TMI Blog2010 (8) TMI 320X X X X Extracts X X X X X X X X Extracts X X X X ..... plied, the appellant having made a false claim to the extent of the excise duty component of drawback, the provisions of Section 28 of the Act would also be squarely attracted. - 1724 of 2009 - - - Dated:- 12-8-2010 - D.A. Mehta and H.N. Devani, JJ. REPRESENTED BY : Shri Uday Joshi, Advocate, M/s. Trivedi Gupta, for the Appellant. [Judgment per : H.N. Devani, J. (Oral)] In this appeal under Section 130 of the Customs Act, 1961 (the Act), the appellant-assessee has challenged order dated7-5-2008[2008 (228) E.L.T. 205 (Tri.-Ahmd.)] made by the Customs, Excise Service Tax Appellate Tribunal (the Tribunal), proposing the following five questions : [a] Whether in the facts and circumstances of the case, the Tribunal erred in not appreciating that the contents of the test report dated 27-6-2010 pertaining to samples drawn on 29-5-2000 could not have been considered and relied upon for the purpose of coming to a conclusion as regards goods exported much prior thereto, i.e. between 24-1-2000 to 31-3-2000? [b] Whether in the facts and circumstances of the case, the Tribunal erred in holding that the drawback sanctioned was liable to recovery under Rule 16 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udicated vide Order in Original dated26-12-2003whereby the demands raised therein came to be confirmed along with rejection of drawback claim. A penalty of Rs. 5 lacs also came to be imposed on the appellant and the goods in question were ordered to be confiscated. Against the said order, the assessee preferred appeal before the Tribunal which came to be decided vide the impugned order dated7-5-2008whereby, the impugned order came to be upheld except for reduction of penalty from Rs. 5 lacs to Rs. 3 lacs. 3. Mr. Uday Joshi, learned advocate for the appellant vehemently assailed the impugned order of the Tribunal, submitting that the basis of the show cause notice is the test report indicating that the goods exported by the petitioner can be considered as heat resistant rubber elastic tape and not heat resistant rubber tension tape as described in the Drawback Schedule. Adverting to the facts of the case, it was pointed out that in the present case, the test report as regards the sample drawn on 29-5-2000 relating to the shipping bills dated 29-5-2000 has been made applicable to goods already exported by the appellant under cover of 18 shipping bills filed for export of goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cturer of said export goods. The said unit did not have any plant and machinery and did not exist at the given address. They had misstated to the Central Excise Authorities as admitted by Shri C.P. Gupta, Director of the company in his statements made before the Customs Authorities that they had not manufactured any goods and had only issued invoices as paper transactions for 1/2% commission in connivance with Shri K. K. Jain. [ii] Shri C.P. Gupta, Director of M/s. Ratan Lila Co. Ltd. in his statement dated20-9-2000claimed that no machinery is required for manufacture of Heat Resistant Rubber Elastic Tape except scissors. Contrary to this, they themselves had declared in the declaration under Rule 173B of Central Excise Rules, 1944 (the C. E. Rules) filed with Central Excise authorities that extruder is required for manufacture of Heat Resistant Rubber Elastic Tape. [iii] Though extruder is required for manufacture of Heat Resistant Rubber Elastic Tape as mentioned in the declaration filed under Rule 173B of the C. E. Rules, the same was never installed in the factory of the manufacturer M/s. Ratan Lila Co. Ltd. as confirmed in the affidavit dated 24-12-96 filed by the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sued to the appellant. The adjudicating authority, that is, Commissioner of Customs, Customs House, Kandla, in his order dated26-12-2003, upon appreciation of the evidence on record, recorded the following findings : M/s. Ratan Lila Company Ltd. had filed declaration with effect from 1-4-2000 under the provisions of Rule 173B of the erstwhile Central Excise Rules, 1944 with the Jurisdictional Assistant Commissioner, wherein while declaring the process of manufacture, they had declared that the materials required for manufacture of heat resistant rubber are required to pass through the extruder , which meant that the extruder was an essential machinery for manufacture of heat resistant rubber. However, in the affidavit dated24-12-1996made by Shri C. P. Gupta, Director of M/s. Ratan Lila Company Ltd., he had declared the list of machinery installed by them which did not reveal installation of any such extruder in their factory premises. When the extruder required for manufacture of heat resistant rubber tape was not at all installed in the factory premises of M/s. Ratan Lila Company Ltd., the alleged goods could not have been manufactured at their premises. The evidence o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es