TMI Blog2008 (7) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... Kumar, Member (T) Shri J.M. Sharma, Consultant, for the Appellant. Shri R.C. Sankhla, DR, for the Respondent. [Order per: Rakesh Kumar, Member (T)]. - The main appellants-M/s. L.R. Brothers, Indo Flora Ltd., Rasulpur, Saharanpur are a floriculture 100% EOU, who started their operation in June, 1996 on the basis of LOP No. Per/119 (1994)/EOB/84/94 dated 4-5-94 issued by the Secretariat for Industrial Approvals (EOU Section), Deptt. of Industrial Development, Ministry of Industry, New Delhi. The other appellants-Shri Vijay Kumar Garg, Mrs. Vijaya Garg and Shri Anupam Sushil Garg are the Managing Director/Directors of this company. The appellant-company had imported capital goods involving Customs Duty of Rs. 6,78,63,747/- free of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant company as under: Shri Vijay Kumar Garg Rs. 25,000/- Mrs. Vijaya Garg Rs. 10,000/- Shri Anupam Sushil Garg Rs. 10,000/- The above duty demands were confirmed and the penalties were imposed on the ground that the appellant-company failed to meet the unit export obligation within the stipulated period and thereby violated the conditions subject for which duty free import of the capital goods and purchase of indigenously manufactured excisable goods free of Central Excise Duty had been allowed. 2. Heard both the sides. 3. Shri J.M. Sharma, Consultant, ld. Counsel on behalf of the appellant made the following submissions: (1) The duty demands have been confirme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Commissioner of Central Excise Customs, Meerut has informed the Commissioner that the appellant-company is presently undergoing rehabilitation and in view of this, the decision with regard to meeting the export obligation will be kept in abeyance. in view of this, the decision on part of the Commissioner that the appellant-company has failed to meet the export obligation and on this basic confirming the duty demand against them and imposing penalties and ordering confiscation of the capital goods is pre-mature and totally wrong. (2) The Commissioner has erred in prematurely confirming the duty demand without debonding of the unit by the Development Commissioner/Board of Approval. The duty on capital goods has to be confirmed only afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Notification No.136/94-CE. was subject to the condition of meeting the export obligation within the stipulated period and achieving the net positive foreign exchange earning and since both these conditions have not been fulfilled by the appellant-company, the Revenue is justified in confirming the duty demand, confiscating the goods under Section 111(o) of Customs Act and imposing penalties on the Managing Director and other Directors of the company under Section 112 of the Customs Act. 5. We have given careful consideration to the submissions of both the sides. There is no dispute about the fact that the duty exemption under Notification No. 126/94-Cus. and 136/94-C.E. is available subject to certain conditions -. i.e. meeting th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther goods lying in the factory premises of the 100% EOU. The matter has been examined by the Board in the context of an Audit objection and I am directed to say that the Board has taken a view that liability of customs duties on goods imported by 100% EOUs arises either at the stage of the unit being de-bonded or if any of the conditions of the exemption Notification No. 13/81, dated 9-2-81 has been violated or remains unfulfilled. In this regard, it is seen that one of the conditions of the exemption notification is that the importer exports out of India 100% or such other percentage, as maybe fixed by the Board of articles manufactured wholly or partly from the goods for the period stipulated by the Board or such extended period as may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner that M/s. L.R. Brothers Indo Flora Ltd., the appellant-company, is presently undergoing rehabilitation and was part of a study on sick floriculture units commissioned by APEDA in 2001 (through M/s. Tata Economic Consultancy Services -TECS) and in 2006 through M/s. A.F. Ferguson Co., that based on the report of Tata Economic Consultancy Services, a Committee on Floriculture was set up by the Government under the Chairmanship of DGFT for recommending a strategy for rehabilitation of sick floriculture units, that it has been decided that in order make the Indian Floriculture industry viable, it has to be nursed back to health through a Rehabilitation Package for the sick units as well as through other initiatives, and that since the un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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