Commissioner of Customs vs Sajawat Industries Ltd.

K.L. Manjunath, J.—The revenue has come up in this appeal challenging the order of remand passed by the CESTAT in Customs Appeal No. 207 and 208 of 2002 in Final Order Nos. 1315 & 1316 of 2006, dated 27-6-2006 2007 (219) E.L.T. 246 (Tri.- Bang.) wherein the Tribunal has remitted the matter to the adjudicating authority for recalculation of the duty liability payable by the assessee by taking into account the export obligation as already fulfilled and also effective rate of customs duty. While remanding the matter, in view of setting aside of the order of the adjudicating authority, the Tribunal has also set aside the penalty and interest levied on the Managing Director of the company. This order is called in question in this appeal.

Though the matter is admitted to consider the following substantial questions of law,

Whether non-fulfillment of the export obligation under Notification 160/92 [Cus] dated 20-4-92 even partially would entitle the licence holder immunity from payment of interest, levy of fine and imposition of penalty?

Whether Section 22 of Sick Industrial Companies [Special Provisions] Act, 1985 [SICA] would give immunity to the licence holder from nonpayment of the duty, fine or penalty in the case of admitted violation of the licence conditions viz. non-fulfillment of export obligation?

Whether the adjudicating authority was correct in applying the tariff duty at the rate of 65% or the rate of duty was leviable at the rate of 25% on the ground that Notification No. 61/94, dated 1-3-94 would be the effective rate of duty?

the respondent''s Counsel contends that the appeal itself is not maintainable in view of Section 130E of the Customs Act, 1962 for short ''the Act''. According to him, in view of Section 130E(b) of the Act, if the revenue is aggrieved by the order of the Tribunal the revenue has to file an appeal before the Hon''ble Supreme Court since the dispute is in relation to the rate of duty leviable on the assessee in view of two different notifications.

The learned Counsel for the revenue contends that the main grievance of the revenue before this Court is in regard to setting aside the interest and penalty levied by the adjudicating authority on the assessee.

If the dispute is only with regard to setting aside the rate of interest and penalty, we are of the view that when an order is passed by the Tribunal setting aside the original order and remanding the matter to the adjudicating authority, as a consequence, any interest or penalty levied by the original authority is also required to be set aside. After remand if the adjudicating authority passes any order, in such event, it is always open for the adjudicating authority to levy interest and penalty if it is entitled to levy interest and penalty on account of any violations of the Act.

Therefore, we are of the view that there is no necessity for this Court to entertain the appeal as dispute is in regard to the rate of duty.

Accordingly, the appeal is dismissed as not maintainable with the above observation without answering the substantial questions of law.