TMI Blog2010 (7) TMI 456X X X X Extracts X X X X X X X X Extracts X X X X ..... cope of enquire and the summons issued under Section 108 of the Customs Act for effecting the enquiry such as these cannot be bad for the lack of jurisdiction. The Tribunal fell in error in permitting the clearance of the goods on merit rate. By doing so the Tribunal has virtually set at naught the purpose behind issuance of an exemption notification. If the Respondent is not an actual user he would not be entitled to utilize the license. The license having been secured by adopting fraudulent method would not confer any right on the importer and as such he cannot be allowed to plead any equity. Therefore we find that the order passed by the Tribunal is not sustainable and liable to be set aside. basis for discharge of the export obligation was existence of a factory, which does not exists, address given was a false address - false declaration and obtained a license, the importer cannot be permitted to say that the imported material is freely importable under OGL - Tribunal fell in error in permitting the clearance of the goods on merit rate - Respondent not an actual user he was not entitled to utilize the license - violation of a notification issued under the Customs Act - no e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 2,08,548 kgs. it is further contended that the petitioner has not produced export obligation, discharge certificate from the office of the first respondent and the Bank Guarantees executed by the petitioner, are those in terms of customs Notification No. 30/1997, by which the petitioner enjoyed exemption from payment of customs duty and upon failure to fulfill the export obligation, the petitioner himself is bound by the bond executed that the Bank Guarantee could be invoked. Therefore, the second respondent would contend that the Bank Guarantee is being invoked in terms of the bond executed, which is a statutory bond, pursuant to customs Notification No. 30/1997. It is further submitted that in the case of the petitioner, the Directorate of Revenue Intelligence, on receipt of specific intelligence that the stainless steel imported under the advance licenses were being misused and the duty free, imported raw material was diverted. Further, it is the case of the second respondent that when the DRI visited the petitioner s office premises, there is no such office functioning in the said premises for the past four years. Based on the out come of the investigation conducted by the DR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner. However, in the instant case, the fact appears that there has been violation of conditions of the notification itself as it is stated that the office premises of the petitioner does not exist in the place given in the licence, which would obviously mean that there were no manufacturing factories, in fact the Hon ble Division Bench of this Court in Commissioner of Customs (SEA), Chennai-I v. CESTAT, Chennai - 2009 (240) E.L.T. 166 considered the case, where advance licenses were obtained by misrepresentation without even having manufacturing facilities and the Hon ble Division Bench also took note of the independent powers of both the first respondent Department as well as the Customs Department and held that the claim of the department was justified. The following observations of the Hon ble Division Bench would very relevant for the purpose of this case :- 30. Now coming to the Judgment of the Division Bench of this Court in 2004 (177) E.L.T. 57 (Mad.) we find the Judgment would apply to the facts of the present case in its entirety, in the said case the writ Petitions were filed challenging the summons issued under Section 108 of the Customs Act. The Learned S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs duty. Therefore, in our opinion, the discharge of the export obligation per se cannot put an end to the whole story. 30. Insofar, as the second notification, Notification No. 30/97, is concerned, a similar provision regarding the export obligation also appears there. However, there appears to be a specific clause added., i.e. clause (vii), which is to the following effect : (vii) exempt materials shall not be disposed of or utilized in any manner except for utilization in discharge of export obligation nor for replenishment of such materials and the materials so replenished shall not be sold or transferred to any other person . Learned Senior Counsel appearing on behalf of the Department very heavily relies on this clause and says that it is in this direction that the enquiry has to be made. We agree with the Learned Senior counsel that there can be a scope of enquire and the summons issued under Section 108 of the Customs Act for effecting the enquiry such as these cannot be bad for the lack of jurisdiction. 33. It is to be noted that the Division Bench of this Court in a case of South India Exports as referred above held that even the discharge of the export obligat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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