New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (8) TMI 479 - CESTAT ALLAHABAD

2016 (8) TMI 479 - CESTAT ALLAHABAD - TMI - Export incentive drawback section 75 of the Customs Act all industry rate-2% of F.O.B. enquiry - quantum of frozen meat exported Slaughtering upto 500 buffaloes a day approved from APEDA Held that: - As per the registration certificate of APEDA, the slaughter permission approved was 500 animals or buffaloes per day whereas as per the processing capacity (170 MT per day of boneless buffalo frozen meat), the appellant could have utilized th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

based on presumption that the appellant could not have processed more than 500 buffaloes per day in view of the Certificate of APEDA. There is no dispute that the slaughtering capacity has to be, prima-facie, approved by the State Pollution Control Board. - section 50(2) of the Customs Act 1962 contravention inadmissible drawback Held that: - there is no dispute of export of packing material along with the frozen meat. In this view of the matter, there is no irregularities in the drawb .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

307/2016 - Dated:- 14-6-2016 - Mr. Anil Choudhary Member (Judicial) and Mr. Anil G. Shakkarwar Member (Technical) Shri B. K, Singh & Garvit Chauhan, both advocates for the Appellant(s) Shri D. S. Mann, Asstt. Commr. (D.R.) for the Department ORDER The issue in this appeal is that whether the appellant-exporter, have availed inadmissible export incentives by way of claiming draw-back on the quantities of 17625.465 MT of frozen meat to the extent of ₹ 4,94,01,708/-. 2. The brief facts ar .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

The appellant exports 100% of the products and is entitled to the duty drawback in terms of Section 75 of the Customs Act read with the Customs, Central Excise Duties and Service Tax Drawback Rules 1995 and further vide circular No,42/2011 - Cus read with standard input output norms of export of products in respect of frozen meat packed and in packing of LDPE/HDPE/PB granules, Kraft paper and cardboard other than laminated board, all industries rate have been prescribed for drawback and the rat .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

5 of Foreign Trade (D&R) Act, 1992 and such exports are prohibited under Section 11 of Foreign Trade (D&R) Act, 1992; (b) The appellant/exporter have slaughtered more than 500 animals per day as against the approval from APEDA only for maximum 500 animals Per day ; (c) The appellant/exporter have exported total quantity of 34080 MT of Frozen Buffalo Boneless meat during the period from 15.06.2012 to 31.03.2013 out of which, they could legitimately manufacture and export 16455.368 MT and .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

with intent to avail inadmissible drawback. (e) That the appellant/exporter availed inadmissible export incentives by way of claiming drawback on the said quantity of 17625.465 MT to the extent of ₹ 4,94.01.708/- which is recoverable from them under the provisions of Rule 16 of Customs Excise Duties and Service Tax Drawbacks Rules, 1995 along with interest under Section 75A(2) of the Act. 3.1 The appellant contested the show cause notice stating that the Indian Meat Exports are regulated a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ltural and Processed Food Products Export Development authority(APEDA). Inspection of the meat processing plants is carried out by a Committee of experts as per the standards laid down in the Meat and Meat Products order (1973) &Food Safety and Standards Authority of India (FSSAI), Government of India. During inspection, focus is on hygiene and sanitary conditions maintained by the plant, ante-mortem and post-mortem inspections of each animal, infrastructure, staff hygiene, laboratory facili .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

icate also states that meat has been obtained from healthy, disease free livestock, which are free from contagious and infectious disease, including foot and mouth disease and other diseases. The Health Certificate also confirms that the livestock have been subjected to ante-mortem inspection followed by post-mortem examination and that the meat is fit for human consumption, besides having the services of highly qualified and experienced veterinarians, microbiologists etc. Employed by the export .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

o 82(RE-2010)/2009-2014, New Delhi, dated 31st October, 2011 are: (i) All the amendments/changes made in August, 2009 and September, 2011 have been notification to make it comprehensive. Delhi, dated 31st Chapter 2 between incorporated in this Notification to make it comprehensive. (ii) Exporters would now be required to certify both (a) That the items have been obtained/sourced from an APEDA registered integrated abattoir or from APEDA registered meat processing plant and (b) That the raw mater .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

