Larsen & Tourbo Limited Vs Commissioner of Customs (CESTAT Ahmedabad)
In this case before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad, a customs duty demand and penalty were imposed on the appellant company on the ground that materials brought ashore had not suffered customs duty and were allegedly concealed. The department contended that duty had not been discharged on these materials and sought to recover customs duty along with penalties.
The appellant maintained that the materials in question were leftover materials from operations at Bombay High and were not freshly imported goods. It was asserted that these were either imported materials on which customs duty had already been paid at the time of importation or indigenous materials on which excise duty had been discharged. The appellant clarified that the fastening materials were scrap generated during fabrication and manufacturing of offshore platform structures. Such scrap arose from both imported and indigenous steel plates and pipes. Customs duty was paid on scrap generated from imported raw materials during in-bond manufacturing under Section 65 of the Customs Act, 1962, while excise duty was paid on scrap generated from indigenous materials. Due to the inability to segregate the nature of scrap, customs duty was paid on the scrap generated.
