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2022 (6) TMI 558 - CESTAT MUMBAIDemand of Interest and penalty on amount already recovered towards duty foregone - advance licence scheme - import of sodium cyanide and dimethyl urea - non-qualified licence - N/N. 31/97-Cus dated 1st April 1997 and N/N. 96/93-Cus dated 2nd March 1993 - HELD THAT:- The interest liability on duty recovered subsequently may be under the authority of Customs Act, 1962, the relevant notification issued under section 25 of Customs Act, 1962 for implementing exemption or concession scheme in Foreign Trade Policy or by reference to such authorizing provision of the Foreign Trade Policy in the said notification; the essence is an authority, direct or remote, attributable to an empowering statute. There can be no doubt that such condition was not in existence at the time of import and the show cause notice is also conspicuously silent on the availability of section 28AB of Customs Act, 1962 for such charging. The licence and the exemption notification are silent on such contingent charging; the sole provision cited by lower authorities is paragraph 128 of Handbook of Procedures which can hardly be claimed as a statutory prescription of the Foreign Trade Policy. It is a beneficial provision that enables a licence-holder to lay claim to regularization for breach of fulfilment of target of export obligation subject to compliance with the conditions therein. That is an internal disposal by the competent authority under the Foreign Trade (Development & Regulation) Act, 1992 – a far cry from the proceedings leading to the order impugned – and not applicable to the present circumstances. It is clear that the appellant was not contracted, either directly or directly, to be liable for recovery of interest as laid down in COMMISSIONER OF CUSTOM VERSUS WIPRO LTD. [2011 (11) TMI 334 - KARNATAKA HIGH COURT] by the Hon’ble High Court of Karnataka. The charging of interest and imposition of penalty is set aside - Appeal is allowed.
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