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TMI Blog2023 (5) TMI 431X X X X Extracts X X X X X X X X Extracts X X X X ..... he Central Excise Act, 1944 and order recovery of the said amount from M/s GPIL. ii) I confirm and order recovery of interest from M/s GPIL under the provisions of Section 11AB of Central Excise Act, 1944; iii) l impose a penalty of Rs. 1,00,000/-(Rs. One Lakh) on M/s GPIL, under Rule 25 of the Central Excise Rules, 2002, for wrongly availing Notification No. 46/2001 CE(N.T.) dated 26.06.2001 and clearing the goods without payment of duty to M/s Nuance Group India Pvt Ltd, Mumbai iv) Further, I impose a penalty of Rs.50,000/- (Rs. Fifty thousands) on M/s Nuance Group India Pvt Ltd, Mumbai, under Rule 26 of the Central Excise Rules, 2002." 2.1 Appellant is manufacturer of cigarettes falling under Chapter Sub-Heading 2402 and has cleared the same to M/s. Nuance Group (India) Pvt. Ltd. at the duty-free shop situated at Bangalore International Airport. The clearances affected to M/s. Nuance Group without payment of duty were deemed to be provisional as these were based on the undertaking given by M/s. Nuance Group. 2.2 Alleging that M/s Nuance Group India Pvt. Ltd. was not eligible for exemption from payment of Central Excise Duty, as there was no valid provision in terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Excise Rules, 2002, in case where the assessee is manufacturing excisable goods by following the warehousing procedure under the Customs Act, 1962. By Notification No. 9/2013 - CE (NT) dated 23.5.2013, para 2A is inserted in Notification No. 36/2001 - CE (NT), whereby it is declared that a godown or retail outlet of a Duty Free Shop is appointed or licensed under the provisions of 58 of the Customs Act, 1962, such godown or retail outlet shall be deemed to be registered as warehouse under Rule 9 of the Central Excise Rules, 2002. Therefore registration under Rule 9 for duty free shop of Nuance Group was not warranted especially when their premise was registered under Section 58 of the Customs Act, 1962. CBEC Circular No. 970/04/2013 -CX., dated 23.5.2013 clarifies at para 1(i) it that duty free shops licensed under Section 58 of the Customs Act, 1962 shall be deemed to be registered under rule 9 of the Central Excise Rules, 2002 for the purpose of warehousing of excisable goods meant for sale to international passengers in terms of the Notification No. 7/2013-CE (NT), dated 23.5.2013. Undisputedly, the cigarettes were consigned directly to duty free shop, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red by M/s GPI without payment of any central excise duties, to M/s/Nuance Group(India) Private Limited, for sale by them through their Duty Free Shop (DFS) situated at International Airports at Hyderabad and Bangalore. 4. WHEREAS on the basis of said application/representation, the Commissioner of Central Excise, Mumbai IV had granted the permission to M/s Nuance Group and M/s GPI vide Letter F.No: V-30(109)T-2/Permission/MIV/08 dated 23.12.2008. The said permission was valid up to 16.05.2009 in respect of premises at Bangalore Airport and valid up to 11.03.2009 in respect of Hyderabad Airport. The permission under the above referred letter was granted for availing of the procedure of removal and receipt in bond, of cigarettes, without payment of duty, manufactured by M/s GFL. Mumbai and disposal by M/s Nuance Group through their (Nuance Group's) said Duty Free Shops, on the conditions mentioned therein and also subject to the compliance of conditions of Notification No.45/2001 CE(NT)dated26.06.2001 and the procedure as prescribed under Circular ( No.581/18/2001-Cx dated 29.06.2001. The permission so granted was also subject to following conditions and procedure laid down u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and oral submissions made by appellants and also relevant provisions of law relating to subject matter. The issue involved is duty liability on goods cleared to Duty Free Shop. The definition of export goods as per Section 2(19) of the Customs Act, 1956 says "any goods which are to be taken out of India to a place outside India". The subject goods were not taken out of Indian territory. Hence do not qualify as export goods. There is not evidence showing that goods were exported under valid S/B. Airways bill etc. The Board's letter no. 24/10/09/CXIV/8 dated 22.06.1970 was applicable only to ITDC run duty free shops. 