Fiberweb India Ltd Vs C.C.E. & S.T. Daman (CESTAT Ahmedabad)
The appellant relied on various case laws to emphasize that Anti Dumping Duty could not be levied on raw materials brought under bond for goods cleared in Domestic Tariff Area (DTA). The counsel argued that the nature of the goods changed following the manufacturing process and thus, the levy of Anti Dumping Duty was inappropriate. However, the Tribunal found force in the argument by the Revenue that an amendment in 2008 mandated the payment of Anti Dumping Duty, even on DTA clearances, irrespective of the nature of the raw material after manufacturing.
Department while demanding duty was not sure of the provision of law under which the same had to be demanded and even the penalty has been imposed under Section 112 of Customs Act, 1962, whereas the duty should have been demanded under Central Excise Act and penalty imposed under Central Excise Act/ Rules only.
In view of the above factual details of the matter, CESTAT hold that the demand can be sustained only for the normal period of limitation and that penalty under section 112 of Customs Act, 1962 does not sustain.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The appellant is 100% EOU engaged in the manufacture of Polypropylene Spun Bond Non-Woven Fabrics. They imported raw-material “Polypropylene” from Singapore for use in manufacture for the final product. They also made DTA clearances during the impugned period of 01 August, 2009 to 31.03.2015 as per permission accorded to them by the Development Commissioner after processing the raw-material on payment of applicable Customs Duties as per Section 3(i) of the Central Excise act, 1944. The show cause notice was issued to them on 19.06.2015 demanding Anti Dumping Duty on imported “Polypropylene” used for the manufacture of finished goods and the same was demanded by invoking provision of Notification No. 5/94-CUS read with Notification No. 52/2003-CUS dated 31.03.2003 read with Section 9A (2A) (ii) of Customs Tariff Act, 1975. It was adjudicated against the appellant company and its director and has led to the present appeal by the aggrieved persons.
2. Learned Counsel for the appellant relied upon various case law to emphasise that when the goods are cleared in DTA, the Anti Dumping Duty could not be levied on raw material brought under bond, as goods were not having same characters after manufacturing process as the original raw material which was imported. The Counsel relied upon the following Judgments:-2008 (224) ELT 113 (Tri. Ahmd.)- C.C, KHANDLA Vs. RAM KRISHNA EXPORTS and also 2013 (290) ELT 372 (Tri. LB)- KUMAR ARCH TECH PVT. LTD vs. CCE, JAIPUR-II to indicate that once the goods are manufactured and cleared in DTA by EOU, only Central Excise Duty could be levied on the clearance and same is determined according to aggregate of Customs Duty applicable and therefore the demand of duty under Customs Act and its provision was improper. He also relied on various other Judgments to emphasize the twin points as follows:-