owever, on the representation of the Meat exporter's trade a further Notification No 82 (RE-2010)/2009-2014 dated 15th December,2011 was issued to bring into effect the above provision of Note-6 of Notification No. 82 after six Months from today i.e. from 15th June, 2012, Rest of the notification No 82 (RE-2010)/2009-2014 dated 31.10.2011 date of issue i.e. 31.10.2011. 3.4 For the export purposes, frozen Boneless meat of Buffalo (both male and female) are classifiable at Sl.No.19 (b) under T .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ertificate about quality control and inspection under Note 3 as well as fulfilment of conditions stipulated at Note 8. (III) Furnishing a declaration by the exporter for fulfilment of Condition stipulated at Note 6 that meat and/or raw material are sourced/obtained from an APEDA registered integrated abattoir or from APEDA registered meat processing plant. 3.5 The inferences drawn by the DRI are as under: (i)That the appellant had procured the excess buffalo from other Sources (not APEDA approve .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

duction capacity: (iv)The appellant thus availed inadmissible export incentive in the form of Drawback which was recoverable under Rule 16 of the Drawback rules. (v)The appellant wrongly declared in the Shipping Bill filed under Section 50(2) of the Customs Act. 4. The SCN was adjudicated ordering confiscation of 17625.465 MT buffalo meat valued at ₹ 290,59,15,220/- under Section 113 (d) of Customs Act, 1962 with option to redeem by paying fine of ₹ 50,00,000/-. Further amount of dra .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

lowing grounds : 5.1 First of all, it is urged that Drawback is not an incentive. As per Rule 2(a) of the Drawback Rules In these rules, unless the context otherwise requires,- (a)"drawback" in relation to any goods manufactured in India and exported, means the rebate of duty or tax, as the case may be, chargeable on any imported materials or excisable materials used or taxable services used as input services in the manufacture of such goods; Thus the Drawback is rebate in lieu of duty .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

have been entered for export; (ii) in respect of such goods, an order permitting the clearance and loading thereof for exportation has been made under section 51 by the proper officer; (iii) The government should notify the eligibility of such goods for drawback on some Products: (iv)The government should not have specifically disallowed drawback on some Products; (v) export value of such goods or class of goods should not be less than the imported materials used in the [manufacture or processi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the condition of Section 75 of the Act is sine qua non for applying Rule 16 of the Drawback Rule for recovery of drawback already paid to the appellant. As may be seen, Rule 16/16A of the Drawback Rule provides certain reasons for recovery of drawback. These are (i) Where an amount of drawback and interest, if any, has been paid erroneously; (ii)where the amount so paid is in excess of what the claimant is entitled to, (iii) Where an amount of drawback has been paid to an exporter or a perso .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s that the appellant had permission to slaughter only 500 animals per day and they have slaughtered more. Yet another presumption made in the SCN is that since the appellant did not have capacity to slaughter more than 500 buffaloes, they would have procured the Meat from a Source not approved by the APEDA. 5.5 (i) At the cost of repetition, it is submitted that the DRI has itself agreed that the appellant had slaughtered more than 500 buffaloes in their abattoir. The appellant had agreed to thi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r manufacture a commodity is measured by the capacity to produce the final product and not the capacity to consume the raw material. For the appellant, the number of buffalo is raw material. It is Buffalo Meat which is the final product and violation of the provision relating to the capacity is to be assessed by that of final product and not of raw material which was number of buffaloes. 5.5 (ii) The allegation of the DRI is that as the appellant had capacity to slaughter only 500 buffaloes per .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

arding transportation for or sale of buffalo meat to the Notice from any other place nor corroborated with evidence of payments, if any, made to the suppliers of such alleged Meat. Thus the allegation of the DRI in the SCN is without any tangible evidence. 5.5 (iii) on the contrary, the evidences on record are all in favor of the appellant. The appellant had all certificates at the time of export in terms of conditions mentioned in Para 5 (supra) of this submission which showed that the buffaloe .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bjection was raised at the time of export by any agency who had allowed export of the goods 5.5 (iv) So far the number of buffaloes to be slaughtered mentioned in the Certificate is concerned, it is submitted that appellant had applied to Uttar Pradesh Pollution Control Board (here-in-after refer to as UPPCB), Lucknow for amendment in the number of buffaloes to be slaughtered per day from 500 to 1000 per day vide their application No. AHAF/2011/94 dated 26.09.2011/03.10.2011. The Regional Office .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

