TIOL-DDT 125 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b><font color="#663399" size="3">TIOL-DDT
125</font><br>
31 05 2005<br>
Tuesday</b></font></p>
<p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>What
happens if post-importation conditions are not fulfilled?</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Certain goods are imported at nil rate or concessional rate subject to the
importer fulfilling certain post-importation conditions. After import, the
importer is not able to fulfil these conditions. What happens? <br>
<br>
1. Demand of duty<br>
2. Confiscation and redemption fine<br>
3. Penalty <br>
4. All the above<br>
<br>
This was the subject in a recent case before the CESTAT. A major public sector
undertaking, Steel Authority of India Limited imported two cranes under concessional
rate of duty under the EPCG scheme. The department issued Show Cause Notice
on the grounds that the cranes were not at all capital goods and were not
entitled to the benefit of the exemption notification as they were not used
in the manufacture of goods. The cranes were used in their stock-yard and
not in their factory. As usual the Commissioner confirmed the duty, confiscated
the goods and imposed a penalty, of course allowing release of the goods on
redemption fine. <br>
<br>
The Committee On Disputes (COD) felt that as there was no suppression, the
PSU should be permitted to contest imposition of penalty and redemption fine.
<br>
<br>
In deciding the issue, the Tribunal observed that there are two points for
consideration<br>
<br>
1. Whether the cranes were entitled for consessional rate of duty<br>
<br>
2. Whether the goods are liable for confiscation and consequently fine and
penalty. <br>
<br>
In a simple logical conclusion, the Tribunal observed that the cranes were
not eligible for the concessional rate of duty as held by the adjudicating
authority. If that is so, the notification is not applicable and they will
have to discharge the full duty which they had already done. Once they have
paid the differential duty, the goods go out of the purview of the notification.
And once they are outside the purview of the notification, the question of
fulfilling the conditions of the notification does not arise and once this
question does not arise, the goods are not liable for confiscation and consequently
there is no question of fine and penalty. <br>
<br>
The logic is the Government cannot have the cake and eat it too. See </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=52&filename=legal/cestat/2005/2005-TIOL-445-CESTAT-BANG.htm">2005-TIOL-445-CESTAT-BANG</a></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<br>
<b>SNIPPETS </b><br>
<br>
<b>Excise helpline:-</b> Mangalore has become the first Commissionerate to
have a helpline on Central Excise and Service Tax in the nation. The helpline
was inaugurated by Central Excise chief commissioner, G.K.Pillai. The helpline
will function from the premises of the Kanara Chamber of Commerce and Industry
(KCCI).</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<br>
<b>Airport staff smuggling drugs:</b> Workers at the airport, including baggage
handlers with high-level security clearances, have been involved in drug-smuggling
and stealing from passengers, according to a classified Customs report that
also suggests staff pose a terrorism threat. A probe by investigators into
airport workers from toilet cleaners to pilots has found evidence of alleged
criminal conspiracies between groups of employees with access to the most
secure areas of the airport. This has happened not in India but in distant
Australia. We need not feel ashamed about our airport staff!<br>
<br>
<b>Customs officers develop nose and throat irritations – Rainbow Bridge
closed.</b> The Rainbow Bridge, which connects the United States and Canada
at Niagara Falls, was shut down for five hours amid fears that a hazardous
material had been released. Several U.S. customs officers on the bridge developed
nose and throat irritations as they examined cash that was hidden in a vehicle.<br>
<br>
<b>Australian woman gets 20 years for smuggling marijuana into Indonesia.</b>
A young beautiful Australian woman, Corby, was sentenced to 20 years in prison
by an Indonesian court for smuggling in 4.1 kgs of marijuana in an open bag.
<br>
<br>
The Australian prime minister expressed sympathy for Corby but urged Australians
to remain calm. He said, "I ask that we all pause and understand the
situation and recognize and respect that when we visit other countries we
are subject to the laws and rules of those countries. We have neither the
power nor the right to intervene." Corby, a beauty school student, was
arrested in October after airport authorities found marijuana in her surfboard
bag as she arrived on Bali for a family holiday. Her lawyers allege the drugs
were planted in her bag by airport baggage handlers in Australia as part of
a drug-smuggling operation. But the Indonesian prosecutors are not happy with
the verdict. They are going to appeal. They want a life sentence for her.
By any chance, is the girl innocent? If so imagine the tragedy!<br>
<br>
<font color="#FF6666"><b>Until Tomorrow with more DDT<br>
<br>
Have a Nice Day. <br>
<br>
Mail your comments to</b></font> <b>vijaywrite@taxindiaonline.com </b></font>
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