The Kolkata bench of the Customs Excise and Service Tax Appellate Tribunal ( CESTAT ) has set aside the excise duty demand after finding no evidence to support allegations that mild steel billets were exported as alloy steel forgings.
The brief facts of the case are that during the Period under dispute from 20.06.2003 to 02.08.2003, the Appellant has supplied Alloy Steel Ingots to M/s. S.F. Forgings Pvt. Ltd .The purchaser M/s. S.F. Forgings Pvt. Ltd. had manufactured goods i.e. Alloy Steel Forgings and supplied the same to one merchant exporter by name M/s. Bankey Behari Commercial Pvt. Ltd, who in turn had exported the goods and availed rebate of duty.
The Appellant submitted that as a merchant exporter they have exported Alloy Steel Forgings and claimed rebate of Rs.74, 48,840/-. They submit that the said Alloy Steel Forgings were manufactured by M/s. S.F. Forgings and duly exported under the cover of ARE-1 Forms. The goods were stuffed in the premises of the manufacturer and the export consignments were sealed by the central excise officers with One Time Seal. Later, the said consignments were exported under Customs supervision; the Department could not submit any evidence to establish their theory of export of Mild Steel Billets in the place of Alloy Steel Forgings. It was alleged that Appellant has procured Mild Steel Billets from M/s. Concast Pvt. Ltd.; however, no evidence has been adduced by the Department to substantiate that claim. The Department has not challenged the declarations made by the Appellant in the shipping bills and hence the assessment of the shipping bills attained finality.
Accordingly, further submitted that there was no substance in the allegation of the Department that the goods viz. Alloy Steel Forgings have not been exported. Thus, they contended that they have rightly claimed the rebate on the goods exported and the demands confirmed in the impugned order against them are not sustainable.
The bench observed that the issue originated from the rebate of Rs.74, 48,840/- claimed by the Appellant as a merchant exporter on export Alloy Steel Forgings. The appellant has purchased the said Alloy Steel Forgings from M/s. S.F. Forgings and duly exported the same under the cover of ARE-1 Forms, sealed under the supervision of central excise officers. However, the Department alleged that the appellant has actually exported Mild Steel Billets in the guise of Alloy Steel Forgings. The goods were stuffed in the premises of the manufacturer and the export consignments were sealed by the central excise officers with One Time Seal.
Accordingly, the two member bench of the tribunal comprising K. Anpazhakan ( Technical member ) and Asok Jindal (Judicial member) held that there was no evidence available on record to substantiate the allegation of the Department that the Appellant has not exported the goods Alloy Steel Forgings. Thus, CESTAT held that Appellant has rightly claimed the rebate on the goods exported and the demands confirmed in the impugned order against them are not sustainable. Accordingly, CESTAT set aside the demand of duty along with interest and penalty confirmed against Appellant.
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