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2005 (8) TMI 223 - AT - CustomsDemand (Customs) - interest and penalty - Bonded Warehoused goods - department seeking details of goods in working and non-working condition - HELD THAT:- We find that the appellants are not contesting the duty liability appropriated by the department with regard to an amount of Rs 1,89,120/-, the contest is to the extent of Rs. 19,90,450/- which has been appropriated by the Department even before the issuance of show cause notice. The contention of the assessee has already been noted supra that they have abandoned the goods when their application for extension of warehousing period was still subsisting and hence question of paying duty, interest and penalty does not arise. It is seen from the judgment of CCE v. Garden Silk Mills Ltd.[1999 (12) TMI 280 - CEGAT, MUMBAI] and Mafatlal fine Spinning Mills [1986 (12) TMI 33 - HIGH COURT OF JUDICATURE AT BOMBAY] that the demand of duty is invalid when importer relinquishes his title to ownership of goods before the order of clearance for home consumption is passed, even if the warehousing period has expired. As the appellants have abandoned the goods on 3-9-03 even before the issuance of an order for home clearance was made or demands raised in the show cause notice, therefore in terms of these two judgments of the Tribunal and Bombay High Court, the appellants contention is required to be accepted by setting aside the order demanding duty of Rs 19,90,450/-. The Kesoram Reyons case [1996 (8) TMI 109 - SUPREME COURT] deals only with the question of rate of duty at the time of clearance of warehoused goods. It does not pertain to abandonment of title of goods and liability to pay duty. The reliance of learned Commissioner on this judgment is not proper. In the light of the judgments cited by the appellants the confirmation of demand on the goods which were abandoned is not proper and is required to be set side. As the duty is not demandable on abandoned goods, therefore the prayer of the appellant for setting aside the interest and penalty is justified in the light of subsequent judgment on this point rendered in the case of Rashtriya Ispat Nigam Ltd. [2003 (5) TMI 509 - SC ORDER], the appellants appeal and the prayer made is accepted. Appeal is allowed with consequential relief, if any.
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