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2010 (12) TMI 1151 - MADRAS HIGH COURTDetention of machinery - EPCG Scheme - detention on the ground that respondent did not fulfil the export obligations and exported only 1.5 per cent - Whether in the circumstances of the case, the Tribunal is correct in holding that the order of confiscation of the goods and imposition of penalty' is not correct, since it was beyond the control of the importer to fulfil export and there is no deliberate attempt to avail of N/N. 169/1990 making any misdeclaration? - Held that: - the machinery was installed at the factory and production of goods was also started in March, 1994 and that they could only meet the export obligation to the extent of 1.5 per cent. only and that the Department did not allege the first respondent-company made deliberate attempt to avail of the benefits and concluded that there was no material to doubt about the first respondent's bona fides. Therefore, the Tribunal based on the aforesaid facts held that there was no mens rea and further held that the confiscation of goods and imposition of penalty is not sustainable. Hence, the finding of fact given by the Tribunal cannot be interfered with and therefore the first question of law is answered against the appellant. Whether the Tribunal is right in holding that interest on duty foregone under N/N. 169/1990 cannot be demanded since there is no provision in the Customs Act, 1962? - Whether the duty foregone would be only a duty when there is a failure to fulfil the conditions stipulated in the exemption notification? - Held that: - The notification prescribed various conditions for availing of benefits. However it is seen that there was no provision in the notification to levy interest on the duty. Though the learned counsel for the appellant referred sub-section 18(3) of the Customs Act and contended that the importer is liable to pay interest as per the rate fixed under section 28AB of the Act, the same is liable to be rejected in view of the judgment of the hon'ble Supreme Court in Commissioner of Customs (Import) v. Jagdish Cancer Research Centre [2001 (8) TMI 113 - SUPREME COURT OF INDIA]. Circular No. 5/1997-Customs, dated March 14, 1997, which postulates interest at the rate of 24 per cent. as specified in relevant notification is not applicable to this case as the said circular would be applicable prospectively from March 14, 1997 only. A perusal of section 143 would reveal that it speaks about the advance licences relating to import of input and raw materials for manufacture and export. Paragraph 197 in Chapter XIV of the Duty Exemption Scheme for the Import and Export Policy (April, 1990 to March, 1993) speaks about advance licences. Whereas the first respondent's licence is covered by the EPCG scheme. The import of capital goods at concession rate of the customs duty was done by the first respondent as per paragraph 197 of the Import and Export Policy 1990-93. Therefore, section 143A is not applicable to the present case. Appeal dismissed - decided against appellant.
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