Case Law Details
Rajhans Impex Pvt Ltd Vs Union of India (Gujarat High Court)
Conclusion: Since Central Excise Department had not sanctioned any refund / rebate of the duty paid on the supplies to the EOUs by assessee-company and the refund of TED was sanctioned by the DGFT thus, if DGFT had acted under the different provisions and the refund was sanctioned under those provisions, the proper authority was DGFT who could initiate proceedings against the assessee-company for violation of exemption notification and the Advance Authorization Licence not the Central Excise Department.
Held: Assessee-company was under the control of Superintendent of Central Excise, Jamnagar. It was regularly exporting its final product as also supplying to 100% EOU (Export Oriented Unit) by following the procedure prescribed under the law. During the period from May 2010 to January 2013, assessee – company supplied material to 100% EOU under the law against the application made for Advance Authorization with payment of duty and without Form CT-3 certificate. On completion of such deemed export and receipt of Export Obligation Discharged Certificate, a request was made to issue Advance Authorization with the office of Joint Director General of Foreign Trade. Assessee-company were granted the benefits of the advance authorization scheme which was issued to allow duty free import of inputs. During the investigation by the DRI, it was found that assessee had clandestinely, instead of actually exporting the goods to EOUs, disposed of the goods in the open market and the deemed exports which were shown to have been made by assessee was made without any CT-3 and on the basis of the payment of the central excise duty which was later claimed back by them through refund of the TED from the DGFT, Rajkot. Therefore, DRI had issued the notice proposing recovery of excise duty refunded by the department of DGFT by way of TED for the material supplied to 100% EOU (deemed export) as well as proposing recovery of interest and imposition of penalty on assessee, as also on the co- noticee. In the present case, Central Excise Department had not sanctioned any refund / rebate of the duty paid on the supplies to the EOUs. It also appeared that the refund of TED was sanctioned by the DGFT and if DGFT had acted under the different provisions and the refund was sanctioned under those provisions, the proper authority was DGFT who could initiate proceedings against the assessee-company for violation of exemption notification and the Advance Authorization Licence. It was an admitted fact that Advance Autorization Licence of assessee was still valid and no action was taken by the DGFT for breach of condition thereof. As such, initiation of proceedings by the customs was nothing but an exercise of power in excess of jurisdiction. When the Custom Department had exercised power in excess of jurisdiction, than, this Court could exercise its extraordinary writ jurisdiction under Article 226 of the Constitution of India. Therefore, the order-in-original was required to be set aside.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
1. As all the three petitions are arising out of the same order which the same is challenged by the petitioners by filing
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