TMI Blog2007 (10) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... ization of the imported raw material, officers of the Directorate of Revenue Intelligence (DRI), Hyderabad visited the respondent's factory and office premises on 11-6-98, conducted verification of the stocks in the factory as also scrutiny of records, whereupon it was found that the respondents had exported only 273.950 MTs of steel bars and rods valued at Rs. 38,30,638/- during the period 1995 - 98 against the export obligation of 1000 MTs for a value of Rs. 3.15 crores. No stock of raw material was found in the factory to manufacture the balance quantity of steel bars and rods [726.050 MTs] required for completing exports under the above scheme. The books of accounts, registers and documents were recovered and verification of stock made under a mahazar. In terms of the standard input-output norms laid down in the Handbook of Procedures - Volume-II under the relevant EXIM Policy, the investigators estimated that 2826.09 MTs of raw material, valued at Rs. 2,12,12,788/-, would be required for fulfilment of the balance export obligation [726.05 MTs of final product]. They also recorded statements of Shri C.H. Jawahar Babu, Chief Executive of the Company and Shri Y.S. Chowdhary, Chai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utilized other materials for the purpose of exports. It is accordingly alleged that they had contravened Condition No. (vi) of Notification No. 203/92 ibid. The appellant submits that the order of the Commissioner is the result of erroneous appreciation of the stock of goods available as on 11-6-1998 [date of stock verification by DRI officers] vis-a-vis exports made under the advance licence after the said date. The appellant points out that it was admitted by the Chief Executive as also the Chairman of the company in their statements that the imported goods had been sold in the market and were not available at the time of investigation by DRI officers. It is further pointed out that learned Commissioner did not give any finding on the question whether the finished goods found in the factory on the date of inspection by DRI had been manufactured by using the raw material imported under the advance licence. It is also submitted that the Commissioner did not conclude that the imported material had been actually used in the manufacture of the products exported by the respondents subsequent to DRI inspection. It is claimed that the available evidence would support the departments cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the circumstances, the customs authorities had no jurisdiction to demand duty or impose penalty in relation to the subject imports. In this connection, learned counsel relied on the following decisions : · Dolphin Drugs (P) Ltd. v. Commissioner of Customs, Mumbai - 2000 (115) E.L.T. 552 · Standard Industries Ltd. v. Commissioner of Customs, Trichy - 2001 (136) E.L.T. 124 · Commissioner of Customs, Hyderabad v. Chemnior Drugs Ltd. - 2003 (160) E.L.T. 649 (T) · Jay Engineering Works Ltd. v. Commissioner of Customs, Chennai - 2003 (162) E.L.T. 680 (T) · Titan Industries Ltd. v. Additional Commissioner of Customs, Chennai - 2003 (158) E.L.T. 437 (Mad.) · Raja Imports and Exports v. Collector of Customs, Bombay - 2000 (119) E.L.T. 346 (Tribunal) · Centwin v. Commissioner of Customs, Chennai - 2002 (149) E.L.T. 573 (Tribunal) = 2002 (48) RLT 843 (T - Che.) 5. Referring to the finding of non-fulfilment of Condition No. (vi) of the Notification, learned counsel submitted that no evidence had been adduced by the department to show that the raw materials imported by the respondents had not been used in the manufacture of final products or that the materials had be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods. These contentions were raised before the lower authority also. We find that, in terms of the remand order of the Tribunal, the Commissioner carefully examined the particulars of stock of finished goods and raw materials recorded in panchanama dated 11-6-98 and found that (a) 836.353 MTs of finished goods was available in stock for exportation under the VABAL towards discharge of the balance export obligation of 726.035 MTs [1000 MTs less 273.95 MTs already exported]; (b) a total quantity of 202.045 MTs of raw materials was also available in stock as on 11-6-1998 and the same was sufficient for manufacture of 90 MTs of finished goods for completing the remaining export obligation viz. 726.035 - 636.353 = 89.682. We find that this arithmetic has not been rebutted in the present appeal. Moreover, it was towards balance export obligation of 726.035 MTs of finished goods that the respondents showed that they exported a much larger quantity [2018.46 MTs of non-alloy steel bars and rods] under 44 Shipping Bills subsequent to the above date. The party also submitted the banker's certificate of exports and realization of foreign exchange and also JDGFT's certificate of fulfilment of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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