llution) Act, 1974 and similar provision under Sub-Section (4) of Section 21 of the Air (Prevention and Control of Pollution) Act, 1981, the NOC/Consent, unless refused, be deemed to have been given unconditionally on the expiry of a period of 4 months from the date of filing/forwarding of the application. Since, the notice never received any adverse report or refusal from UPPCB, Lucknow with respect to their application, they considered the same to have been granted as per the deeming provision .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s as to in which Shipping Bills the declaration was wrong. It is submitted that all Shipping Bills were accompanied by proper certificates of the APEDA as well as of the Veterinary Doctors of State Government and the declaration was filed as per the certificates. The Revenue has not challenged or doubted the contents of the Certificates. They have also not recorded the statements of any of the authorities who had issued the certificates regarding number of animals being slaughtered and processed .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

le to confiscation. This itself shows the inadequacy evidence with the Revenue for mis-declaration. Hence, the charge of mis-declaration is frivolous and not sustainable. 5.7 It is alleged in the SCN that the appellant has violated Section 11 of the FTDR Act, 1992 and therefore the exported goods are prohibited and liable to confiscation under Section 113 (d) of the Act (Section 11 of the FTDR Act, 1992 has been quoted earlier). According to sub-section (1) of Section 11 of FTDR Act, 1992 " .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

carried out by a Committee of experts as per the standards laid down in the Meat and Meat Products Order (1973) & Food Safety and Standards Authority of India (FSSAI), Government India. During inspection, focus is on hygiene and sanitary conditions maintained by the plant, ante-mortem and post-mortem inspections of each animal, infrastructure, staff hygiene, laboratory facilities, record maintenance etc. The registration of the meat processing plants is renewed every year after a detailed p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d infectious diseases, including foot and mouth disease and other diseases. The Health Certificate also confirms that the livestock have been subjected to ante-mortem inspection followed by post-mortem examination and that the meat is fit for human consumption, besides having the services of highly qualified and experienced veterinarians, microbiologists etc., employed by the exporting units. 5.9 The very nature of the certificate warrants that the animals are examined before slaughtering and af .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s presumption, the Revenue has not produced any evidence such as the person from whom Meat was sourced, the place from where it was sourced, payment made to the supplier, transport used, etc., regarding so called other source of procurement. It is not disputed that such Health Certificates had been issued for each consignment after inspection and testing of each animal/buffalo before and after slaughtering AND after testing of processed meat in the in-house laboratory of the appellant within int .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

each Shipping Bill/Consignment stating that:- (a) the items exported have been obtained/sourced from an APEDA registered integrated abattoir or from APEDA registered meat processing plant; and (b) the raw material, means Carcasses, have been sourced exclusively from APEDA registered integrated abattoir/abattoir. A careful look at the wordings used in the said conditions indicate that the conditions mentioned at (a) above, part of Note 6 to Chapter 2 of Schedule 2 to ITC(HS) is for merchant expo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

C(HS) and is relevant and related to those manufacturers who have only meat Processing Plant but do not have their own slaughter house which is not the case with the appellant as they have their own integrated Abattoir-Cum-Meat Processing Plant. They had not obtained/sourced any raw material from any other plant either approved and registered with APEDA or not approved or registered with APEDA. This allegation was denied and was not accepted by the exporter, in their statements under Section 108 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rted. They conveniently ignored that the appellant had approved capacity to manufacture the quantity of 170MT of boneless frozen Meat. The said capacity in terms of weight was much more than the quantity exported by the appellant. 5.14 There is no provision to declare under Section 50 or 75 of the Act or under chapter Note 3, 6 & 8 to Chapter 2 of Schedule 2 of ITC(HS) Classification of Export and Import Items or under Rule 16 of the Drawback Rules, 1995 by the exporter about the number of B .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t is the reason they continued slaughtering more than 500 animals per day. In his statement dated 04.05.2014 Shri Baqar Abid categorically stated that they do not purchase any meat from outside and whatever they pack for export is slaughtered in their own slaughter house. It is alleged in Para 14 of the SCN that the appellant had exported a quantity of 17625.465 MT of Frozen Boneless Buffalo Meat in excess of the maximum production capacity which also includes the quantity of 2532 MT produced fr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

g of animals/buffaloes, even if more than 500 animals per day, has taken place in their Abattoir-cum-Meat Processing Plant which stand confirmed from the certificates issued by designated authority of State Government for each buffalo slaughtered in their Plant by testing and inspection of buffaloes in their plant only, Therefore, the allegation that they had purchased and sourced meat/carcasses from non APEDA approved sources is not correct and not sustainable. 5.15 In view of admitted facts, a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

