The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), quashed the allegation of clandestine removal of chemicals without payment of excise duty and observed that expert evidence cannot be brushed aside for non-technical reasons.
M/s FIL Industries Pvt Ltd. earlier known as (M/s Kohinoor Industrial Agro Products), are an Export-oriented unit (EOU) engaged in manufacture and export of Apple Concentrate and they have imported three chemicals viz. Captan Tech, Dodine Tech and Carbendazim Tech in March and June 2000 and they have applied for permission to the Department to clear these inputs for processing by a job worker.
Meanwhile the appellants have claimed to have utilized some of the inputs in the processing of apples; the Department issued a show-cause notice alleging that the said goods are not usable for post-harvest activity and as such, the appellant’s claim is incorrect and the said goods have been removed clandestinely without payment of duty.
The Counsel for the appellant submitted that there is no shred of evidence that the chemicals were removed clandestinely and no evidence in the form of transportation/ sale of the said inputs is produced. Therefore, the Department cannot allege clandestine removal on the basis of certificates given by technical persons.
It was further submitted that a number of times officers have visited the premises and no discrepancy of stock of inputs has been found and the impugned order is silent whether balance stock was verified on 04/05-09-2001 and that the assertion of the Department that the chemicals have been used after the expiry shelf life is not based on any proof.
A Two-Member Bench comprising SS Garg, Judicial Member and P Anjani Kumar, Technical Member observed that “The certificates issued by other agencies and the Deputy Director of Horticulture, Government of Jammu & Kashmir speak of the possibility and feasibility of the use of the impugned chemicals in the post-harvest treatment of apples. As submitted by the learned Counsel for the respondents, we find that the expert evidence given cannot be brushed aside for non-technical reasons. If the Department did not want to rely upon the technical opinion, the same should have been done by countering technical opinion by expert opinion authoritatively countering the opinion given.”
“Under the circumstances, allegation of clandestine removal bereft of any evidence cannot be upheld. We find that the learned Commissioner observed that no evidence was put on record to substantiate the said allegations; the show-cause notice is silent on important issues like from where the job work was done, to whom and how these chemicals were sent; onward movement and return of formulations and there is no evidence on the purported use of the formulations in any of the orchards” the Bench concluded.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
