TMI Blog2008 (8) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... nd P. Karthikeyan, Member (T) S/Shri N. Venkatraman and M.N. Bharathi Advocates, for the Appellant. Shri M.K.A.K. Mohiddin, JDR, for the Respondent. [Order per: P.G. Chacko, Member (J)]. - M/s. APP Enterprises had imported "Betelnut" under job work contracts with foreign suppliers for the purpose of undertaking the job of manufacture of 'Tannin' for export to the raw material-suppliers. The imported raw material was cleared duty-free in terms of Notification No. 32/97-Cus. dated 1-4-97. Condition No. (v) for the benefit of exemption under the Notification was that the jobbing should be undertaken in terms of the procedure set out in the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n recover able from the imported raw material had been exported and, therefore, it could not be alleged that any part of the imported raw material was diverted to the market. In adjudication of the dispute, the Commissioner confirmed the demand of duty against M/s. APP Enterprises on the ground alleged in the SCN, and imposed on them a penalty of Rs. 5 lakhs, besides a fine of Rs. 10 lakhs imposed in lieu of confiscation of betelnut. Penalties of Rs. 3 lakhs each were imposed on two partners of the firm. No penalty, however, was imposed on M/s. Mathan Traexim Ltd., the biggest partner in the above firm. Appeal No. C/150/08 of the partnership firm and appeal Nos. C/151/08 C/152/08 of its two partners (penalized by the Commissioner) are aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad executed a bond to his satisfaction in respect of end-use of the imported goods. On the basis of such certification by the Asst. Commissioner of Central Excise having jurisdiction over the factory, the Asst. Commissioner of Customs at the port of importation allowed the benefit of the Notification to M/s. APP Enterprises in terms of sub-rule (1) of Rule 5. The Asst. Commissioner of Customs forwarded copies of the Bills of Entry containing the particulars of import to the Asst. Commissioner of Central Excise having jurisdiction over the factory in terms of sub-rule (2) of Rule 5. Under Rule 6, the Asst. Commissioner of Central Excise acknowledged the receipt of the Bills of entry from the Asst. Commissioner of Customs. The requirement of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record, we find that export of Tannin extracted to the extent of approx. 20% by weight of the imported betelnut is a fact pleaded by the assessee in their reply to the SCN and not rebutted in the Commissioner's order. According to a study by the Food and Agriculture Organisation (FAO) of the United Nations, discussed in the Commissioner's order, Tannin content of ripe nut is in the range 11.1 to 17.8%. The assessee manufactured approx. 20% of Tannin as claimed in their reply to the SCN. The only basis for the impugned demand of duty is the alleged diversion of raw material without being put to the intended use. As rightly contended by the assessee, where they had generated 20% Tannin (a little more than the maximum found in the FAQ's st ..... X X X X Extracts X X X X X X X X Extracts X X X X
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