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2017 (5) TMI 938 - CESTAT NEW DELHI

2017 (5) TMI 938 - CESTAT NEW DELHI - TMI - 100% EOU - import of second hand machinery for installation and use at Nagpur unit - benefit of N/N. 53/97 dated 3.6.97 - Subsequently, the appellant obtained permission from the Assistant Commissioner, Nagpur to transfer the machinery to their Raipur unit - denial of benefit of notification on the ground that the goods were not installed by the appellant and is transferred to another unit - the claim of appellant is that the goods were not cleared for .....

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unused - benefit denied - appeal dismissed - decided against appellant. - Customs Appeal No. 51531, 51801 & 51863 of 2014 - Final Order No. 53337-53339 /2017 - Dated:- 18-5-2017 - Mr S K Mohanty, Member (Judicial) And Mr. V Padmanabhan, Member (Technical) Shri A. Hidayatullah, Sr. Advocate with Shri Rupesh Kumar, Advocate for the Appellants Shri S. J. Singh, (Special Counsel) DR for the Respondent ORDER Per V Padmanabhan The appeals have been filed against order No. 114 /2013 dated 25.11.2013 p .....

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. The appellant imported second hand machinery and claimed exemption from Customs duty under Customs Notification No. 53/97 dated 3.6.97 for installation and use at Nagpur unit. The goods were cleared by filing two Bills of Entry and warehoused at Nagpur unit on 27.11.97. Subsequently, the appellant obtained permission from the Assistant Commissioner, Nagpur to transfer the machinery to their Raipur unit. After obtaining the said permission, the goods were shifted to Raipur and rewarehoused at t .....

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machinery which were found uninstalled and unusable. The show cause notice was decided in the original proceedings by the Commissioner vide his order in original dated 9.2.07 in which the customs duty demand was confirmed along with imposition of various penalties under the Customs Act. The appellant challenged this order before the Tribunal, who vide the Final Order No. C-227-229/11 dated 19.5.11 set aside the order and remanded the matter for denovo decision to the Commissioner with the follow .....

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the adjudicating authority, which is absent in this case. 8. In view of the above, we are of the considered view that the impugned order is incorrect, need to be set aside and the matter needs to be reconsidered by the adjudicating authority. Without expressing any opinion on the merits of the case and keeping all the issues open, we set aside the impugned orders and remand the matter back to the adjudicating authority to reconsider the issue afresh following the principles of natural justice. .....

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h, Senior Advocate along with Shri Rupesh Kumar, Advocate on behalf of the appellants. Revenue was represented by Special Counsel Shri S J Singh. 6. The learned Senior Counsel argues the case of the appellants and the important points are summarized below: 1. The present proceedings emanate from the order-in-original No. Commissioner /RPR/CEX/14/2013 dated 25.11.2013 passed by the learned Commissioner, Raipur. 2. It is submitted that the appellant has been able to consistently meet its export ob .....

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of Notification No. 53/97-Cus which states that the imported goods shall be installed in bonded area within a period of one year from its importation. During the relevant period i.e. on the date when the subject machineries were imported in the year 1997, there was no condition of prescribing any specific period for installation of imported capital goods. 5. The restriction was inserted only on 19.5.1999 by way of notification No. 65/97-Cus dated 19.5.1999 amending the Notification No. 53/97-Cus .....

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y in bond, and thus, any demand of duty on imported capital goods which are in Customs bond can arise only when the said goods are ex-bonded and not prior to that. 8. The reliance upon para 9.1 of Chapter 25 of CBEC Customs Manual to come to the conclusion that, the relevant period for determining the application of the prevailing provisions of Notification No. 53/97-Cus would be date of removal of imported capital goods from one warehouse to another, is misplaced. There is no mention of removal .....

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e Central Excise Rules, 1944, a deeming provision under the law existed which stated that if registration certificate was not granted within a period of 30 days of making an application in that regard, registration applied for, was deemed to have been granted and thus, in the present case, since no response was received, the appellant was under bona fide belief that, central excise registration had been granted to it. 7. Arguing the case for the Revenue, the learned Special Counsel putforth the .....

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rnatively from a public warehouse or a private warehouse, in addition to import. The condition of installation of capital goods within one year was made applicable both for goods which are imported duty free as well as procured duty free as above. The case of the appellant was under the category of procurement from private bonded ware house, inasmuch as the second hand capital goods were procured from the appellant‟s Nagpur unit. Since the appellants has failed to complete installation of .....

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ere not used for manufacture of goods for export and consequently even in terms of unamended provisions of notification, the customs authorities were within their right to demand the duty. 8. Both sides relied upon various case laws to support their arguments. 9. To consider the rival claims and to decide the duty demands, we consider it necessary to reproduce the relevant paragraphs of notification No. 53/97 before amendment as well as after the amendment vide notification No. 65/99 dated 19.5. .....

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been used in the manufacture of articles or in connection with the production or packaging or job work for export of goods or services out of India. In the said notification Amendment by Notification No. 65/99-Cus dated 19.5.99 (vide para 8) :- (a) In the opening paragraph, for the words when imported into India, for the purpose of manufacture of articles for export out of India , the words when imported into India or procured from a Public warehouse or a private warehouse appointed or licensed .....

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said goods till the date of payment of such duty, if - (i) In the case of capital goods, such goods are not proved to the satisfaction of the Assistant Commissioner of Customs to have been found installed or otherwise used within the bonded premises or re-exported within a period of one year from the date of importation or procurement thereof or within such extended period not exceeding five years as the Assistant Commissioner of Customs may, on being satisfied that there is sufficient cause for .....

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sent case, the capital goods when imported in 1997 were warehoused in the Nagpur unit. Subsequently, the appellants procured the goods without payment of duty for use in their Raipur unit. The application for such rewarehousing has been made to the relevant Central Excise and DGFT authorities and the goods have been rewarehoused in Raipur unit on 17.4.2000. It is pertinent to note that procurement and rewarehousing has been done after the date of amendment of the relevant Foreign Trade Policy as .....

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even after a period of 5 years. The goods procured by the appellants on 17.4.2000 should have been installed by 17.4.2001 but were not found installed even in March, 2005. From the above facts, it is clearly established that the appellant has failed to satisfy the impugned conditions of notification No. 53/97. Since the procurement of goods has been done after the amendment of notification and as per the amended terms of the notification, it is incumbent on the part of the appellant to also sati .....

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ons prevalent in notification No. 53/1997 at the time of import only will be applicable to the appellant and not the conditions after the amendment. It has been argued that since there was no condition regarding the installation at the time of import, same cannot be made applicable to the appellants. It has further been argued that there can be no demand for Customs duty in case of removal of goods from one warehouse to another since the goods remained warehoused and Customs duty is payable only .....

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hanges in Export Import Policy. Once the goods have been procured in Raipur unit in terms of amended terms of EXIM Policy as well as Customs Notification, it is also imperative on the part of the appellant to satisfy the other conditions imposed on them. Consequently, we reject the argument that the amended condition in the notification will not be applicable to these goods since the same have been imported prior to amendment. 13. The goods in the present case have no doubt been removed from one .....

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