(d) of the Act or under Section 11 of the Foreign Trade (D&R) Act, 1992 as alleged in the show cause notice. It is re-iterated that impugned goods were neither Prohibited nor restricted nor STE and were Free to be exported and accordingly, the appellant did not contravene any provisions of APEDA, or Chapter 2 of Schedule 2 or Section 50 or 113 (d) of the Act or Section 11 of Foreign Trade (D&R) Act, 1992 and thus, the allegations made under Para 16, 18 and 19 of the Show Cause Notice are .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s subject to which the goods are permitted to be imported or exported have been complied with". In view of the above submission, the export of goods by appellant was FREE subject to fulfilment of conditions stipulated in Column 6 of Chapter 2 of Schedule 2 to ITC(HS). These conditions have been admittedly fulfilled as explained and verified by Customs Department in each and every consignment before Let Export order was given. Moreover, all consignments have been examined, stuffed in refrige .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ny Act, Rule, Regulation or .94 Notification issued under any Act which make the goods as prohibited goods. 5.17 Further, in absence of goods being available, the order of confiscation is bad ad fit to be set aside as held by Hon'ble Calcutta High Court in the following case:- Anita International v/s Commissioner of Customs, Calcutta; 1993 (65) ELT 201(CaI). 5.18 Further, the appellants have filed monthly returns with APEDA (the regulatory body) giving details of quantity produced and export .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

roduced from un-authorized slaughtering or the excess quantity was procured from non-APEDA sources and exported by the appellant. The Id. Commissioner observed that the appellant might have submitted the APEDA Certificate but the same was invalid for slaughtering of more than 500 animals per day whereas the appellant exported more quantity. Thus, the APEDA Registration Certificate was not valid for such excess quantity exported. This fact was not brought to the notice of the Customs Officer at t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

, they had applied to the UPPCB for the consent/NOC for increasing the slaughtering capacity to 1000 animals per day, as it was a precondition for registration with APEDA. The authority of UPPCB had inspected the unit of the appellant and forwarded the report on 02/02/2011 and in pursuance thereto, the compliance as suggested had been made by the appellant and intimation for the same had been given to the UPPCB. Further, the contention of the appellant that under the provisions of the deemed con .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ng day. There is no stipulation that the maximum quantity sanctioned for a particular day, should be disposed of or cleared on that day only. The different capacities like freezing capacity, chilling capacity, was sanctioned on the basis of chilling facility available, therefore the appellant cannot seek immunity on the ground that they had more sanctioned export capacity and hence, they could have slaughtered more animals per day. 6.2 The plea of the appellant is completely untenable that they .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed would be 18987 MT, which includes the quantity of 2532 MT produced from 18257 animals slaughtered in excess of the permitted capacity during the period November, 2012 to February, 2013. Therefore, the legitimate quantity available for export during this period would be 16455 MT (18987-2532 MT). As per shipping bill-wise details for the period 15.06.2012 to 31.03.2013, appellant had exported 34080.883 MT of boneless buffalo meat whereas legitimate quantity available for export is calculated at .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

as in several weightmant slips maximum weight appeared to be 318 kgs. Thus, definitely the balance quantity of 15093 MT was produced in a non-APEDA sanctioned abattoir whether it was outside or inside their plant. But in any case, they were not authorized to produce more than 16455 MT of meat during the aforesaid period. Therefore, it is evident that the quantity of 17625.465 MT of frozen meat was exported in excess of the quantity sanctioned by APEDA from the plant of appellant. Thus, the decla .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he form of duty drawback, as claimed by the appellant was recoverable. Accordingly, he prays for dismissing the appeal and confirming the impugned order. 7. Having considered the rival contentions, we find that it is not disputed as to the quantum of frozen meat exported by the appellant. It is also not disputed that the frozen meat was processed and exported from the APEDA approved unit of the appellant. In all the consignments of export, the same were factory stuffed under supervision and seal .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

value and the country to which exports were made. It is also an admitted fact that as per the registration certificate of APEDA, the slaughter permission approved was 500 animals or buffaloes per day whereas as per the processing capacity (170 MT per day of boneless buffalo frozen meat), the appellant could have utilized the meat of more than 500 buffaloes in view of its installed capacity. The appellants have also led evidences, being Annexure 22 to the appeal memo, wherein they applied to the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

onditions by the Pollution Control Board and the same was duly complied with under proper intimation dated 9/1/2012, categorically mentioning that the appellant will commence trial runs and if there are any further instructions, the same may be intimated in the meantime.. The Id. Counsel for the appellant, has further demonstrated that under The Water (Prevention and Control of Pollution) Act, 1974, section 7 provides that "the consent referred to in sub-section (1) of Section 25 shall unle .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version