JUDGMENT
J.H. Joglekar, Member (T)
1. This application is for waiver of pre-deposit of duty of Rs.
1,05,12,925/- and penalty of Rs. 50 lakhs. We have heard Shri Sridharan
appearing along with Shri Vishwanathan for the applicants and Shri A.K.
Jain for the Revenue.
2. The applicants imported a number of consignments of polyols and
isocyanates without payment of duty in terms of notification 72/91-Cus
as amended. The condition for such import were that the goods would be
used in the manufacture of thermoplastic polyurethane and that within
three months or the extended period as the customs allow, the end use
should be furnished to the Customs authorities. The imports were made
during the period February, 1992 to June, 1993. show cause notice dated
10/02/2000 alleged that the imported goods were not used for the
manufacture of the listed end product. A technical opinion given by the
Dy. Chief Chemist was cited to the effect that the sample of the final
products showed characteristics of rigid foam and could not be called as
thermoplastic polyurethane. The duty as cited above was demanded
without quoting the relevant section of the customs Act, 1962.
Allegation was made that the goods earlier imported were liable to
confiscation in terms of Section 111(o) of the Act. After hearing the
importers the Commissioner passed orders confirming the duty and
imposing the penalty as cited above. He observed that although the
assessees had stated that the bond for each individual consignment had
been discharged on the end-use certificate being shown the assessees had
filed to place before him such evidence. In dealing with the plea of
limitation under the Customs Act, 1962 he observed that time limit did
not apply in view of the deliberate intention to evade payment of duty.
He also mentioned that in terms of the bond/undertaking the demand
could be made. For imposition of fine he cited the Supreme Court
judgment in the case of Weston Components Ltd. v. CC, New Delhi
2000 (115) ELT 278. He discounted the certificate given by the
appellants form Shriram Institute has got in their favour. Hence the
appeal and the applications.
3. In terms of Section 28(1) of the Customs Act, 1962 the demand is
clearly hit by limitation. As regards the observation of the Commissioner
that the demand could be enforce in terms of the bond/undertaking, we
find that the details of such bonds/undertaking are not given in the show
cause notice at all. The show cause notice gives details of 24 imports
along with the bills of entry numbers, etc. It is presumed that in the case
of each importation the assessee had given a bond. If the Commissioner
was of the view that the promise made under those bond could be
invoked and put to test it was required to show the details of the bond. It
was the case of the assessee that in each case the bonds were discharged.
In view of the time that elapsed they were not able to furnish the proof.
We observe that both sides lack the vital documents on which such large
amount of duty is sought to be confirmed. At the stage of hearing of the
Stay applications this benefits the applicants more.
4. We also find that he opinion given by M/s. Shriram Institute is not
properly appreciated by the learned Commissioner. We find that there is
a specific opinion give that the sample was thermoplastic. The
Commissioner brought in some extraneous material and has made some
reference to the previous situation the assessees were which were not
explained nor are relevant to the present proceedings. Counsel had also
place done record certified final accounts showing considerable losses and
pleads inability to deposit and amount.
5. With the view on these three aspects of the case we grant
unconditional waiver of pre-deposit of duty confirmed and penalties
imposed and stay recovery thereof during the pendency of the appeal.