Page 128 - ELT_3rd_1st May 2020_Vol 372_Part

350 EXCISE LAW TIMES [ Vol. 372

of the department, the petitioners cannot be penalized. It is also alleged that the
attention of the adjudicating authority was also drawn to the fact that the materi-
al imported is against valid authorization issued by the DGFT and none of the
authorization are declared as invalid or cancelled. That neither the custom de-
partment nor the department of DGFT has ever raised any objection or has ever
stated that the petitioner has violated any of the condition of the Notification No.
96/2009-Cus. availed and, therefore, the demand of custom duty is also not sus-
tainable and is bad in law. It is also contended that adjudicating authority has
confirmed the show cause notice without considering the submissions made and
as also the documentary evidence produced and the order passed by the adjudi-
cating authority is bad in law and without jurisdiction. It is submitted that the
duty of the Central Excise demanded is equal to the duty refunded by the de-
partment of DGFT and is not based on transaction value and since the refund is
neither issued by Customs Department nor by Central Excise Department, the
demand raised is bad in law and without jurisdiction. It is contended that the
show-cause notice clarifies that the refund is of the Cenvat paid and hence, re-
covery of Central Excise Duty would amount to double recovery of duty and is
without jurisdiction and bad in law. On all these grounds, the petitioners have
challenged the impugned order passed by respondent No. 2.
5. The respondent No. 2 has filed affidavit-in-reply refuting the claim
of the petitioner-company in toto and has stated that there is alternative remedy
available to the petitioners and, therefore, on this ground, the present petition
deserves to be dismissed. It is also stated that respondent-department is well
within the jurisdiction to issue show cause notice. The main contention of the
respondent is that the petitioners have shown clearance of 248204 kilogram brass
rods/brass hollow rods/copper alloys ingots totally valued at Rs. 8,27,36,245/-
to four 100% EOUs on payment of Central Excise Duty from Cenvat account to-
tally valued at Rs. 90,59,957/- was claimed back through refund of TED (Termi-
nal Excise Duty) from the DGFT based on the declaration that the goods were
cleared to 100% EOUs. According to respondent No. 2, all such clearances ap-
peared not genuine and RIPL in the guise of deemed export clearance to 100%
EOUs removed all such goods to the local market clandestinely. According to
respondent-authority, the amount debited by them from Cenvat account of the
aforesaid amount has already been refunded in form of TED from the DGFT and,
therefore, demand of Central Excise Duty would not amount to double recovery
of duty. It is stated that M/s. RIPL has shown in the invoices the duty payment
but not collected the same from the buyer and subsequently, the same was
claimed as refund from DGFT as TED. According to respondents, this has been
done to avoid the physical verification of the receipt of the goods by the Central
Excise Officers. According to respondent No. 2, if the supplies is made without
payment of duty under CT-3, the physical supervision of the Central Excise Of-
ficers is mandatorily required so that they can send the re-warehousing certifi-
cate to the supplier Range Office. According to respondent, since, the supplies
were shown as duty paid, it is not mandatory for physical verification and even
accompany ARE-3 is also not required. According to respondent, all the docu-
mentary evidence have been examined and after verifying everything, the de-
mand has been confirmed and merely tendering of the affidavit of 100% EOU is
not enough.
6. On behalf of the petitioners, the Director of the petitioner company
has filed affidavit-in-rejoinder wherein it has refuted the facts narrated by the
EXCISE LAW TIMES  1st May 2020  128