FERRO ALLOYS CORPN. LTD. Vs. CC

JUDGEMENT

(1.) BOTH these appeals involve a common question of law and as such, they are being disposed of by a common order. The demand of duty of Rs. 19,945/ - and Rs. 18,225/ - has been confirmed against the appellants on the ground that LALP METALLURGICAL COKE imported by them at nil rate of duty was found to be short -received at their warehouse, Randia. Explaining this, Shri K.K. Bhattacharjee, ld. Constt. along with Shri N.S. Dey, ld. Advocate submits that they are 100% export oriented unit engaged in the manufacture of 'Charge Chrome'. Low Ash Low Phospores Metallurgical Coke which is raw material for Charge Chrome was imported by them at nil rate of duty in terms of Notification No. 13/81 -Cus. dated 9.2.1981 at Port of the Paradeep. The same was subsequently transported to their ware -house at Randia which is about 180 kms. away from the port of Paradeep through transit. Because of a number of factors including hygroscopic nature of the goods in question and the difference in the scale at the two places and on account of loss in transit from Paradeep to Randia, the goods warehoused are short -received by them. He clarifies that this is a recurring problem being faced by them and earlier also, the demand of duty was confirmed against them by the customs authorities by denying them the remission of duty in terms of Section 23 of the Customs Act, 1962. He submits that on appeal against the earlier demand of duty, the Tribunal in their own case reported in, 1991 (52) ELT 268 (T) :, 1990 (31) ECR 648 (T) had quashed the demand by holding that demand on short -landing of goods lost or destroyed by whatever reason or at any time before clearance for home consumption are eligible for remission of duty in terms of Section 23(1) of the Customs Act, 1962. Drawing my attention to the observations made by the Tribunal in the said Judgment of Ferro Alloys Corpn. Ltd., ld. Constt. draws my attention to para 9 of the order which records the total shortage of coke imported by the appellants to the tune of 2.83% which is inclusive of transit loss of 4.2 M.T. In para 11, it was observed that the loss of weight in the LAM Coke was due to the evaporation of water content and it is not the case of the department that the quantity found short was pilfered or clandestinely cleared by the appellants. It was held by referring to the earlier decision of the Tribunal that the expression 'lost' or 'destroyed' appearing in Section 23(1) is not used in any narrow or particular sense, but in a broader sense and includes the loss or destruction caused by whatever reason.

(2.) SHRI R.K. Roy, ld. JDR depends on the reasoning of the authorities below by submitting that hygroscopic nature of the contents which the appellants contend will result in absorption of water content resulting increase in weight of the goods during transit. He submits that the appellants have failed to produce any evidence on record to show the shortage of the goods occurred en route and as such, the provisions of Section 23(1) cannot be attracted. He also submits that there is no test report by the appellants as regards moisture content of the LALP Coke in question. I have considered the submissions made from both the sides. I find that the earlier decision of the Tribunal in the case of Ferro Alloys Corpn. Ltd. v. C.C. & C. Ex. (supra) fully covers the appellants case. In that case, the total shortage was to the tune of 2.83% whereas in the instant case, the shortage is only 0.39% in one case and 2.83% in another case. There is also no allegation or evidence by the Revenue that the goods have been clandestinely removed by the appellant or there was shortage due to pilferage. As held by the Tribunal in the above referred Judgment, if there is any quantity which fell short of the manifest (sic) quantity before clearance for home consumption, the party is entitled for the relief under Section 23(1) of the Customs Act. As the dispute involved in the present case is fully covered by the decision of the Tribunal in the case of Ferro Alloys Corpn. (Supra), I, therefore, set aside the impugned order and allow the appeals with consequential relief to the appellants.