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M/s. Adani Wilmar Limited, Shri Devan Mehta, Shri Chetan R. Thakkar Versus Commissioner of Customs, Jamnagar (Prev.)

Utilisation of Excess credit limit, under DEPB Denial of benefit of exemption Notification No. 45/2002-Cus Importer imported consignment of Crude Palm Oil and cleared goods on basis of Telegraphic Release Advice (TRA), issued vide Customs House and Duty Entitlement Pass Book (DEPB) Licenses During investigation DRI found that importer had utilised excess credit, in violation of condition of DEPB License Adjudicating authority denied benefit of exemption Notification No. 45/2002-Cus and c .....

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and restriction of use was categorically mentioned therein Lapse on part of Customs authorities to mention same on TRAs, would not waive penal consequences on importer Hence, imposition of penalty on importer is warranted Appeal filed by importer dismissed Decided against Importer.

There is no evidence available on record that Custom House Agents was aware of alleged irregularity Adjudicating authority observed that appellant has breached conditions of CHA Regulation, 2004 .....

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ondent : Shri Alok Srivastava, Authorised Representative ORDER Per : Mr. P.K. Das; These appeals are arising out of a common order and therefore, all are taken up together for disposal. 2. The relevant facts of the case, in brief, are that M/s. Adani Wilmar Limited (in short Importer) had imported a consignment of Crude Palm Oil (in short CPO) per vessel MT ERMAR at Gujarat Adani Port Limited, Mundra. They have cleared the goods on the basis of Telegraphic Release Advice (TRA), issued vide Custo .....

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of the condition of DEPB License read with policy Circular No. 26 (RE-99) dated 09.8.1999 in respect of imported goods weighing 283.037 MTs lying in the Port, which was detained by the DRI officers. Subsequently the seized goods were released subject to 20% of the goods were detained for TRA verification. 3. A show cause notice dated 19.7.2005 was issued proposing demand of duty alongwith interest and to impose penalty on the importer and to impose penalty on the co-noticees. By the impugned or .....

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anager of M/s. NFPL, Gandhidham (CHA) and Shri Deven Mehta, Proprietor of Ami Impex, Mumbai, who sold the license to the importer. 4. Shri Hardik Modh and Shri Rahul Gajera, learned Advocates are appearing on behalf of the importer and Custom House Agent respectively. None appears on behalf of Shri Deven Mehta. There is no application for adjournment. Hence we proceed to decide all the appeals. 5. Shri Hardik Modh, learned Advocate on behalf of the importer submits that the appellant cleared the .....

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of duty cannot be sustained on the basis of Hand Book of Procedure and it cannot go beyond the Policy and Notification. TRAs are at par with DEPB license and relied upon the decision in the case of Tata Iron and Steel Company Limited vs. Commissioner of Customs, (Air Port), Kolkata 2003 (154) ELT 477 (Tri. Kolkata). Regarding Hand-book procedure cannot go beyond the Policy and exemption notification, he relied upon the following decisions:- (a) Hemani Industries vs. Commissioner of Customs, Cal .....

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aware of the condition of the DEPB scrip and he drew the attention of the Bench to Para 1.18.4 of the adjudication order. It is submitted that the findings of the adjudicating authority in respect of imposition of penalty on the importer, are contrary to the records. It is submitted that they have claimed exemption and it is the duty of the department to examine eligibility of exemption and there is no intention to evade payment of duty. He relied upon the decision of the Hon'ble Supreme Cou .....

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e Customs Act. It is submitted that there is no material available that the appellant is involved in alleged irregularity. He relied upon the decision of the Tribunal in the case of World Cargo Movers vs. Commissioner of Customs, New Delhi 2002 (139) ELT 408 (Tri. Del.) and Prime Forwarders vs. Commissioner of Customs, Kandla 2008 (222) ELT 137 (Tri. Ahmd.). 8. The Learned Authorised Representative on behalf of the Revenue submits that there is no conflict between the Hand Book, Policy and exemp .....

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e sustained. He submits that all the appellants were directly involved for availing irregular DEPB credit and the penalties were rightly imposed. 9. After hearing both the sides and on perusal of the records, we find that Para 4.3 of the Policy provides, the objective of DEPB is to neutralise the incidence of customs duty on the import content of the export product. The neutralisation shall be provided by way of grant of duty credit against the export product. The Notification No. 45/2002-Cus al .....

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ch person. The main contention of the learned Advocate is that the appellant purchased the DEPB from open market and the Customs authorities issued TRAs on the basis of DEPB license and there is no indication of restriction of DEPB credit. In this context, Hand Book of Procedures, Part-II (2002-2007), Para 4.46 of Chapter 4 provides as under:- 4.46. Restriction on use of DEPB Credit. The CIF value of imports affected under the DEPB shall not exceed the FOB value against which the DEPB has been i .....

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th the submissions of the learned Authorised Representative for the Revenue that the restriction to use of DEPB credit is not beyond the Policy and notification. Hence, there is no need to discuss the case laws relied upon by the learned Advocate. The demand of duty alongwith interest on the importer is sustainable. 10. We find from the adjudication order that all the DEPB licenses have an endorsement that CIF value of imports effected under this DEPB shall not exceed the FOB value against which .....

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As, would not waive the penal consequences on the importer. Hence, imposition of penalty on the importer is warranted. Learned Advocate strongly relied upon the decision of the Hon'ble Supreme Court in the case of Northern Plastics Limited (supra). In that case, it has been observed that where the appellant was entitled to get the benefit of exemption under the notification, was a matter of belief of the appellant and not a matter of any other particular with respect to the goods. In the pre .....

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