Page 255 - ELT_1st September 2020_Vol 373_Part 5

2020 ] COMMR OF CUS., C. EX. & S.T., HYDERABAD-II v. G.M.K. PRODUCTS PVT. LTD. 693

redemption fine under said Section 125 ibid also does not arise - Penalty under
Section 114A ibid also unsustainable as section provides for “penalty for short
levy or non-levy in certain cases” and evidently, no duty is involved in said
case - Sections 114, 114A and 125 of Customs Act, 1962. - If goods are held liable for
confiscation under Section 113 ibid and the option is given under Section 125 ibid the
exporter may not choose the option at all and he does not have to pay the redemption fine.
On the other hand, if he chooses to pay the redemption fine then the department is bound
to give him possession of the goods which is impossible as the goods have already left the
country. For this reason also, the confiscation under Section 113 and the redemption fine
under Section 125 are not sustainable as per law in respect of exported goods. [paras 8, 9]
Matter remanded
CASE CITED
Shravani Imports Pvt. Ltd. v. ADG, DRI — 2010 (252) E.L.T. 19 (A.P.) — Referred ........................ [Para 5]
REPRESENTED BY : Shri A.V.L.N. Chary, Superintendent, for the
Appellant.
Shri B. Satyanarayana, Advocate, for the Respond-
ent.
[Order per : P.V. Subba Rao, Member (T)]. - This appeal is filed against
Order-in-Appeal No. 73/2009(H-II) Cus., dated 30-9-2009 and has been filed by
the Revenue.
2. The Respondent herein, a private limited company is a merchant ex-
porter engaged in export of cylinder liners/sleeves, cast iron castings to various
countries. They purchase the goods from M/s. Kusalava International Ltd., Vi-
jayawada, M/s. Chakkapalli Exports, Vijayawada, etc. They have been exporting
the goods under DEPB scheme claiming that the goods which fall under serial
No. C-379 of the DEPB schedule.
3. DEPB is a scheme of the Ministry of Commerce and the Directorate
General of Foreign Trade which gives incentive to the exporters by way of credit
(DEPB credit) as a percentage of the value of exports which can be used towards
payment of import duty on any products. For the purpose of DEPB credit a sepa-
rate schedule is prepared by the DGFT which is not based on HSN or the Cus-
toms Tariff.
4. The respondents were investigated by the DRI officers as it was felt
they were misclassifying their export products under the DEPB schedule with
the intention of claiming higher DEPB credit. The officers visited various premis-
es of the respondent, obtained relevant records and registers and after scrutiny
came to the conclusion that the respondent had misdeclared the export goods in
their shipping bills as “cast iron or castings (machined) (for cylinder liners)”
whereas the same should have been correctly classified as “cylinder lin-
ers/cylinders/top cap sleeves (admittive cost products/identifiable ready to use
machine parts of iron)” falling under Serial No. 65/531 of engineering products
(61) of the DEPB credit schedule. It also appeared to the officers that the DEPB
credit must be appropriately reduced and the exported goods were liable for
confiscation under Section 113(h)(i) of the Customs Act, 1962 as the respondents
have mis-declared the nature of the goods. It further appeared to them that the
respondents were liable for penalty under Section 114 and 114A of the Customs
Act, 1962. Further, it appeared that the DEPB credit sought to be availed by the
respondent amounting to Rs. 2,48,253/- on the exported goods are liable to

EXCISE LAW TIMES  1st September 2020  255