CX - Notfn. 22/03 - non-receipt of warehousing certificate - since consignee has paid duty, department cannot recover duty twice for same consignment from consignor and moreover as per Rule 20(3) of CER it is responsibility of buyer to pay duty: CESTAT
By TIOL News Service
MUMBAI, MAR 04, 2016: THE appellants are engaged in the manufacture of pollution control equipment and spares.
On the basis of CT-3 certificate read with Notification 22/03-CE dated 31.03.2003, the appellant supplied parts of pollution control equipment @ Nil duty to EOU/STP/EHTP.
During the course of EA-2000 audit, it was observed that the re-warehousing certificate was not received by the appellant within 90 days from the date of clearance and, therefore, the appellant was asked to pay the duty. Thereafter the appellant paid the duty provisionally through Cenvat Credit on 19.01.2009.
A SCN came to be issued on 20.03.2009 demanding CE duty of Rs.2,76,684/-; seeking appropriation of the amount paid and imposition of penalty and interest.
The original authority confirmed the demand; appropriated the amount already paid and imposed equivalent penalty and also interest.
This order was upheld by the Commissioner (A).
In the meantime, the Asst. Commissioner of Customs, Mumbai issued a letter of the customer, M/s. CFC India Services P. Ltd. dated 17.05.2010 directing them to pay the duty of Rs.3,65,856/- along with interest on the ground that the capital goods (Parts of Air handling units) were purchased by them against CT-3 certificate dated 31.03.2007 from appellant but the same were not re-warehoused by them and hence they have violated the provisions of said notification 22/2003-CE dated 31.03.2003. Thereafter, M/s. CFC India Services P. Ltd. vide their letter dated 26.05.2010 stated that they were ready to pay the required duty with interest and thereafter the appellant deposited Rs.3,65,856/- and Rs.1,76,212/- respectively towards duty and interest.
Before the CESTAT, the appellant submitted that in view of the material facts viz. the customer having paid the entire amount of duty and interest as directed by the Asst. Commissioner, Customs and once it has been accepted by the department, the very same amount of duty in respect of the very same clearance cannot be again demanded from the appellants. Moreover, in view of the Tribunal decision in Skyron Overseas - 2009-TIOL-2414-CESTAT-AHM it is the responsibility of the Superintendent-in-Charge of the consignee unit and consignor cannot be faulted for non-receipt of original copy of the warehousing certificate duly countersigned by the Range Officer. This position is also affirmed by Condition No. 5 of the impugned notification and rule 20(3) & 20(4) of CER, the appellant submitted. The plea of time bar is also taken.
The AR justified the order of the lower authorities.
The Bench observed -
++ It is a fact that with regard to the same consignee the Asst. Commissioner of Customs issued a letter to M/s. CFC India Services P. Ltd. demanding the duty and interest for violation of the conditions of notification 22/03-CE and the appellant's customer M/s. CFC India Services P. Ltd. has paid the entire duty of excise along with interest to the department and thereafter with regard to the same consignment the department cannot ask the appellant to pay the duty as the department cannot recover the duty twice for the same consignment and moreover as per the sub-clause (3) of Rule 20 it is the responsibility of the buyer to pay the duty and in the absence of non-payment, recovery proceedings can be initiated against the buyer. In this case the said duty was recovered. Therefore, I find that the appellant is not liable to pay duty and moreover the case law cited by the appellant supra also supports the case of the appellant.
The appeal was allowed with consequential relief on the added ground that the demand is time barred as the Revenue had failed to prove suppression of facts with intent to evade payment of duty.
(See 2016-TIOL-534-CESTAT-MUM)
