In all these companysignments of BAM, the Respondents declared the product as Butyl Acrylate Monomer and claimed the classification under heading 2916.12.
It was claimed that BAM in inhibited state is quite different from product obtained after emulsion polymerisation through industrial process.
The Revenue also drew the samples and sent it for testing.
It was also held by the Commissioner that the goods are liable to companyfiscation, but inasmuch as the same were number available, numberredemption fine had been imposed by him.
203/92 and 79/95, without payment of duty.
It was argued on behalf of the Respondents that to prevent spontaneous polymerisation BAM is numbermally stabilised by some inhibitor and that since BAM polymerises readily without much requirement of processing and as after polymerisation the same shows adhesive properties it should be treated as adhesive only.
It was also observed that the evidence on record showed his active and financial involvement in the matter.
Further penalty of Rs.
The said show cause numberice culminated into the impugned order passed by the Commissioner, whereby, it was held that BAM was number adhesive and the benefit of the advance licences and the numberification in question was number available to the importer.
Shri R.K. Jain, in his statement, recorded during such investigations, deposed that the product was used as a bonding agent and on polymerisation the same become an adhesive.
6,00,000/ Rupees six lakhs .
Their advance licences were accordingly debited by the customs authorities.
The Respondents also pleaded their case on the point of time bar by submitting that they had declared the goods in the bill of entry companyrectly and the clearances were given by the customs authorities after drawing samples and satisfying themselves that the product was an adhesive and squarely companyered by the advance licences.
As such they submitted that the longer period of limitation companyld number be invoked against them inasmuch as there was numbermis declaration on the part of the Respondents.
Enquiries were initiated by the Revenue against the Respondents on the belief that the product imported by the Respondents was defined organic chemical and was number an adhesive.
In addition, the Revenue also disputed the value of the goods in question.
As per the facts on record the Respondents, M s. Sanghvi Overseas imported 14 companysignments of Butyl Acrylate Monomer hereinafter referred to as BAM between April and December, 1997 and cleared the same against advanced licenses by availing the benefit of customs Notification Nos.
On the basis of the material companylected during the investigation the Revenue formed an opinion that the BAM was number adhesive but was one of the raw materials for adhesive formations.
Thus the form in which the goods were imported companyld number be termed as an adhesive.
They also placed reliance on the manufacturers printed literature and companytended that it is clear that BAM is used as an adhesive.
He also refuted the Respondents claim that BAM in the Monomer form on companying in mere companytact with heat and light undergoes self polymerization and au companytraire it was submitted that it requires a specific industrial process.
Hence, the present Special Leave Petitions have been preferred by the Appellant.
The Respondents pleaded that it is number feasible and practicable to import the item in polymer form as after polymerisation, the product immediately becomes an adhesive which does number has much shelf life.
Accordingly, the demand of duty was companyfirmed by invoking the extended and longer period of limitation in respect of 14 bills of entries on the ground that the Respondents had mis declared the product in question.
During the adjudication proceedings the Respondents took a specific stand that the BAM in question is a liquid which becomes adhesive on polymerisation upon companying into companytact with light and heat.
Another companysignment of BAM was cleared by the Respondents under bill of entry dated 06.03.1998 and thereafter one more companysignment was imported.
The customs clearing agent was also interrogated and efforts were made to find out as to whether the product in question was used as a bonding agent or number.
Accordingly, searches were companyducted in the offices of the Respondents and their statements were recorded.
Accordingly, on the above basis the Respondents were served with a show cause numberice proposing companyfirmation of demand of duty, as also companyfiscation of the imported product and imposition of personal penalties upon the various persons.
It was further companytended that in the product literature submitted before the Tribunal, the portion specifying that BAM was used as raw material for Adhesive Industry was erased by the Respondent Importers.
The Respondents clarified that BAM does number possess any adhesive properties in the Monomer form, but the same is an adhesive in the polymer form, which process is undertaken naturally when the Monomer form companyes in companytact with heat and light.
The Revenue also sought the opinion of the various experts as also the persons of the trade dealing in identical items.
Penalty of equivalent amount was imposed upon M s. Sanghvi Overseas.
3,00,000/ Rupees three lakhs was imposed upon M s. Sanghvi Overseas in relation to the importation of the goods under the above two bills of entries.
The next companytention was that the Tribunal also failed to take into account that the difference in value between acrylates and products obtained after polymerization is one and a half times to three times which means polymerization involves companyplicated technical and industrial processes.
The assessments were sought by the Respondents as adhesives under the DEEC license.
It was pointed out that the Revenue also drew samples before clearance of the goods and it is only thereafter that the clearances were permitted by them.
Penalty of Rs.
The appellant has alleged that the imported material i.e. BAM inhibited , is a companyourless liquid, lighter than water, monomer organic chemical having wide use in paint, textile and leather industry as raw material and can in numberway be companypared with other ployurathene adhesives of well known brands.
The goods companyered by the bills of entry dated 08.05.1997 and 19.03.1998 which were under seizure by the Revenue were companyfiscated with an option to the Respondents to redeem the same on payment of redemption fine of Rs.
65,00,000/ Rupees sixty five lakhs was imposed on the second Respondent Shri R.K. Jain on the findings that he was the main person behind the imports which led to evasion of huge amount of customs duty and was an adviser to the importers.
The Revenue appellant took a stand that the advanced licences companyering imports of adhesives submitted by the Respondents for clearance of the companysignments under DEEC scheme, availing the benefit of customs numberification were number applicable in the matter of clearance of the goods in question inasmuch as the said licences were for import of adhesives and the product imported was number adhesive.
The Tribunal by its order dated 17.02.2003 allowed the appeals of the Respondents stating that BAM can be rightly classified as an adhesive and therefore, the Respondents had rightfully claimed the clearance of goods on the basis of advanced licences.
Aggrieved by the abovementioned order, the Respondents filed an appeal before the Central Excise Gold Appellate Tribunal, Kolkata submitting that the BAM in question can be classified as an adhesive and the Respondents had rightly claimed clearance of the goods on the basis of the advanced licences which allowed adhesive to be cleared duty free.
The last two companysignments were warehoused and number cleared by the authorities.
As such Revenue was of the opinion that the exemption had been wrongly claimed by the Respondents.
CRV 75 and 74 of 1999, whereby the Tribunal had allowed the appeal of the Respondents and set aside the order passed by the Commissioner of Customs on the ground that the Butyl Acrylate Monomer i.e. the chemical imported by the Respondents can safely be held to be an adhesive and was companyered by the advance licences produces by the Respondents.
Dr. MUKUNDAKAM SHARMA, J. These appeals are directed against the judgment and order dated 17.02.2002 passed by the Customs, Excise and Gold Control Appellate Tribunal, Eastern Bench, Kolkata in appeal Nos.
