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2023 (6) TMI 299 - AT - Central Excise100% EOU - extended period of limitation - demand of duty under the wrong provisions - import of raw-material Polypropylene from Singapore for use in manufacture for the final product - applicability of N/N. 5/94-CUS read with Notification No. 52/2003-CUS dated 31.03.2003 read with Section 9A (2A) (ii) of Customs Tariff Act 1975 - penalty u/s 112 of Customs Act 1962 - HELD THAT - In view of specific amendment brought in 2008 in the statutory provisions Anti Dumping Duty was clearly chargeable even if the impugned raw-material was contained in the finished goods cleared in DTA. Notwithstanding the decisions of the prior period the Anti Dumping Duty was required to be paid by the appellant. It is found that though the show cause notice has not demanded duty under the provision of Central Excise Act particularly under section 3 and Notification No. 23/2003-CE dated 31.03.2003 but has still demanded the same as per calculations of aggregate Customs Duty which are the borrowed machinery provisions under section 3 of Central Excise Act 1944. The lapse on the part of the department is not such which has denied any natural justice to the appellant. As they were aware of the nature of duty sought to be charged being under Section 3 of Central Excise Act 1944 as is clear from their submissions made before the adjudicating authority same therefore on merits is sustainable. However on the point of limitation the appellants had reflected all their transactions in their books of account only. Same could be detected on the basis of record by the visiting audit party. It is also found that the rejection of the plea relating to earlier periodic audits of the appellants by the adjudicating authority is not sustainable. Simply stating that audit does not check thoroughly but only on selected basis is nothing but exercise of undermining the purpose of departmental audit. It also does not bring on record as to what records were checked/not checked by the audit while giving such findings. It is also found that department while demanding duty was not sure of the provision of law under which the same had to be demanded and even the penalty has been imposed under Section 112 of Customs Act 1962 whereas the duty should have been demanded under Central Excise Act and penalty imposed under Central Excise Act/ Rules only. The demand can be sustained only for the normal period of limitation and that penalty under section 112 of Customs Act 1962 does not sustain. Appeal is accordingly partly allowed.
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