Amar Cold Storage Vs C.C.-Jamnagar (Prev) (CESTAT Ahmedabad)
CESTAT held that change of circumstances by way of clarification issued by the DGFT and withdrawal of the show cause notice, there was no scope for adjudicating authority to deviate from the decision taken by the DGFT to classify the goods under DEPB Entry at Sr.No.2/66 therefore, the adjudicating authority has no authority to sit over the policy decision taken by the DGFT. We are therefore of the view that the clarification given by the DGFT will prevail over the allegation made by the Customs Department therefore, the entire adjudication order passed discarding the decision taken by the DGFT cannot be sustained.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The brief facts of the case are that an intelligence was received by the department that the appellant are engaged in the manufacturing of „Surimi‟ and exporting the same in the name of processed, preserved and frozen surimi under the DEPB credit declaring the product under Sr. No.2 of the group code no. 66 of Fish & Fish Products of the DEPB Schedule. A case was made out by the department on the ground that the product manufactured and exported by the appellant falls under Sr.No.1 of group code no.66 under the description of Fish & Fish Products including frozen meat and thus the appellant have wrongly taken benefit by availing DEPB. A show cause notice was adjudicated by the adjudicating authority whereby, it was ordered for recovery of Rs.79,78,420/- under proviso to section 28(1) of the Customs Act, 1962 along with interest under Section 28AB and also imposed penalty of Rs.50 lakhs under Section 114(ii) of the Customs Act, 1962. Being aggrieved by the Order-In-Original, the appellant filed present appeal.
02. Shri R. Subramanya, learned counsel appearing on behalf of the appellant submits that there was a dispute about the classification of the goods under DEPB Schedule and with reference to the said dispute even the appellant was also issued a show cause notice 03.04.2007 by Office of Joint Director General of Foreign Trade, Rajkot making the same allegation and wrong availment of excess amount of DEPB amounting to Rs.79,78,420/- thereafter, on appellant’s persuasion with DGFT- Delhi through „The Seafood Exporters Association of India’ the DGFT vide letter dated 9th January, 2009 clarified that the appellant is entitled for DEPB on export of „Surimi’ as DEPB Entry at Sr. No.2/66 of the then DEPB Rate Schedule. He submits that after this clarification issued by DGFT in favour of the appellant, the DGFT vide letter dated 21.05.2012 withdrawn the show cause notice dated 03.04.2007. He submits that as per the above sequential development and clarification by DGFT, the issue is no longer under dispute accordingly, the demand of DEPB credit is not admissible.
03. On the other hand Shri Dinesh Prithiani, learned Assistant Commissioner (AR) appearing on behalf of the revenue reiterates the finding of the impugned order. He submits that the decision was taken to classify the appellant’s product under Sr.No.1 by the DEPB Committee vide corrigendum dated 06.01.2006 whereas, the clarification given in respect of appellant is only by way of letter and on that basis it cannot be accepted that the product of the appellant is classifiable under Sr.No.2 of group code of 66 of DEPB Schedule. He placed reliance on the following decisions:-