05. The excisable goods are chargeable to Central Excise duty unless exempt. Appellant have not shown any order or authority of the department showing their eligibility for any exemption from payment of Central Excise duty as there was no provision of law for exemption from payment of Central Excise duty on these cigarette, neither a notification under section 5A of Central Excise Act, 1944 nor under any, notification issued under Rule 19 of Central Excise Rules, 2002 were in force for the relevant period. Moreover, there was no provision in existence deeming su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on apparels, fashion accessories, food and confectionaries, perfumes and cosmetics, technology and electronics etc. permitted to be sold from their four outlets at level D, E & F of the Passenger Terminal Building of the Rajiv Gandhi International Airport, Shamshabad (PTB), without payment of Customs Import Duties on Bond to Bond transfer from their Warehouse located at level B of the PTB, subject to the conditions described on reverse. The four Duty Free Shop outlets of level D, E and F of the Passenger Terminal Building of the new International Airport, Shamshabad are at the distance of about LIPS Kilometers from the Central Excise Hqrs. Office, Hyderabad". Thus it reveals that subject permission is only for imported goods and provide storage of subject goods without payment of Customs Import duties. No where it provides non payment Central Excise duty. 07. Thus, appellant have contravened provisions of rule 4 of Central Excise Rules, 2002 read with Rule 8 ibid and liable for the recovery of duty under the provisions of Section 11A (1) of Central Excise Act, 1944 and also liable for interest under Section 11AB beside liable for penalty under Rule 25 of the Central Excise Rules ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Board of Excise and Customs in terms of sub-rule (2) of rule 20 of Central Excise Rules, 2002." & Circular No 970/04/2013 dated 23.05.2013 stating as follows: (1) Registration of warehouse: (i) The godowns and the retail outlets of Duty Free Shops in the departure/ arrival side of the International Airport appointed/licensed under Section 57 or 58 of the Customs Act, 1962 shall be deemed to be registered under rule 9 of the Central Excise Rules, 2002 for the purpose of warehousing of excisable goods meant for sale to international passengers in terms of the aforesaid notification. (ii) For the purpose of control over the receipt, storage and sale of such excisable goods, the officers of Customs having jurisdiction over these godowns and retail outlets have been appointed as officers of Central Excise vide notification No. 08/2013-C.E.(N.T.), the dated 23rd May, 2013. 4.7 Further even if we agree to the contentions of the Commissioner (Appeals) then also the demand of duty should have been made from M/s Nuance Group, who had executed the Bond and Bank Guarantees for availing the benefit of duty free clearances and not the appellant. In case of Kishore Pumps Ltd., refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itial lapse, if any, committed by the exporter, of not obtaining the Block Transfer Certificate in time, stood rectified as the same was produced after the clearance of the goods as is evident from the impugned order itself. Therefore, for the minor lapse on the part of the merchant-exporter, the appellants could not be saddled with the duty demand and penalty." 4.9 Similar view has been expressed in the following decisions were the issue was in respect of non fulfillment conditions of erstwhile Chapter X procedure by the consignee/ receiver of the goods: Ferro Alloy Corporation [1994 (71) ELT 931 (T)] Vikram Enterprises [2008 (226) ELT 437 (T)] IBP Co Ltd [1999 (110) ELT 900 (T)] Hindustan Petroleum Corporation Ltd. [2011 (269) ELT (T)] 4.10 The Circular No 581/18/2001, referred by Commissioner (Appeal) states as follows: "4.2 Execution of bond 4.2.1 Every exporter registered in the aforesaid manner, shall execute before the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise having jurisdiction over the warehouse a general bond under Rule 19 of the Central Excise (No.2) Rules, 2001 for export of goods from the warehouse in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in ARE-3, can be ignored. Immediately on receipt of goods, the provisional debit shall be converted into actual debit on the basis of the details mentioned in ARE-3. 5.4 The officer-in-charge of the warehouse will countersign application and despatch to the Range Office having jurisdiction over the factory / other approved premise of removal within one working day of receipt of the application. He will make suitable entry in his own record accordingly. 5.5 The assessees shall maintain private record (Warehousing Register) containing information relating to details of ARE-3 and invoice, date of warehousing certificate, description of goods received including marks and numbers, quantity, value, amount of duty, details of operation in the warehouse and new packages and their marks and number, clearance from the warehouse for export (ARE-1 No., Invoice No., quantity, value, duty) and clearance for home consumption. They shall produce this Register to the Central Excise Officers in-charge of the warehouse whenever required." Except for stating that M/s Nuance Group, has not obtained registration under Rule 9, it is not even the case put forth by the revenue that other condition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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