The Ahmedabad bench of Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that excise duty is not demandable merely for procedural lapse in respect of admitted export of goods
The issue involved is about the alleged clandestine removal of goods based on some documents recovered from the premises of the appellants Crown Ceramics and Vishal V Shah. After a detailed investigation, the department issued a show cause notice dated 30.12.2011 proposing recovery of duty amounting to Rs. 39,43,754/-. The said show cause notice was adjudicated ex-parte on 16.11.2012 vide order no. 136/ADC/12.
On appeal, the Commissioner (Appeals) has remanded the matter to the adjudicating authority to re-adjudicate the matter based on the documents. On remand, the appellant further produced the documents before the adjudicating authority which were verified by the department through the office of the Assistant Commissioner. During the de-novo, the appellant also filed a letter along with a copy of the Chartered Accountant Certificate certifying the clearance of export and quotation.
After verification of documents submitted by the appellant, the adjudicating authority accepted that there was some trading turnover and set aside the demand for such trading turnover. However, on the issue of the value of clearances reflected in the quotation, export, rejection and Jangad (approval) sale did not agree and confirmed the demand. The Commissioner (Appeals) rejected the documents relied upon by applying the provisions of Rule 5 of Central Excise Appeals Rules 2001.
Shri Paresh Sheth, counsel appearing on behalf of the appellant submitted that as regards the allegation of clandestine removal in respect of the alleged transaction appearing in the quotation, he submitted that there is no clearance against all documents, it is only a quotation given to the probable buyers of the goods and no actual sale has taken place. He also referred to some quotations.
It was argued that there is no dispute that the goods have been exported and the appellant has produced the form-H which is admissible as proof of export, therefore, on the export clearance, demand cannot be confirmed. As regards, the demand relating to Jangad (approval), Shri Paresh Sheth does not press and accept the demand during the argument.
Shri A.K. Samota, authorized representative appeared on behalf of the respondent and reiterated the findings of the impugned order.
The Revenue did not adduce any other evidence such as transportation of goods, buyer’s statement etc., therefore, we are of the view that the demand based on quotation is not sustainable. As regards the demand for excise duty on the goods cleared for export, there is no dispute about the physical export of the goods. The only reason for the demand of duty is that the appellant has not followed the procedure.
A two-member bench comprising Mr. Ramesh Nair, Member (Judicial) and Mr. Raju, Member (Technical) observed that merely for a procedural lapse in respect of admitted export of goods, no duty can be demanded.
The CESTAT set aside the impugned order and remanded the matter to the adjudicating authority for passing a fresh order considering the above observation.
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