The Bangalore Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) observed that the appellant had obtained permission for de-bonding the burnt capital goods under the customs procedures hence there is no basis for the extended limitation.
The Appellant Mineral Enterprises Limited had imported one power screen track mounted screening plant T Chieftain valued at Rs.78,12,454/. Though the Development Commissioner vide their letter dated 14.12.2007 had permitted for debonding of the above capital goods, the appellant had not de-bonded them.
Meanwhile, a mob of villagers on 24.07.2008 entered their premises and burnt the capital goods. Subsequently, to this the goods were de-bonded and cleared as scrap and paid the relevant duties accordingly.
However, a notice was issued for demanding the differential duty on the original capital goods, which was adjudicated by the Original Authority confirming the demand and upheld by the Commissioner (Appeals) in the impugned order.
N. Anand, Counsel for appellant submitted that both the show-cause notices invoking extended periods under provision to Section 28(1)/28(4) of the Customs Act, 1962 are not sustainable.
Further the counsel argued that the notice was issued under Section 28 but the demand has been confirmed under Section 72 of the Customs Act thus the order has traversed beyond the scope of the show-cause notice and cannot be upheld.
K. A. Jathin, Counsel for the department submitted that against the appeal filed by the Department before the Commissioner (A) for demand of penalty equivalent to duty and interest, the Commissioner (A) upheld the penalty equivalent to duty and interest.
It was observed by the tribunal that in this case two appeals are filed both appellant and respondent for against the Order-inOriginal No.11/2014 dated 12.02.2014 for setting aside the entire order and the impugned order confirms the demand of duty along with interest and drops the penalty imposed under Section 114A of the Customs Act. Therefore both issues are the same .
Further the bench noted that miscreants set fire to the crusher and screening equipment at Abbige near Chikkanayakanahalli during a protest by farmers against recommencement of mining activities. Apparently, the appellants 100% EOU located at the above place the impugned capital goods were destroyed by the mob of villagers.
Accordingly the appellant had intimated about the riots and took the necessary permissions from the authorities concerned for debouncing the burnt capital goods as per the Customs procedures and to pay duty on the scrap value on the highest bidder of the scrap.
A Two-Member Bench comprising D.M. Misra, Member ( Judicial Member ) and R. Bhagya Devi, Technical Member observed that the appellant had obtained permission for de-bonding the burnt capital goods under the customs procedures hence there is no basis for the extended limitation.
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