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2016 (12) TMI 1511 - CESTAT AHMEDABAD

2016 (12) TMI 1511 - CESTAT AHMEDABAD - TMI - Attachment of property - factory premises was leased to M/s Siddhnath Exports, an 100% EOU, for the period from 27.03.2000 to 26.03.2006. Since M/s Siddhnath Exports defaulted in payment of confirmed excise duty and penalty amounting to ₹ 4,59,00,617/-, the recovery proceeding of the said amount was initiated from the Appellants - the recovery notice was issued to the Appellant on 11.10.2005 along with M/s Siddhnath Exports for recovery of the .....

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premises before completion of export obligations and expiry of lease period of six years. - Held that: - I find that on the very same issue, the Tribunal has discussed in detail, the legality of the recovery of the outstanding dues from the lessor when the lessee, an 100% EOU, vacated the premises before fulfillment of the export obligations in Rajabali Ismail Rajbara case[2014 (3) TMI 483 - CESTAT AHMEDABAD (LB)] and by majority held that recovery cannot be made from the Lessor by attachmen .....

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ant had leased their factory premises to one M/s Siddhnath Exports, an 100% EOU, for the period from 27.03.2000 to 26.03.2006. Since M/s Siddhnath Exports defaulted in payment of confirmed excise duty and penalty amounting to ₹ 4,59,00,617/-, the recovery proceeding of the said amount was initiated from the Appellants initially by attaching the said property on 29.11.2004 but later with direction of Hon ble Gujrat High a Notice was issued to them 11.10.2005, which on adjudication was confi .....

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f the said premises. He submits that even though the lease period was for six years, the lessee M/s Siddhnath Exports has vacated the premises in the year 2001. The learned Commissioner(Appeals), interpreting the sub-clause (ii) of clause (c) of Sub-section (1) of Section 142 of Customs Act,1962 erroneously observed that the said property was under the control of defaulter M/s Siddhnath Exports and consequently held that for recovery of the dues outstanding from the said M/s Siddhnath Exports, c .....

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ses even after vacation of the said leased premise albeit before expiry of the lease period. The learned Advocate submitted that in similar facts and circumstances, this Tribunal by majority, in the case of Rajabali Ismail Rajbara Vs CCE Surat - 2013 (298) ELT 612 (Tri-Ahmd), observed that recovery of confirmed dues pending against the lessee - EOU cannot be recovered from the lessor even though the lessee EOU had vacated the premises before expiry of the lease period. It is his contention that .....

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ntention that in the present case, lease deed dt.27.03.1999 has been registered and also recovery notice was issued to the appellant on 01.07.2004 i.e. before expiry of the lease period 6. I find that the recovery notice was issued to the Appellant on 11.10.2005 along with M/s Siddhnath Exports for recovery of the outstanding dues under Section 142(1)(c)(ii) of Customs Act, 1962. It is not in dispute that under registered lease deed executed on 27.03.1999, the Appellants had leased their factory .....

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