2000 (2) TMI 523 - AT - Customs

Summary

Issues:
1. Confirmation of duty amount under Section 28 of the Customs Act, 1962.
2. Confiscation of imported capital goods under Section 111(o) and penalty imposition under Section 112A.
3. Extension of validity of the 100% Export Oriented Unit (EOU) scheme by the Ministry of Industries.
4. Consideration of legal schemes by the Ministry of Industries and Ministry of Finance.
5. Review of the Order-in-Original by the Commissioner of Customs in light of the extended validity of the EOU scheme.

Analysis:
1. The appeal challenged the confirmation of duty amount under Section 28 of the Customs Act, 1962, along with interest, and the confiscation of imported capital goods valued at Rs. 3,81,15,836 under Section 111(o) with a redemption fine of Rs. 50,000. Additionally, a penalty of Rs. 45,000 was imposed under Section 112A. The appellants failed to install the capital goods within the EOU scheme period, leading to the demand for duty payment.

2. The Ministry of Industries extended the validity of the EOU scheme for the appellants, indicating a willingness to consider further extensions. The legal authority for the EOU scheme lies with the Ministry of Industries, while the Customs Act governs the Customs provisions. The Tribunal emphasized the need to consider both legal schemes holistically and remanded the matter to the Commissioner for a fresh review in light of the extended validity, ensuring justice and preventing injury to the appellants.

3. The Tribunal highlighted that the Ministry of Industries' extension of the EOU scheme's validity must not be disregarded, as it would defeat the scheme's purpose and economic benefits. The Commissioner was directed to conduct a de novo consideration, taking into account the extended letter of intent. The urgency of timely proceedings was stressed to avoid unnecessary delays, emphasizing the importance of upholding the legal authority granted by the Ministry of Industries.

4. Due to the significant impact of the extended validity on the case, the Tribunal granted waiver and stay of the pre-deposit, allowing the appeal to proceed efficiently. The decision underscored the need for a comprehensive reassessment by the Commissioner, considering all aspects and the new information provided by the Ministry of Industries regarding the EOU scheme's extension.