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TMI Blog2013 (9) TMI 999X X X X Extracts X X X X X X X X Extracts X X X X ..... under Rule 19(2) of the Central Excise Rules, 2002. The use of duty free Hexane was admitted by the Works Manager of the manufacturer in his statement. Accordingly, the Joint Director, DGCEI, Indore issued a show cause notice on 6-10-2010 which was subsequently adjudicated by adjudicating authority vide the impugned Order-in-Original wherein he ordered for recovery of drawback amount to the tune of Rs. 94,052/- and imposed penalty. 3. Being aggrieved by the said Order-in-Original the party filed appeal before Commissioner (Appeals), who set aside the Order-in-Original and allowed the appeal. 4. Being aggrieved by the impugned Order-in-Appeal, the applicant department has filed this revision application, under Section 129DD of Customs Act, 1962 before Central Government on the following grounds : 4.1 It is stated and submitted that the Appellate Order is not legal and proper inasmuch as the appellate authority while passing the Appellate Order have grossly erred and brushed aside and ignored all the statutory provisions, settled legal position and even ignored the clarification dated 4-1-2012 issued by the office of the Drawback Commissioner, C.B.E. & C., New Delhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y in the case of Sterling Agro reported in 2011 (269) E.L.T. 113 (G.O.I.) wherein at Para 15 the Revisionary Authority has categorically held as under :- "15. In view of the above discussion and findings, Government, finds that the applicant by way of procuring duty free inputs under Rule 19(2) of Central Excise Rules, 2002 has contravened the clause (ii) of the second proviso to Rule 3(1) of the Central Excise Drawback Rules, 1995 [also condition 7(f) of Notification No. 68/2007-Cus. (N.T.) and Condition No. 8(f) of Notification No. 103/2008-Cus. (N.T.)] and therefore no drawback is admissible in this case. As such, Government finds no infirmity in the impugned orders and upholds the same." The above decision of the Revision Authority is squarely applicable from the facts and circumstances of the present case. 4.5 The following judgments are also relevant in the present case : * The constitution/or Bench of the Hon'ble Apex Court in the case of Shyam Sundar v. Ram Kumar (Civil Appeal No. 4680/1993) * On merit of the admissibility of Drawback also the Hon'ble Supreme Court in the case of Rubfila ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontrary to the materials on record. The order of the Commissioner of Customs (Appeals), Jamnagar is prima facie as well as factually incorrect and, therefore, is legally not sustainable. The same, therefore, deserves to be set aside. 5. A show cause notice was issued to the respondent under Section 129DD of Customs Act, 1962 to file their counter reply. No reply is received till date. 6. Personal hearing scheduled in this case on 7-8-2013 was attended by Shri N.K. Tiwari, Consultant on behalf of the respondents and reiterated the grounds of revision application. 7. Government has carefully gone through the relevant case records and perused the impugned Order-in-Original and Order-in-Appeal. 8. On perusal of records, Government observes that in the instant case M/s. Pradip Overseas, Ahmedabad has exported Soya De Oiled Cake (DOC) from Bedi Port Jamnagar as a merchant-exporter under duty drawback scheme. The DOC was procured from manufacturer M/s. Rama Phosphate Ltd., Indore who has used raw material Hexane which was procured without payment of duty under Rule 19(2) of Central Excise Rules, 2002. As per the relevant drawback notification prevailing at that tim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Certificate Licence issued in terms of Notification No. 90/2004-Customs, dated the 10th September, 2004, drawback at the rate equivalent to Central Excise allocation of rate of drawback specified in the said Schedule shall be admissible subject to the conditions specified therein; (c) manufactured or exported by a unit licensed as hundred per cent. Export Oriented Unit in terms of the provisions of the relevant Export and Import Policy and the Foreign Trade Policy; (d) manufactured or exported by any of the units situated in free trade zones or export processing zones or special economic zones; (e) manufactured or exported by availing the rebate of duty paid on materials used in the manufacture or processing of such commodity or product in terms of Rule 18 of the Central Excise Rules, 2002; (f) manufactured or exported in terms of sub-rule (2) of Rule 19 of the Central Excise Rules, 2002." The above provisions clearly state that drawback will not be admissible if facility under Rule 19(2) was availed. In this case manufacturer M/s. Rama Phosphate, Indore has availed facility o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vernment therefore holds that Commissioner (Appeals) has erred in making the said notification and circular applicable to export made prior to 20-9-2010. As such, the duty drawback benefit is not admissible in the instant case. Original authority had rightly ordered for recovery of said duty drawback amount along with interest. 11. As regard pleadings of the department for imposition of penalty, Government notes that the respondent had concealed the fact of procuring raw materials duty free under Rule 19(2). Therefore they are liable to penal action and Government agrees with the findings of original authority to this extent. Keeping in view the overall circumstances of the case the ends of justice will be met by imposing penalty under Section 114(iii)/114AAA of Customs Act, 1962. Government therefore imposes the penalty of Rs. 25,000/-, and Rs. 25,000/- on M/s. Pradip Overseas Ltd., Ahemedabad, and Sh. Pradip Keria, M.D. of M/s. Pradip Overseas respectively. The revision application No. 380/56/DBK/13 filed by department where M/s. Rama Phosphate Ltd. are the respondents, is still pending and will be decided separately in due course as regards imposition of penalty on them. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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