VISTA PHARMACEUTICALS LTD. Vs. COMMISSIONER OF CUSTOMS, HYDERABAD

JUDGEMENT

(1.) THIS appeal has been filed against the Order -in -Original No. 37/2005 -Commr. dated 29 -12 -2005, passed by the Commissioner of Customs and Central Excise, Hyderabad -Ill Commissionerate.

(2.) THE appellants set up 100% E.O.U. for manufacture and export pharmaceutical formulations such as Tablets and Capsules. Under the Notification No. 13/81 -Cus. dated 9 -2 -1981, the appellants imported capital goods duty free. All the machines imported were installed and put to use in the manufacture of the goods to be exported. However in respect of one machine, the appellants could not install the same and put to use for production. Hence the Revenue proceeded against the appellants by issue of Show Cause Notice dated 21 -9 -2005, proposing confiscation of the machinery under Section 111(o) of the Customs Act, 1962 and demand of duty. Penalty under Section 112(a) of the Customs Act, 1962 was also proposed. The Adjudicating authority confiscated the machinery under Section 111(o) of the Customs Act, 1962. He imposed redemption fine of Rs. 10,000/ -. Further he demanded an amount of Rs. 2,40,65,837/ - being Customs duty and Additional duty in lieu of Excise duty leviable on the machinery. Interest under Section 11AB was demanded. A penalty of Rs. 5,00,000/ - under Section 112(a) of the Customs Act, 1962 was imposed. The appellants are highly aggrieved over the impugned order.

(3.) SHRI M. Chandrasekhar, learned Sr. Advocate and Smt. Rukmani Menon, Advocate appeared on behalf of the appellants. Shri K. Sambi Reddi, learned JDR appeared for the Revenue. The learned Sr. Advocate urged the following points : -