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2015 (9) TMI 204 - BOMBAY HIGH COURT

2015 (9) TMI 204 - BOMBAY HIGH COURT - 2015 (321) E.L.T. 616 (Bom.) - Renewal/Encashment of Bank Guarantee – Finalization of Contract – Petitioner addressed letter to Respondent No.1 stating that since everything at Petitioner's end was complied with, assessment was required to be completed within sixty days and as such, requested for finalization of contract and further requested that renewal of bank guarantees may not be insisted upon – However, Respondent No.1 addressed letter to Respondent N .....

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ncerned party is done and inspite of that if assessment is not completed within period of six months, authorities will not insist upon renewal of bank guarantees –Aforesaid narration clearly shows that in Petitioner had done everything which is required to be done, even after that Respondent No.1 has not taken any steps for completing assessment –Therefore Petitioner cannot be penalized for non-compliance of direction and is entitled to benefit of circular issued by CBEC – Respondent Nos.1 and 2 .....

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s Court with a prayer for directing the Respondents not to insist upon renewal of bank guarantees and also for refund of cash deposit of ₹ 50 lacs to the Petitioner. 4. The Petitioner has also prayed for direction to Respondent Nos.1 and 2, restraining them from encashing the bank guarantees till the finalization of the project. 5. The Petitioner has approached this Court in peculiar facts. The contract of the Petitioner for expansion of its existing unit was registered in the Customs Hous .....

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horities by communication on 20th June, 2011 and 4th July, 2011. The Assistant Commissioner of Central Excise, Udupi who is having jurisdiction over the factory of the Petitioner informed Respondent No.1 on 20th July, 2011 regarding verification of the machineries received under project import and also regarding installation of the same in the Central Excise premises. On 17th August, 2011 the Petitioner addressed a letter to Respondent No.1 submitting copies of Bills of Entry, bank attested invo .....

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Petitioner had taken place after installation of the imported machinery and also requested for site verification certificate. On 24th December, 2012 the Assistant Commissioner of Central Excise submitted plant site verification report regarding installation of imported machinery and verifying that the same had been put into operation. On 7th February, 2014 Respondent No.1 approached Respondent No.2 - ICICI Bank Ltd. for extension of bank guarantees. On 21st February 2014 the Petitioner addresse .....

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uested for finalization of the contract and release of the bank guarantees and cash deposit. However, again a letter was addressed by Respondent No.1 to Respondent No.2 for renewal of the bank guarantees. In this premise, the Petitioner has approached this Court. 7. The learned counsel for the Petitioner submits that the Petitioner having done everything at its end, it is for the Respondents to finalize the assessment under Project Import Regulations within a period of sixty days. The learned co .....

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ed in 2000(115) E.L.T.42 (S.C.) and in the case of Collector of C. Ex, Vadodara v. Dhiren Chemical Industries reported in 2002 (139) E.L.T. 3 (S.C.) 8. Mr. Jetly on the contrary submits that the Petitioner claiming to be a small scale industry has submitted a recommendation letter of the Joint Director, Department of Industries and Commerce, Bangalore. It is submitted that since the project cost is more than ₹ 30 Crores, the Petitioner cannot be termed as a small scale industry and the rec .....

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ost is more than ₹ 5 Crores, the recommendation letter has to be given by the Central Government. Nodoubt, Clause 1 provides that all plants and projects under SSI Units, the sponsoring authority would be Director of Industries of the Concerned State. However, it must be noted that under Clause 2 which deals with all power plants and transmission projects, various sponsoring authorities have been notified in respect of various types of projects. It is to be noted that in some type of proje .....

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) which is annexed to the affidavit in reply of the Respondents would itself reveal that the Joint Director, Department of Industries and Commerce, Bangalore has stated that the project has been approved by the Government of Karnataka and necessary recommendation letter has also been issued. It is further to be noted that not only that but the Assistant Commissioner, Central Excise, Udupi, has himself vide communication dated 24th December, 2012 has informed that the Jurisdictional Range Officer .....

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eration. He has also given details regarding the production figures. 10. In so far as the second contention regarding the Bills of Entry being sent to various ports is concerned, if the Respondent authorities sit over the said Bills of Entry for years together, it cannot thereafter be heard to say that the verification of the Bills of Entry would take time and therefore, assessment cannot be completed. 11. It will be relevant to refer to the following portion of the circular No.22/2011-Customs d .....

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Board that finalization of assessments under Project imports should be completed within a period of 60 days from the date of submission of required documents by the importer. However, in exceptional circumstances where it is not possible to complete the finalization within the time limit for justifiable reasons, the time limit may be extended by the jurisdictional Commissioner of Customs for such further period as may be decided by him and for the reasons to be recorded in writing. 3.2 It may a .....

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hat the above said relaxation is applicable, only if all the required documents including certificate for installation of imported goods at the Plant / Project site, utilization of imported goods in the manufacture of declared goods etc. are submitted up to the satisfaction of proper officer for finalization of contract. The Commissioner shall therefore ensure that the aforesaid time limit for finalization of Project Imports under PIR, 1986 is adhered to in all cases, so that such finalization i .....

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stries reported in 2002 (139) E.L.T. 3 (S.C.) and the Apex Court in the case of Steel Authority of India v. Collector of Customs, Bombay reported in 2000(115) E.L.T.42 (S.C.) had in unequivocal terms held that the circulars issued by the Central Board of Excise and Customs are binding on all the sub-ordinate authorities. The aforesaid circular clearly provides that if everything which is required to be done at the end of the concerned party is done and inspite of that if the assessment is not co .....

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