9911796707
TMI Blog2019 (5) TMI 1034X X X X Extracts X X X X X X X X Extracts X X X X ..... as adjudicated vide Order-in-Original dated 28.11.1997. On appeal, CESTAT vide its order dated 16.07.2003 remanded the matter back to the original authority which was decided by him vide the impugned denovo adjudication order. 3. Heard both sides and perused the records. 4. The appellant herein is a company engaged in manufacture and marketing of motor vehicles, having its factories at Kandivali and Nasik. In addition, they also took over another company originally set up by Allwyn Nissan Ltd at Zahirabad. This company was taken over by the appellant in 1994 and the period of dispute is between 1990 and 1994. The appellant herein is now dealing with the matter as the successor of the original company which they bought. The issue which f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from manufacturing division by the spare parts division and returned in the form of another spare part of the same type. The department issued a show cause notice dated 20.06.1995 seeking to deny the benefit of the exemption notification and demanded the differential duty of Rs. 1,71,33,655/-. It was also proposed to impose a penalty upon the appellant. In the impugned order, the demand is confirmed and penalty imposed. 6. The appeal of the appellant is under following grounds: (1) During the relevant period the previous firm viz., M/s Allwyn Nissan Ltd which they took over were importers and manufacturers and therefore no duty can be charged or malafide can be alleged against them being only the successor firm. (2) There was an un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence whatsoever in the records of the case to show that they have charged any amount as representing customs duty from their customers. Therefore, demand on this ground needs to be set aside. (5) He would further argue that the exercise is revenue neutral and therefore, extended period of limitation should not be invoked. 7. Learned departmental representative reiterates the findings of the impugned order and submits that demands were correctly confirmed along with the interest and penalties were correctly imposed. 8. We have considered the arguments on both sides and perused the records. The crux of the issue is whether the concessional rate of duty available for parts imported as OE parts by the appellant will also be availabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... em for some other use. Clearly, such diversions are not covered by the exemption notification. There is no scope for such diversion or even of loaning of the goods for some other purpose with the understanding that a corresponding quantity of the goods will be returned after some time. Therefore, as far as the exemption notification is concerned, they are NOT entitled to the benefit of exemption notification on such quantity of the goods as were diverted from OE to their spare parts division. The appellant's contention that they were not the manufacturers during the relevant period who had imported the goods but had taken over the firm subsequently also does not carry their case any further. Once they have taken over the unit from the previ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this count. In the impugned order a penalty of Rs. 40 lakhs has been imposed under Sec.112 (a) & (b) of the Customs Act upon the appellant for noncompliance of the conditions of the customs notification and clandestine clearance of OE parts to their spare parts division as discussed above. A penalty of Rs. 75,000/- was also imposed on the following individuals who worked with the appellant Shri V. Vaidyanathan - Rs. 75,000/-, Shri C.S. Ramakrishnan - Rs. 75,000/- and Shri S. Upadhya - Rs. 75,000/-. We find that considering that these executives were working for and on behalf of the appellant, there is a case to set aside personal penalty on them. We also find a case to reduce the penalty imposed on the appellant under Sec.112 (a) & (b) fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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