The Mumbai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the Customs duty demand on the manufacture of polyurethane polyvinyl chlorine soles of footwear on the ground of absence of Malafide Intention.
Shoe World (Bajwa) Exports, the appellant assessee was a manufacturer and exporter of polyurethane polyvinyl chloride soles of footwear and issued with two Zero Duty Export Promotion Capital Goods (EPCG) Licences on 19.07.2011 and 03.08.2011 and also issued with three Status Holder Incentive Scheme (SHIS) Licences on 09.03.2011, 06.05.2011 and 23.05.2013.
The assessee appealed against the order passed by the Commissioner (Appeals) for demanding recovery of customs duty of Rs.15,29,559/-. There were other proposals for the imposition of penalty.
Rinki Arora, the counsel for the assessee contended that the contention in the show cause notice that the assessee had misdeclared and suppressed information was factually not correct.
Also submitted that the assessee had complied with all the provisions as they existed during the material time and there was no malafide on the part of the assessee. Therefore, the allegation of suppression in the show cause notice was not sustainable.
Deepak Sharma, the counsel for the department relied on the decisions made by the lower authorities and contended that the customs duty foregone concerning Zero Duty EPCG Licence should be recovered from the assessee and the demand raised by the revenue was as per the law and liable to be sustained.
The Bench observed that the allegation of suppression in the show cause notice was not proved by the revenue and do not find any irregularity on the part of the assessee for Revenue to recover customs duty of Rs.15,29,559/- under extended period of limitation.
A single-member bench comprising Anil G. Shakkarwar (Technical) quashed the customs duty demand imposed against the assessee while allowing the appeal filed by the assessee.
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