ADISHWAR SPINNERS LTD. Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) LD . Commissioner of Customs (Imports) demanded duty of over Rs. 58 lakhs from the appellants in respect of goods imported by them and cleared under a few Bills of Entry. He also appropriated the cash deposit of Rs. 7 lakhs made by the party, towards this demand, besides realising an amount of Rs. 1,95,032/ - through enforcement of Bank Guarantees. Thus, in terms of the impugned order, duty of about Rs. 50 lakhs is recoverable from the assessee. Ld. Commissioner also imposed a penalty (equal to duty) on the appellants under Section 114A of the Customs Act, after ordering confiscation of the imported goods with option for redemption. The present application seeks waiver of pre -deposit and stay of recovery in respect of the duty and penalty amounts. There is no representation for the appellants. A letter dated 23 -2 -2006 of Shri A.K. Jayaraj, Advocate has just come on record seeking adjournment on medical ground. As we have found no Vakalat on record, we are not in a position to entertain the advocate's request. We have examined the records and heard the ld. SDR.

(2.) THE imports of what was declared as "Greasy Raw Wool of 34.0 Microns mean fibre diameter" were made and sought to be cleared with the benefit of concessional rate of duty under Notification No. 20/99 -Cus., dated 28 -2 -1999 as well as the benefit of exemption from Special Additional Duty (SAD) under Notification No. 22/99, dated 28 -2 -1999. In provisional assessments, these benefits were allowed. Ld. Commissioner, in the impugned order, finalised the assessments by disallowing the benefits of the Notifications to the assessee. Hence the above demand of duty. It appears from the records that the mean fibre diameter of the goods was found to be less than 34 Microns in a test conducted at the National Textile Laboratory and a document filed by the assessee claiming the same to be 'test report' issued by the Australian Wool Testing Authority (AWTA) was found to be forged. It was on this basis that the benefit of concessional rate of BCD was denied to the assessee. It further appears from the records that the benefit of exemption from payment of SAD on the goods in question was claimed by the party by misdeclaring that they did not intend to put the goods into any process of manufacture and by claiming that they intended only to trade in the goods imported. This claim stood disproved when the Managing Director of the company admitted that they had subjected the goods to a process of manufacture. That statement, it appears, was never retracted. Thus, it appears that the benefit of exemption from payment of SAD was also not available to the subject goods as held by ld. Commissioner. The appellants have not made out prima facie case against the demand of duty. At this stage, we have noticed a plea of financial hardships in the affidavit filed by Mr. Davinder Singh Grewal, Director of the Company, in support of the stay application. The affidavit states thus: I further state that, the copy of the balance sheet and the profit and loss account produced by me will reveal that the financial position of the company is in the red. Under these circumstances this Honourable Tribunal may be pleased to waive the pre -deposit of duty, fine and mandatory penalty amount. However, no copy of any Balance Sheet and Profit & Loss Account is forthcoming.

(3.) IN the light of our findings recorded above, we direct the appellants to pre -deposit the balance amount of duty for the purpose of Section 129E of the Customs Act within a period of 4 weeks from the date of receipt of a certified copy of this order. In the event of due compliance with this direction, there will be waiver of pre -deposit and stay of recovery in respect of the penalty amount. Report compliance on 6 -4 -2006.