INTERNATIONAL IMPEX BUREAU Vs. COMMISSIONER OF CUSTOMS, KANDLA

JUDGEMENT

(1.) THIS is an appeal filed against the decision of the Collector of Central Excise and Customs, Ahmedabad, made in Order -in -Appeal No. 343 and 344/92 (33 to 34 -KDL) Cus/Collr.A/Ahm. dated 30.4.1992 whereunder he confirmed the orders of the Assistant Collector of Customs, Orders -in -Original No. 20/89 dated 13.11.1989 and 30/89 dated 2.11.1989 regarding duty confirmed on fabrics and refund claim of Rs. 53,858/ - respectively.

(2.) THE facts of the case are that the appellants were approved for setting up a unit in Kandla Free Trade Zone in the year 1964 for weaving and printing of yarn, fabrics, printing dyeing, crayon etc. and manufacture of mixed fabrics. The appellant after establishing their unit in Kandla, imported several consignments of yarn totaling about 17670 kgs. valued about Rs. 2,31,800/ -. It was alleged by the appellants that the manufactured fabrics, using portion of the imported raw materials and exported 710 kgs. of manufactured fabrics. The importation, it is alleged, had taken place at Bombay Port during December 1968 to March 1969. After such importation it was transported by road to KFTZ after executing bond with Bombay Customs. The two consignments consisting of 48 cases imported from two vessels weighing about 40760 kgs. valued at about 2500 were despatched. A bond was executed for Rs. 4,27,050/ - towards goods which were sent in 39 cases on 30.12.1968 and 7.3.1969. As far as the last consignment of 9 cases imported ex s.s. Asia, is concerned, the appellants executed a bond for Rs. 1,39,038/ - and it was found that they were substituted. In respect of 39 cases supra, goods i.e. polyester filament yarn weighing 3580.2 kgs. valued at 1772.4 CIF was found substituted. It was also found that same goods weighing 813.600 valued at 482.15 was also found substituted. The goods worth about Rs. 6 lakhs were exported. The Customs Authority issued tow notices dated 23.5.1969 demanding payment of duty from the appellants, demanding Rs. 1,39,038/ - and Rs. 4,27,050/ -. The appellants filed writ petition in Bombay High Court resulting in Consent Terms filed in the Bombay High Court, dated 19.12.1992. The appellants preferred appeal to the Central Board of Excise which by its order dated 30th September, 1978 allowed the appellants to export the goods within a period of six months. By further order dated 23rd October, 1979, further period of six months was granted. Ultimately it was further extended upto 11.5.1981. It appears that the appellant exported 19268 metres of fabric. It transpires that due to litigation, the goods held on stock became substandard and on inspection by Textile Committee, it was found that the goods were not fit for export. The appellant moved Gujarat High Court by filing Special Civil Application No. 1188/80 against the orders of the Development Commissioner, KFTZ challenging confiscation. By order dated 9th August, 1986, the Gujarat High Court set aside that order of confiscation. Special Leave Petition was filed by the Government in the Supreme Court against this order. The Supreme Court was pleased to hold that the direction by the High Court of Gujarat for release of stale and unexportable goods found subject matter of the Special Leave Petition on payment of duty lawfully leviable. The Supreme Court directed release of the goods in three lots. As per orders of the Supreme Court the duty leviable in the show cause notice dated 28.4.1988 was issued under Section 3 of the Central Excise Act. The appellants filed reply challenging the applicability of Section 3 of the Central Excuse Act, especially the amendment thereof which came into force on 1st March, 1982 whereas the goods in question were confiscated as far as back in 1976. The appellant also stated that, but for the confiscation made in 1976, the same would have been expected or released for DTA. It was also stated by the appellant that there cannot be any retrospective application of the amendment made in 1982. They also claimed exemption as the goods were manufactured on powerloom and are in grey state as per Central Excise Tariff No. 55. By Order -in -Original dated 3rd November, 1989, the adjudicating authority rejected the contention against which two appeals were filed. The appellate authority confirmed the same. Hence the present appeal before us.

(3.) LEARNED counsel appearing on behalf of the appellant challenged the application of the amendment made in 1982, to Section 3 of the Central Excise Act inasmuch as the goods were confiscated in 1976. He emphasizes the fact that there cannot be any retrospective application. He also stated that the Collector (Appeals) did not make any speaking order especially in respect of valuation of the goods. The learned DR appearing before us would reiterate what is contained in both the orders.