and Shipping Bills. As per the Duty Drawback Schedule, the goods should be Head Resistant Rubber Tension Tape for admissibility of duty drawback. In other words, for entitlement of duty drawback, the goods should be Tension Tape. But, neither the documents submitted at the time of export nor the Chemical Examiner s test report confirmed the description Heat Resistant Rubber Tension Tape (Strip Rubber Elastic) as described in the Schedule to the Duty Drawback. This means, the goods which were removed for export by the appellant had no characteristics of tension and/or elastic , but they were merely Heat Resistant Rubber Tape . The tension/elastic rubber tape and simple rubber tape both have distinct use and characteristics. Thus, though the goods in question had no tension/elastic characteristics, the appellant suppressed the material facts from the department and with an intent to mislead the department used the word elastic in the description of the goods declared to the department so as to enable them to claim and get the duty drawback. The record reveals that as per the Bank Realization Certificates provided by the appellant, the goods were Head Resistant Rubber ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d bottle sealing machine, bottle filling machine, mixer (stirrer), bottle drying machine and one Avery weighing scale but no extruder. In the show cause notice dated1-4-2000, it had been alleged that M/s. Ratan Lila Company Ltd. could not have manufactured the product without extruder. The Tribunal also noted that Shri C. P. Gupta, Director, in his statement dated 20-9-2000, had explained that they need only scissors for the manufacturing process while explaining the process; that Shri K.K. Jain had not been traced and no statement had been recorded till date. According to the Tribunal it was quite clear that M/s. Ratan Lila Company Ltd. did not have the facility to manufacture the product. The Tribunal also took note of the fact that Shri V. M. Jain had stated that he had never seen the factory and that he was not aware of that the goods had been sent from Delhi and found it strange that the exporter who had exported the goods under 22 consignments had not even bothered to get the facility available verified to ensure the quality of the product manufactured by them. 8. In the light of the aforesaid findings recorded by it, the Tribunal was of the view that whatever was manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the descriptions given in the shipping bills tallied with the goods actually exported. However, as per the Drawback Schedule, the goods entitled to drawback were Heat Resistant Rubber Tension Tape (Strip Elastic Rubber) and not Heat Resistant Rubber Tape which were the goods exported by the appellant. Thus, despite the fact that the goods exported by the appellant were not eligible for drawback, the appellant had filed a false drawback claim in respect of the said goods. According to the learned advocate for the appellant, since there is no customs duty involved in the present case, there is no question of having made a false claim for drawback. However, from the facts emerging on record, it is apparent that the appellant has claimed drawback also on the excise duty component of the goods exported. From the facts noted hereinabove, it is apparent that there was no supporting manufacturer and that the appellant had purchased the goods from the market, in the circumstances, the drawback claim in relation to the excise duty component of the exported goods was certainly false. 11. Another contention advanced on behalf of the appellant is that in the light of the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Drawback Schedule. As to whether the goods exported by the appellant are Heat Resistant Rubber Tension Tape , as specified in the Drawback Schedule or otherwise, is a pure question of fact. On behalf of the appellant, nothing has been pointed out to indicate that the findings recorded by both the authorities below are in any manner unreasonable or perverse or that the same are contrary to the material on record so as to dislodge the concurrent findings of fact recorded by the Tribunal. In the circumstances, the said contention also does not merit acceptance. 14. As regards the contention that the test report pertaining to samples drawn on 29-10-2000 could not have been relied upon in relation to goods exported prior thereto between 24-1-2000 to 31-3-2000, from the evidence on record as well as the concurrent findings recorded by the authorities below, it is apparent that even at the time of prior export of the goods, the same had been obtained from M/s. Ratan Lila Company Ltd., which, in the light of the findings of fact recorded hereinabove, was not at any point of time manufacturing the goods in question and as such, it is apparent that the goods exported between the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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