacturing facility and had applied for and granted advance licence for import of duty free raw material for consumption thereof for manufacturing of final product for export purposes. In pursuance of such advance licences issued, the appellant imported consignment of "Acid Oil" declaring the same as acid oil. On an intelligence gathered, the Revenue Department were of an impression that the appellant had actually imported Palm Fatty Acid Distillate (PFAD) which attracts duty and is not covered under the licences granted to the appellant and were also of the view that PFAD and acid oil are technically and commercially different products. The Revenue authorities visited the premises of the appellant herein and drew the samples of imported goods lying in stock and sent the same for analysis to Visakhapatnam. On receipt of the analysis report from CRCL Visakhapatnam, who opined that the imported goods were not Palm Acid Oil, but were having characteristics of PFAD. Subsequently, the Revenue authorities recorded various statements of the responsible persons in the main appellant's (WF) factory. On conclusion of such investigation, a show cause notice was issued to the appellant on the ground that they had misdeclared the goods which were imported and the said goods were not permitted to be imported under advance licences. The appellant herein contested the show cause notice on merit and limitation. They contested before the adjudicating authority that the documents which were filed by them before the authorities were for "Acid Oil"; which were conforming to the specification as given in BIS -IS 12029:1986; they also submitted that the advance licences which were procured by them was based upon such specification and the chemical examiner's report also indicate that the goods which were imported were "Acid Oil" as per BIS. The adjudicating authority did not agree with the contentions raised by the appellant and confiscated the goods which were seized, finally assessed the Bills of Entry holding that the product can be considered as PFAD as against declared description of acid oil denying the benefit of exemption Notification No. , confirmed the demand of the duty along with interest and imposed penalties on both the appellants.

(2.) WHEN the matters were listed for disposal, Revenue filed two miscellaneous applications No. C/Others/15561/2014 and C/16479/2014 for bringing on record the ullage report as well as other documents and additional facts for deciding the said appeals. The said contentions were pressed by the ld. Commissioner (AR). Ld. Commissioner submits that the said ullage reports and various documents are necessary for deciding the issue as it is the case of the Revenue that the said products which was imported as declared by the appellant, was not correct and the goods when they were loaded at the port of export, they were PFAD. Ld. Counsel appearing on behalf of the appellant contested the said applications on the ground that these documents were never a part of the show cause notice nor relied upon documents. It is his submission that Department cannot bring on record any additional documents which were not part of original investigation. It is his submission that the departmental authorities did not recover these documents at the time of investigation and these documents were surfaced after the matter was listed for final disposal on an application made by the appellant. He would submit that the said additional documents, on which reliance is placed being not a part of the record, should not be admitted.

(3.) LD . Counsel appearing on behalf of the appellant, after taking us through the entire case record would submit that the adjudicating authority has erred in coming to a conclusion that there was misdeclaration on the part of the appellant. He would take us through the Order -in -Original and submit that the products which were imported by the appellant had been declared by them as acid oil and not as palm acid oil. It is his submission that the conclusion of the chemical examiner as has been relied upon by the Department is also in his favour inasmuch as the said report state that the product is other than palm acid oil which is irrelevant as the appellant has never declared the product as palm acid oil. After taking us through the BIS standard for "acid oil", he would submit that the standards as laid down by BIS has been complied with by imported products as tested by the chemical examiner. It is his submission the appellant had never declared their product as palm acid oil or PFAD. It is his submission that the chemical examiner has also come to a conclusion that the goods which are imported are not PFAD but are having characteristics of PFAD and such a conclusion supports the declaration made by the appellant that the products are acid oil. The submission of the ld. Counsel is that the conclusion of the chemical examiner therefore does not establish any misdeclaration on the part of the appellant.