2002 (7) TMI 493 - AT - Customs

Summary

Issues: Interpretation of manufacturing permission for 100% EOU, classification of imported goods under Customs Tariff Heading 3004.90, denial of benefit of notification, imposition of penalty, permission for re-export.

Interpretation of Manufacturing Permission:
The appellants, a 100% EOU, were granted permission to manufacture specific items but were restricted from manufacturing certain products. The permission was later amended to include additional items under Heading 3004.90. The issue arose when the Customs authorities sought to confiscate imported Boflavin feed grade 96% Vitamin B-2, claiming it did not qualify under Heading 3004.90. The Commissioner denied the benefit of a notification, confiscated the goods, and imposed a penalty, leading to the appeal. The Tribunal found that the Commissioner erred in interpreting the amendment, clarifying that the importers were allowed to manufacture products under Heading 3004.90 in addition to other categories.

Classification of Imported Goods:
The Customs authorities contended that the imported goods did not qualify under Heading 3004.90, leading to the confiscation and penalty. The Commissioner's view was that the goods could not be used for drugs under Heading 300490.72, and the end-product did not fall under the same heading. However, the Tribunal disagreed, emphasizing that the importers were permitted to manufacture items under Heading 3004.90 along with other categories. This clarification led to the appeal being allowed, setting aside the impugned order.

Denial of Benefit of Notification and Penalty Imposition:
The Commissioner denied the benefit of a notification, confiscated the imported goods, and imposed a penalty, based on the belief that the goods did not align with the permitted manufacturing activities. However, the Tribunal found that the import of vitamins was in accordance with the granted license, highlighting the error in the Commissioner's interpretation. As a result, the appeal was allowed, and the impugned order was overturned, providing appropriate relief as per the law.

Permission for Re-Export:
The importers had requested permission for re-export of the goods, which was denied by the Commissioner along with the denial of the benefit of the notification and imposition of penalties. However, the Tribunal's decision to allow the appeal and set aside the impugned order implied that the import of the vitamins was within the scope of the granted license, ultimately leading to the importers being entitled to appropriate relief as per the law.