ORDER
Moheb Ali M., Member (T)
1. The stay application came up for hearing on 30.9.2003. With the consent of both sides if was found possible to dispose of the main appeal itself. Accordingly pre deposit of duty and penalty confirmed and levied respectively by the Ld. Commissioner in his adjudication order dated 31.12.2002 is waived and the appeal taken up for disposal.
2. The appellant obtained an EPCG lie for import of capital goods and claimed the benefit of Notification No. 29/97 customs. The said notification permits goods, imported under the Zero duty EPCG licence, to be cleared at zero duty of customs and 10% additional duty leviable thereon under Section 3 of the Customs Tariff Act with a rider that the importer imports Rs. 20 crores worth of permissible goods under the licence within the validity period. The consequence of not importing goods valued at Rs. 20 crores is that the benefit of notification could be denied and the importer could be penalised for claiming the inadmissible benefit. In addition the goods become liable to confiscation under Section 111(o) of the Customs Act.
3. The appellant failed to import goods worth Rs. 20 crores, during the validity of the licence and thus contravened the provisions of the licence as well as the ones of Notification No. 29/97 customs. He imported goods valued merely at Rs. 11,25,87,368/- and Rs. 11,35,73,481 Assessable value upto 13.1.2001 through New Customs House, Mumbai and the Jawahar Customs House, Nhava Sheva a case of not fulfilling the import obligation cast under the licence and the notification in question.
4. The appellant had been pleading with DGFT arid Union Minister of State for commerce from Oct. 15, 2001 to condone the shortfall in imports and allow him to fulfil the export obligation as if he had imported capital goods worth Rs. 20 crores. This request was firmly rejected by the DGFT in their letter dated 28.11.01. But the appellant pursued his request with some tenacity this time with Union Minister for commerce, Revenue Secretary, DGFT etc. till at last he was again told on 30.6.2003 that his request cannot be agreed to (DGFTs letter dated 30.6.2003). The appellant then changed tack and requested the DGFT authorities to be at least good enough to consider conversion of his zero duty licence into 10% EPCG scheme (there are schemes and scheme) as they have fulfilled the Provisions of the latter scheme (para 6.11 (a) of the relevant HB of procedure). This time he met with success. Finally by their letter dated 8.9.2003 the DGFT communicated to the appellant that his request for conversion from zero duty to 10% duty scheme of EPCG was exceeded to by EPCG committee. This was on 8.9.2003.
5. By then the Ld. Commissioner adjudicated the case and held that the present appellant failed to fulfil the condition of EPCG licence as well as the condition of Notification No. 29/97 customs and demanded the consequent duty, confiscated the goods and imposed a penalty. This was on 31.12.2002, a date prior to the decision of EPCG Committee to convert the original licence to 10% duty licence scheme.
6. The Ld. Advocate of the appellants pleaded that the Commissioner adjudicated the case despite their request to hold on till their request for conversion to 10% duty scheme was disposed of by DGFT authority and therefore the matter be remanded to the Ld. Commissioner for a fresh decision taking into consideration the DGFT letter dated 8th September 2003. We find considerable force in this plea. After hearing both sides we remand the case back to the Commissioner with the following directions.
7. The Commissioner may adjudicate the case afresh after taking into consideration the fact that DGFT authorities have permitted the conversion of the original licence under which goods were imported into 10% duty EPCG scheme and lake a decision in accordance with law.
8. The stay application and the appeal are thus disposed of by way of remand.