{"id":24894,"date":"2005-02-25T00:00:00","date_gmt":"2005-02-24T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/mahalakshmi-jewellery-ltd-vs-commissioner-of-customs-on-25-february-2005"},"modified":"2017-06-29T06:29:46","modified_gmt":"2017-06-29T00:59:46","slug":"mahalakshmi-jewellery-ltd-vs-commissioner-of-customs-on-25-february-2005","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/mahalakshmi-jewellery-ltd-vs-commissioner-of-customs-on-25-february-2005","title":{"rendered":"Mahalakshmi Jewellery Ltd. vs Commissioner Of Customs on 25 February, 2005"},"content":{"rendered":"<div class=\"docsource_main\">Customs, Excise and Gold Tribunal &#8211; Bangalore<\/div>\n<div class=\"doc_title\">Mahalakshmi Jewellery Ltd. vs Commissioner Of Customs on 25 February, 2005<\/div>\n<div class=\"doc_citations\">Equivalent citations: 2006 (193) ELT 118 Tri Bang<\/div>\n<div class=\"doc_bench\">Bench: J Balasundaram, Vice-, A M Moheb<\/div>\n<\/p>\n<pre><\/pre>\n<p>ORDER<\/p>\n<p>Moheb Ali M., Member (T)<\/p>\n<p>1. These appeals arose out of the order of the Commissioner of Customs, Cochin. The appellant company is an unit in CEPZ.\n<\/p>\n<p>2. Briefly the facts are that the appellant company imported capital goods worth Rs. 50,12,426\/- and cleared the same without payment of duty under notification 256\/87-Cus. on execution of a bond binding itself to pay the duty foregone if the capital goods are not put to use in the production of jewellery for export as per the condition of the said notification. The allegation is that the appellant failed to fulfil the condition of the notification inasmuch as he failed to use the capital goods for the manufacture of the export goods. In the impugned order, the Commissioner confiscated the goods, imposed a redemption fine of Rs. 25 lakhs and imposed a penalty of Rs. 5 lakhs on the Managing Director of the appellant company M\/s. Mahalakshmi Jewellery Ltd. Confiscation is under Section 111(o) and penalty is under Section 112 of the Customs Act. Hence the appeals.\n<\/p>\n<p>3. Heard both sides.\n<\/p>\n<p>4. The learned advocate submits that the Circular No. 21\/95, dated 10-3-1995 and 122\/95, dated 28-11-1995 stipulate that adjudication should be proceeded with only after the Development Commissioner, CEPZ in charge of EOU has been intimated about the violation. In support, the appellant relied on Vishal Footwear Ltd. v. CC, New Delhi  and Kuntal Granites (P) Ltd. [Final Order No. 332\/2001 dated 1-3-2001 (SZB),  (T)]. The Commissioner is bound to follow the circular, it was argued; that the show cause notice is premature as the commercial production commenced on 9-7-1993 whereas the show cause notice was issued on 13-2-1996; that the export policy as well as the general bond signed by the appellant require the target to be achieved in five years; that the notice alleging non-compliance of conditions as per Notification 256\/87 ought to have been issued after five years from the date of commencement of commercial production, i.e. 9-7-1993 and the export obligation could not be achieved for reasons beyond their control.\n<\/p>\n<p>5. The learned DR argued that when the conditions of notification under which duty free clearance is allowed are violated, the department has a right to invoke the provisions of the bond executed by an importer; that the Circular relied upon does not restrict the department to proceed to recover duty foregone; that the show cause notice clearly brings out the violation; that the Development Commissioner himself has started eviction proceedings against the appellant company and therefore is aware that the unit failed to fulfil the obligation cast upon it and that both the Development Commissioner as well as the Customs department are aware of the violations. He argued that in such circumstances, it is not open to the appellant to argue that the department should have intimated the Development Commissioner before initiating proceedings under the Customs Act.\n<\/p>\n<p>6. We observe that the Development Commissioner in this case itself adjudicated the case before him and imposed penalties for violation of the policy under which the goods were allowed to be imported. The Board&#8217;s circular in question is issued so that premature action is not taken by the department as the Development Commissioner is empowered to extend the period of export obligation. In the present case, no such extension was given nor was contemplated when the adjudication proceedings were initiated by the department. The Revenue is well within its competence to issue notice and proceed for confiscation under Section 111(o) of the Customs Act. We do not find any infirmity in the order. However, having regard to the financial condition of the appellant and the attending circumstances, we modify the orders as under. Redemption fine is reduced to Rs. 5 lakhs. Personal penalty on the Managing Director is reduced to Rs. 25,000\/-.\n<\/p>\n<p>7. The appeals thus are allowed partly.\n<\/p>\n<p>(Operative part pronounced in Court)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Customs, Excise and Gold Tribunal &#8211; Bangalore Mahalakshmi Jewellery Ltd. vs Commissioner Of Customs on 25 February, 2005 Equivalent citations: 2006 (193) ELT 118 Tri Bang Bench: J Balasundaram, Vice-, A M Moheb ORDER Moheb Ali M., Member (T) 1. These appeals arose out of the order of the Commissioner of Customs, Cochin. The appellant [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-24894","post","type-post","status-publish","format-standard","hentry","category-judgements"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Mahalakshmi Jewellery Ltd. vs Commissioner Of Customs on 25 February, 2005 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/mahalakshmi-jewellery-ltd-vs-commissioner-of-customs-on-25-february-2005\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Mahalakshmi Jewellery Ltd. vs Commissioner Of Customs on 25 February, 2005 - Free Judgements of Supreme Court &amp; 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