TMI Blog2021 (7) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... licence, it is also seen that licence holder may discharge the export obligation by way of direct exports as well as through third party exports. In the event of third party exports, name of the third party exporter, name of the EPCG licence holder, licence number and date should be noted on the shipping bill. Thus, it cannot be said that merely by exporting the goods through third party exporter/Rithvikk Garments, the licence holder (Sri Angallamman Knit Fabrics) has violated the conditions of the EPCG licence. Over and above all the facts, it has to be noted that since there is enough time for completion of export obligation and also for submitting necessary documents before the DGFT, the show cause notices issued by the department allegi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ital goods imported under EPCG Licence No.3230021861 dated 18.02.2015. Appellant viz. M/s.Rithvikk Garments as third party exporter, filed Shipping Bill dated 03.12.2019 in Custom House, Tuticorin for export of 28908 sets of Knitted Girls Pyjama after endorsing the EPCG license as above pertaining to M/s.Sri Angallamman Knit Fabrics. Noticing certain discrepancies, they were asked by the officers to produce the invoice raised for the goods exported by EPCG licence. The appellants produced one invoice No.470 dated 11.10.2019 raised by M/s. Sri Angallamman Knit Fabrics showing an amount of ₹ 1,82,120/-. The value of the goods declared in the shipping bill was ₹ 51,71,747/-. On the apprehension that the EPCG license is misused, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 18.02.2015 by DGFT. As per this licence, they have to fulfill the obligation of export of goods manufactured using the capital goods imported by them. The said licence / notification also allows export through a third party exporter. M/s. Sri Angallamman Knit Fabrics and M/s.Rithvikk Garments had entered into an agreement dated 26.08.2019 wherein it was mutually agreed for giving effect to the EPCG licence conditions and for execution of export orders of garments under job work manufacture. One of the allegations raised by the department is that the appellant has not fulfilled export obligation in respect of the EPCG licence. Ld. Consultant adverted to the EPCG licence and submitted that the period of validity of the said licence is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only ₹ 1,82,120/- was only shown in invoice No.470 dt. 11.10.2019. The appellant M/s.Rithvikk Garments purchased cotton yarn which was given to M/s. Sri Angallamman Knit Fabrics who manufactured knitted fabrics using the imported capital goods. Thus, Sri Angallamman Knit Fabrics acted as a job worker for M/s.Rithvikk Garments. The knitted fabrics were sent to Rithvikk Garments who, after job works like dying, compacting, ironing etc., manufactured garments in their factory. These garments were exported as per the export order by shipping bill filed by M/s.Rithvikk Garments. Since job work-manufacture was done by Sri Angallamman Knit Fabrics (licence holder) using imported capital goods, the details of licence was endorsed on the ship ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellants have not fulfilled export obligation is sustainable or not. On perusal of EPCG licence it is seen that it is issued in 2015 by DGFT and the period for completion of the export obligation is six years. Show cause notice has been issued on 18.11.2020. The contention of the appellant that SCN alleging non-fulfilment of export obligation is premature is therefore not without merits. 7. The second allegation is with regard to overvaluation of the export goods in the shipping bills. During the investigations, statements were recorded from the appellants. Statement of Shri R. Karthikeyan, Proprietor of M/s.Rithvikk Garments recorded on 9.12.2019 is reproduced as below : 16. Shri R.Karthikeyan, Proprietor of M/s.Rithvikk Gar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for job work charges and not for supply of finished goods. The appellant has produced various challlans as proof of supply of yarn by Rithvikk Garments to Sri Angallamman Knit Fabrics. So also there are several invoices produced to show that M/s.Sri Angallamman Knit Fabrics was job work-manufacturer and was using the imported goods for manufacture of knitted fabrics which was later made into knitted garments by Rithvikk Garments. From the conditions of the EPCG licence, it is also seen that licence holder may discharge the export obligation by way of direct exports as well as through third party exports. In the event of third party exports, name of the third party exporter, name of the EPCG licence holder, licence number and date should b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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