TMI Blog2004 (10) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to 5 times the CIF value within a period of 5 years. Since the appellants could not fulfil the export obligation in terms of the Notification, the department initiated proceedings against them for the recovery of differential duty of Rs. 37,41,081/- being the difference between the actual duty but for the notification and the duty paid under concessional rate. The Adjudicating authority after giving a personal hearing to the appellants confirmed the demand with interest at the rate of 24% as per condition No. 5 of Notification 110/95-Cus., dated 5-6-1995. BG executed by the appellants for an amount of Rs. 37,41,081/- was ordered to be enforced and adjusted towards duty payable. The total interest payable was arrived at as Rs. 50,55,072/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to do, hereby exempts goods as specified in the Table annexed hereto from so much of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as is in excess of the amount calculated at the rate of 15% ad valorem and whole of the additional duty leviable thereon under section 3 of the said Customs Tariff Act, subject to the following conditions, namely :- (1) The goods imported are covered by a valid licnece issued on or after 1st May 1995 under the Export Promotion Capital Goods (EPCG) Scheme in terms of Export and Import Policy hereinafter referred to as the said Policy permitting import on payment of duty of customs at the rate of 15% and the said licence is produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lar year is not fulfilled in terms of the preceding condition, the importer shall within three months from the expiry of the said year pay an amount equal to that portion of the duty leviable on the goods but for the exemption contained herein which bears the same proportion as the unfulfilled portion of the export obligation bears to the total export obligation. (5) The importer shall, if he fails to discharge a minimum of 25% of the export obligation prescribed for any particular year, for three consecutive years, be liable to pay forthwith the whole of the duty of customs leviable on the goods imported but for the exemption contained in this notification. (6) The capital goods imported, assembled or manufactured are install ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5% of the export obligation prescribed for any particular year, for three consecutive years so that the department does not demand full duty from him. In a more precise manner, condition 5 stipulates that when there is a failure to discharge a minimum of 25% of the export obligation prescribed for any particular year for three consecutive years, the importer shall be liable to pay forthwith the whole of the duty of customs leviable on the goods imported but for the exemption contained in the notification. A perusal of the annual performance of the appellant indicated above reveals that in the fourth year, the appellants fulfilled 9.28% of export obligation whereas the export obligation prescribed as per the Notification is 30%; 25% of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harmonious reading of the entire notification reveals that when an importer partially fulfills the export obligation, full duty of customs on the entire goods imported cannot be demanded. Duty can be demanded only for failure to satisfy the condition No. 5 of the Notification but in this case, the department has demanded the full duty leviable from the appellant and the department is not correct. To that extent the OIO and the OIA are not legal and good. As regards the actual liability of the appellant, to pay duty on imported goods, we have to consider yearly performance. If in each year, he fulfils the prescribed export obligation, no duty will be demanded from him other than what he paid at concessional rate. But when there is default, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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