Commissioner of Customs Vs Adani Enterprises Ltd. (CESTAT Ahmedabad)
The Customs, Excise and Service Tax Appellate Tribunal dismissed multiple appeals filed by the Revenue against a common adjudication order that had dropped customs duty demands, confiscation, and penalties relating to imports made under Duty Free Credit Entitlement (DFCE) licences. The appeals arose from a common investigation alleging misuse of the Incremental Export Promotion Scheme through overvaluation of exports, re-export of imported cut and polished diamonds (CPD), circular trading, and wrongful duty-free import of gold and silver bars.
Read SC Judgment in this case: DFCE Duty-Free Import of Gold & Silver Bars Valid: SC Rejects Alleged Circular Trading & Fraud
The Revenue’s case was founded on intelligence suggesting that DFCE licences were fraudulently obtained by showing inflated incremental exports and by re-exporting imported CPDs without genuine processing, thereby claiming export benefits. It was alleged that gold and silver bars had no nexus with the exported CPDs and that DFCE benefits were wrongly availed. Show cause notices were issued demanding duty under Section 28 of the Customs Act, proposing confiscation and penalties.
The Tribunal examined the factual background in detail and noted that similar allegations had earlier been raised in a prior show cause notice issued in 2007 concerning comparable transactions. Those allegations had been conclusively rejected by the Tribunal in 2015, with findings that there was no circular trading, no overvaluation, and that the exports were genuine. That decision had been affirmed by the Supreme Court, and review petitions had also been dismissed. The Tribunal held that the present proceedings were based on substantially the same investigations and allegations, and therefore the issues were no longer open for re-litigation.
