The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) held that confirmation of differential duty not proposed in show cause notice ( SCN ) cannot be sustained.
The appellant filed Bills of Entry for clearance of imported goods declared as “Sonalleve MR HIFU KIT (Accessories for MRI system)” declaring assessable value at Rs.11,05,381/-. These Bills of entry were assessed under RMS. The importer had declared the goods as accessories of MRI system and classified them under 90181300 claiming concessional rate of Basic Customs Duty at 5% as per serial no.357B (ii) of Customs Notification No. 021/2012 – Cus and CVD at nil rate in terms of serial no. 59(i) of Central Excise Notification No.6/2006.
The counsel for the appellant contended that the demand confirmed cannot sustain for the reason that the Show Cause Notice is cryptic and does not contain the details of the allegations. It was pointed out by the Counsel that the allegation in the SCN is “wrong availment of benefit of Notification No 21/2002 at Sl. No. 357B (ii) as accessories”. The said allegation is too vague and does not specify as to why the department alleges that the subject goods are not accessories.
Further, the decision in the case of CCE BAN VS. Brindavan, was relied by the Counsel to argue that the Show Cause Notice is the foundation on which the department has to build the case and if the allegations in the Show Cause Notice are not specific, it would be sufficient ground to hold that the noticee was not given proper opportunity to meet the allegations.
A Two-Member Bench comprising Vasa Seshagiri Rao, Technical Member and Sulekha Beevi CS, Judicial Member observed that “Moreover in present case, the allegation raised in the Show Cause Notice is that the appellant has wrongly availed benefit of Notification 21/2002 Cus at serial no. 357B (ii) in regard to BCD. There is no mention of wrong availment of CVD under Notification No.6/2006. However, the impugned order has denied the exemption of CVD available @ serial no. 59 (i) of Central Excise Notification No. 6/2006. The argument of the Counsel that the impugned order has travelled beyond the scope of the Show Cause Notice is not without substance. The confirmation of the differential duty which has not been proposed in the Show Cause Notice cannot be sustained. For this reason also the demand of differential duty cannot sustain.”
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