COMMISSIONER OF CUSTOMS Vs. ROYAL RECYCLING INDUSTRIES

JUDGEMENT

(1.) THE Appellant -revenue has challenged the order dated 12th September 2008 made by the Customs, Excise & Service Tax Appellate Tribunal (the Tribunal), proposing the following two questions:

(2.) THE Respondent was registered as a 100% EOU for manufacture and export of Recycled Metal Scrap Ingots and Metal Alloys etc. The Respondent imported a consignment of 75.950 M Ts of old and used transformers during the year 2004 declaring the same as waste and scrap of transformers under Bill of Entry dated 6th January 2004 and claimed exemption from Customs Duty under Notification No. 52/2003 dated 31st January 2003 and from Special Additional Duty under Notification No. 52/2003 dated 31 -1 -2003. Upon examination of the goods in question, the Department was of the view that the imported goods were not scrap, but old and used transformers, which was also confirmed by an expert and issued a show cause notice dated 29th January 2004. The show cause notice came to be adjudicated vide order dated 30th January 2004, whereby the adjudicating authority ordered confiscation of the goods and also imposed penalty under Section 112A of the Customs Act, 1962 (the Act). Being aggrieved, the Respondent -importer carried the matter before Commissioner (Appeals) who dismissed the appeal. The Respondent carried the matter further in appeal before the Tribunal and succeeded.

(3.) AS can be seen from the impugned order of the Tribunal, the Tribunal has placed reliance upon its earlier decision in case of M/s. Siyaram Metals Pvt. Ltd. and has set aside the impugned orders and allowed the appeal. The Tribunal has recorded that the Respondent had been permitted to import used old and damaged transformers, which was nothing but transformer scrap; it was not the Revenue's case that new transformers or transformers in usable condition were imported by the Respondent; even according to the expert opinion, the same were old and used; when the Adjudicating Authority had not confirmed any demand of duty against the Respondent inasmuch as the Respondent was eligible to import old/used/damaged transformers, the findings of misdeclaration and undervaluation become irrelevant. The Tribunal was, accordingly of the view that when no duty is payable on the imported consignment, the charge of undervaluation of the goods cannot be upheld inasmuch as the Respondent Assessee was not going to be benefited from the same.