TMI Blog2019 (10) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... ption fine on the appellant hence we do not discuss this aspect any further as this issue of confiscation has become irrelevant. Penalties - HELD THAT:- However for the acts of omission and commission leading to misdeclaration of the goods for which they had become liable for confiscation under Section 111, Commissioner has imposed penalty under Section 112(a) and we uphold the same. Appeal dismissed - decided against appellant. - Customs Appeal No. 89376 of 2018 C/Cross 85055 of 2019 - FINAL ORDER NO. A/86792/2019 - Dated:- 10-10-2019 - Mr. S.K. Mohanty, Member (Judicial) and Mr. Sanjiv Srivastava, Member (Technical) Shri H.K. Hirani, Consultant, for the Appellant Shri A.P. Kothari, Authorised Representative for the Respondent ORDER This appeal and cross objections are directed against order in original No 121/2016/17/ CC/NS-I/JNCH dated 31.01.2017 of Commissioner Customs NS-I, JNCH, Nhava Sheva. By the impugned order Commissioner has held as follows: i. I order that goods totally valued at ₹ 8,41,44,815/- (Rupees Eight Crore Forty One Lakhs Forty Four Thousand Eight Hundred and Fifteen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Provisional 316405 07.04.11 Roasted Molybdenum Ore 60.58% 2,16,42,241 5,57,288 4432424 23.08.11 Roasted Molybdenum Ore 59.46% 1,75,94,626 4,53,062 3145027 07.04.11 Roasted Molybdenum Ore 62.43% 2,13,40,834 5,49,527 Final (RMS) 3156426 08.04.11 Roasted Molybdenum Ore 59.32% 2,23,05,668 5,74,371 4674399 18.09.11 Roasted Molybdenum Ore 59.65% 1,85,48,402 4,77,621 780187 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w of the decision of the Apex Court in case of Star Industries relied upon by the revenue, the goods could not have been held liable for confiscation; Denial of exemption in respect of the Bill of Entries filed prior to date of receipt of Presidential Assent for Finance Act, 2011 is completely unsustainable. It would only after the publication of the Finance Act,2011, that the amendments made in Tariff will become applicable as has been held by the Apex Court in case of Param Industries {2015 (321) ELT 192 (SC)] The imported goods are ores and not ore concentrate and hence the benefit of exemption claimed will be admissible to them. For the goods to be liable for confiscation under Section 111, mis-declaration is required to be proved and, if there is no case of mis-declaration, confiscation cannot be madeo Sony Impex [2007 (215) ELT A49(SC)]; Kapil International [2008 (228) ELT 139 (T)] Pdm Impex [2005 (191) ELT 1121 (T-Kol)] Acti Technologies [2005 (189) ELT 121 T-Mum)] Northern Plastics [1998 (101) ELT 549 (SC)] No interest can be demanded when demand itself is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 28AA is justified; For the act of mis-declaration Commissioner has imposed penalty under Section112(a) which is neither excessive nor unjustified looking into the quantum of duty sought to be evaded. 4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 The issue on merits has been settled by the Hon ble Apex Court in case of Star Industries [2015 (324) ELT 656 (SC)] holding as follows: 26 . Before we discuss these arguments and arrive at a particular conclusion, we would like to recapitulate the salient features of the case about which there is no dispute : (a) The assessee is seeking benefit of Notification No. 4/2006-C.E. and relies upon Sl. No. 4 thereof which totally exempts goods described therein from payment of excise duty. The goods which are otherwise excisable are, thus, exempted from payment of duty. Description of these goods in Sl. No. 4 is Ores . (b) The goods imported by the assessee fall in Chapter 26 of Central Excise Tariff Act. Particular Tariff Item is 2613 against which the description of goods gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te 4. Note 4 now categorically mentions that the process of converting ores into concentrates would amount to manufacture . Therefore, it cannot now be argued that roasting of ores and converting the same into concentrates would not be manufacture. For the same reason, the judgment in MMTC becomes inapplicable and reliance upon Kirk-Othmer s Encyclopedia becomes irrelevant. With the addition of Note 4, a legal friction is created treating the process of converting ores into concentrates as manufacture. Once this is treated as manufacture, all the consequences thereof, as intended for creating such a legal friction, would automatically follow. Following shall be the inevitable implications : (a) It is to be treated that Molybdenum Ore is different from concentrate. That is inherent in treating the process as manufacture inasmuch as manufacture results in a different commodity from the earlier one. Section 2(f) defines this term as under : manufacture includes any process, - (i) incidental or ancillary to the completion of a manufactured product; (ii) which is specified in relation to any goods in the Section or Chapter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construction of Note 2 and Note 4 would lead us to hold that in those cases when Note 4 applies and Ores becomes a different product, it ceases to be Ores. 31 . We, thus, are of the opinion that in the impugned judgment, the Tribunal has rightly arrived at the conclusion that by virtue of Note 4, concentrate has to be necessarily treated as different from ores which is deemed as manufactured product after Molybdenum Ores underwent the process of roasting. Once we keep in mind that conversion of ores into concentrate is considered as manufacture and, therefore, becomes liable for central excise levy, exemption Notification No. 4/2006-C.E. is to be interpreted in this light as the Legislature has intended to treat ores and concentrates as two distinct items and Notification No. 4/2006-C.E. exempts only ores , concentrates automatically falls outside the purview of said notification. It is rightly argued by the learned senior counsel for the Revenue that exemption notifications are to be construed strictly and even if there is some doubt, benefit thereof shall not ensure to the assessee but would be given to the Revenue. This principle of strict construction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, as he had to, that even on the decision relied upon by him, the fact that owing to the operation of economic forces it was not possible for the taxpayer to pass on the burden of the tax, did not alter the nature of the imposition and detract from its being a duty of Excise . For instance, the state of the market might be such that the duty imposed upon and collected from the producer or manufacture might not be capable of being passed on to buyers from him. Learned Counsel urged that this would not matter, as one had to have regard to the general tendency of the tax and the expectation of the taxing authority and to the possibility of its being passed on and not to the facts of any particular case which impeded the operation of natural economic forces. The impediment to the duty being passed on might be due not merely to private bargains between the parties or abnormal economic situations such as the market for a commodity being a buyers market. Such impediments may be brought about by the operation of other laws which Parliament might enact, such for instance, as control over prices. If in such a situation where the price which the producer might charge h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f payment of duty or interest. In our view show cause notice issued within one year from the date of filing of Bill of Entry, is definitely within the normal period of limitation and demand made therein cannot be held to be hit by limitation under Section 28 of the Customs Act, 1962. Rejecting arguments similar to those advanced by advanced the appellants in respect of erstwhile Section 28, Hon ble Apex Court has in case of Jain Shuddh Vanaspati [1996 (86) ELT 460 (SC)] held as follows: 5. It is patent that a show cause notice under the provisions of Section 28 for payment of Customs duties not levied or short-levied or erroneously refunded can be issued only subsequent to the clearance under Section 47 of the concerned goods. Further, Section 28 provides time limits for the issuance of the show cause notice thereunder commencing from the relevant date ; relevant date is defined by sub-section (3) of Section 28 for the purpose of Section 28 to be the date on which the order for clearance of the goods has been made in a case where duty has not been levied; which is to say that the date upon which the permissible period begins to run is the date of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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