COMMISSIONER OF CUSTOMS, HYDERABAD Vs. CHEMINOR DRUGS LTD.

JUDGEMENT

(1.) THIS is an appeal filed by the Revenue. The respondents (hereinafter referred to as CDL), are known manufacturers, exporters of bulk drugs and drug intermediates etc. They had imported (1) Isobutyl Benzene (2) Acetyl Chloride (3) Sodium Cyanide (4) Sodium Boro Hydride (5) Isopropyl Alcohol (6) Nickel (7) Methylene Chloride etc., required for manufacture of Ibuprofen, a bulk drug. The imports were made, duty free, under the DEEC scheme during the period 1987 -91. They fulfilled their export obligations as stipulated under the scheme. Consequent to certain enquiries that CDL had not utilized a part of the raw materials imported duty free but had mis -used/diverted them for other uses, a Show Cause Notice was issued. As it appeared from the balance sheets of CDL for the years 1987 -88, 1988 -89, 1989 -90 and 1990 -91 that the consumption of raw materials viz Isobutyl Benzene, Acetyl Chloride and Sodium Cyanide given in these balance sheet were not tallying with the norms submitted vide applications made for their Advance Licence. Taking the consumption figures from these raw materials given in the balance sheet for the year 1989 -90, it appeared that certain quantities of raw material were imported in excess of the requirement and thus mis -utilised in violation of Notification No. 44/87 -Cus., dated 19 -2 -87, 116/88 -Cus., dated 30 -3 -88, 159/90 -Cus., dated 30 -3 -90. Notice alleged that they appeared to have deliberately mis -declared the consumption norms, with a view to evade customs duty of Rs. 2.813 crores and were liable for a penalty under Section 112(a) of the Customs Act and why a duty amounting to Rs. 2.813 crores should not be paid and penalty should not be imposed.

(2.) THE ld. Adjudicator in view of the following findings: -

(3.) REVENUE has filed this appeal on the following grounds, with a prayer that the order passed should be set aside : - The order of the Commissioner is not legally correct and proper for the following reasons : -