DADRI INORGANICS PVT. LTD. Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) In this appeal under Section 130 of the Customs Act, 1961 (the Act), the Appellant-Assessee has challenged order dated 7-5-2008 (2008 (228) E.L.T. 205 (Tri.-Ahmd.)) made by the Customs, Excise & Service Tax Appellate Tribunal (the Tribunal), proposing the following five questions:

(2.) The Appellant filed drawback claim of Rs. 10,80,000/- in respect of the goods being "Heat Resistant Rubber Tape" exported under Shipping Bills No. 1007387 to 1007390, all dated 29-5-2000 before the Deputy Commissioner (Drawback). After filing of the aforesaid drawback claim in respect of the shipping bills dated 29-5-2000, a sample was drawn by the concerned officer which was sent for the purpose of testing to the Customs & Central Excise Laboratory, Kandla. Pursuant to the test report, inquiries were made by the concerned authority regarding drawback claims dated 2.9-5-2000 filed by the Appellant during the course of which, statements of certain persons came to be recorded. The investigation was followed by issuance of a show cause notice dated 7-4-2008, proposing to deny/disallow drawback claims filed by the Appellant, to deny/disallow and recover drawback claims to the tune of Rs. 64,80,000/- covered under various Shipping bills erroneously granted and proposing to impose penalty under Section 114(ii) and (ii) of the Act. The show cause notice came to be adjudicated vide Order in Original dated 26-12-2003 whereby the demands raised therein came to be confirmed along with rejection of drawback claim. A penalty of Rs. 5 lacs also came to be imposed on the Appellant and the goods in question were ordered to be confiscated. Against the said order, the Assessee preferred appeal before the Tribunal which came to be decided vide the impugned order dated 7-5-2008 whereby, the impugned order came to be upheld except for reduction of penalty from Rs. 5 lacs to Rs. 3 lacs.

(3.) Mr. Uday Joshi, learned advocate for the Appellant vehemently assailed the impugned order of the Tribunal, submitting that the basis of the show cause notice is the test report indicating that the goods exported by the Petitioner can be considered as "heat resistant rubber elastic tape" and not "heat resistant rubber tension tape" as described in the Drawback Schedule. Adverting to the facts of the case, it was pointed out that in the present case, the test report as regards the sample drawn on 29-5-2000 relating to the shipping bills dated 29-5-2000 has been made applicable to goods already exported by the Appellant under cover of 18 shipping bills filed for export of goods during the period from 24-1-2000 to 31-3-2000, to submit that the test report made in respect of samples drawn subsequently, could not have been made applicable to the goods manufactured/exported during the period prior thereto. Inviting attention to the test report, it was submitted that the product in question elongates under heat and is treated as nothing but "heat resistant rubber tension tape". According to the learned advocate for the Appellant, the Tribunal had erred in holding that the product exported by the Appellant was "heat resistant rubber tape" whereas the description of the product mentioned in the Drawback Schedule was "heat resistant rubber tension tape" (strip rubber elastic) and that, therefore, drawback was not available in case of the Appellant. The Tribunal found that in the facts of the case, the description of goods given in the shipping bills tallied with the goods actually exported and that it was not the case of the Department that there was willful mis-declaration of description. It is also found that there was a mistake on the part of the Department in having allowed drawback in case of earlier shipping bills. It was submitted that the Tribunal having found that it was not the case of the Department that there was mis-declaration of description and that the description given in the shipping bills tallied with the goods actually exported, the extended period of limitation could not have been made applicable in the present case. It was submitted that the show cause notice in the present case came to be issued on 17-4-2002 calling upon the Appellant to show cause as to why the drawback already granted relating to shipping bills filed during the period 24-1-2000 to 31-3-2000 should not be recovered. Thus, the present case being one of recovery, the limitation provided under Section 28 of the Act was required to be read into the provisions of the rule. This having not been done by the Tribunal, the impugned order of the Tribunal is not sustainable.