2003 (9) TMI 510 - AT - Customs

Summary

Issues:
1. Waiver of pre-deposit of duty in a customs case involving Di-ammonium phosphate (DAP) import.
2. Interpretation of Notification 36/96-Cus. and Notification No. 11/97-Cus. regarding exemption from customs duty for DAP used as manure or in fertilizer production.
3. Acceptability of end use certificate issued by the M.P. State Co-operative Marketing Federation Limited.
4. Requirement of end use certificate as per the relevant Notification and its implications on duty exemption.

Analysis:
1. The case involved an application for waiver of pre-deposit of duty amounting to Rs. 61,37,280 arising from a customs dispute related to the import of Di-ammonium phosphate (DAP). The Commissioner of Customs (A) set aside the adjudication order of the Asstt. Commissioner, denying the benefit of exemption under Notification 36/96-Cus. and Notification No. 11/97-Cus. to the imported DAP due to the absence of a satisfactory end use certificate.

2. The Tribunal analyzed the relevant Notification provisions exempting DAP from customs duty when used as manure or for fertilizer production. It noted that the Notification did not explicitly require an end use certificate for availing the exemption. The applicants voluntarily provided an undertaking to submit an end use certificate confirming the designated use of the imported DAP. Although the certificate from the M.P. State Co-operative Marketing Federation Limited lacked specific details, the Tribunal found merit in the argument that the declaration on the Bill of Entry (Bs/E) should suffice in the absence of a specified authority for the end use certificate.

3. The Tribunal considered the lower Appellate Authority's rejection of the end use certificate based on its perceived deficiencies. However, it relied on precedent, citing the case of CCE, Ahmedabad v. Maize Products [1997 (94) E.L.T. 651 (Tri.)], which established that denial of exemption due to non-production of an end use certificate without a specific requirement in the Notification was unwarranted. Consequently, the Tribunal concluded that a strong prima facie case for waiver of pre-deposit of duty existed, leading to the dispensation of the duty requirement and a stay on recovery pending the appeal.

In conclusion, the judgment centered on the interpretation of customs duty exemption provisions for DAP imports, emphasizing the absence of a mandatory requirement for an end use certificate in the relevant Notifications. The Tribunal prioritized the fulfillment of the purpose outlined in the Bill of Entry over technical deficiencies in the end use certificate, ultimately granting the waiver of pre-deposit and halting duty recovery during the appeal process.