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2013 (12) TMI 352 - AT - CustomsWaiver of pre deposit - Seller of DEPB Scrip inflated the value of the exported goods to get undue DEPB Scrip and sold it to Assessee - Import was made against that DEPB Scrip - Held that - there is no finding in the adjudication order that applicant connived with M/s. Rajat Pharmachem Ltd. to DEPB Scrip fraudulently. The duty liability is admitted by M/s. Rajat Pharmachem Ltd. before the settlement Commissioner and the same has been paid. In the absence of finding that applicant connived with M/s. Rajat Pharmachem Ltd, in obtaining the advance licence. Prima facie the applicant has a strong case, therefore the pre-deposit of interest and penalty is waived and recovery of the same is stayed during the pendency of the appeal - Stay granted.
Issues Involved:
Waiver of pre-deposit of interest and penalty for purchasing DEPB Scrip from the market obtained by another company, liability for penalty due to importing goods against DEPB Scrip obtained fraudulently, lack of finding of connivance with the company that obtained the DEPB Scrip fraudulently. Analysis: The applicant filed an application seeking waiver of pre-deposit of interest and penalty amounting to Rs.17,72,626. The contention put forth was that the DEPB Scrip was purchased from the market, originally obtained by another company, M/s. Rajat Pharmachem Ltd. It was alleged that the said company inflated the value of exported goods to acquire the DEPB Scrip, which was then sold to the applicant for import purposes. Notably, M/s. Rajat Pharma Ltd. admitted duty liability before the Settlement Commission and paid the duty. However, there was no finding in the impugned order indicating the applicant's connivance with M/s. Rajat Pharmachem Ltd. to obtain the DEPB Scrip. Therefore, the imposition of penalty was deemed unsustainable by the applicant. The Revenue, on the other hand, relied on the lower authority's findings to argue that the applicant took undue advantage by importing goods against the DEPB Scrip acquired fraudulently, hence making the applicant liable for penalty. Upon reviewing the adjudication order, it was observed that there was no explicit finding suggesting the applicant's involvement in fraudulent activities with M/s. Rajat Pharmachem Ltd. regarding the DEPB Scrip. Given that the duty liability was admitted and paid by the said company without any evidence of connivance with the applicant, it was considered that the applicant had a strong case. Consequently, the Tribunal decided to waive the pre-deposit of interest and penalty, staying the recovery during the appeal's pendency. In conclusion, the stay petition was allowed by the Tribunal, granting the applicant relief from the pre-deposit of interest and penalty during the ongoing appeal process.
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