2006 (3) TMI 473 - AT - Customs

EPCG scheme - Departmental clarification - Adjudication - EXIM Policy - Licence - Policy matters

Summary

Issues:
1. Interpretation of EPCG Licence validity with respect to Customs duty payment and clearance date.
2. Applicability of concessional duty under Notification No. 49/2000-Cus. to goods shipped before the duty came into effect.
3. Authority of DGFT in issuing and determining the validity of licenses.
4. Binding effect of Ministry's instructions on quasi-judicial authorities like Commissioner (Appeals).

Analysis:
1. The appeal concerned the validity of an EPCG Licence issued by DGFT and its relation to Customs duty payment and goods clearance date. The license was endorsed to be valid for goods already shipped but not cleared from Customs, indicating a specific condition for its applicability.

2. The issue revolved around the applicability of concessional duty under Notification No. 49/2000-Cus. to goods shipped before the duty's effective date. The Revenue contended that the concessional rate was not applicable to goods shipped prior to the duty coming into effect on 1-4-2000.

3. The authority of DGFT in issuing licenses and determining their validity was a crucial aspect of the case. The Tribunal emphasized that in matters of licenses issued under the EXIM Policy, DGFT holds the final authority, and customs authorities cannot question the validity of licenses issued by DGFT.

4. The binding effect of Ministry's instructions on quasi-judicial authorities like Commissioner (Appeals) was also a key point of contention. The Tribunal highlighted that the Commissioner (Appeals) is not bound by inter-departmental communications and must rely on legal provisions and established principles.

5. The Tribunal upheld the impugned order, emphasizing that the EPCG License's validity was correctly interpreted based on the date of shipment and the prevailing Customs duty notification. It was established that the Commissioner (Appeals) correctly applied legal principles and upheld the authority of DGFT in license matters, dismissing the Revenue's appeal on grounds of lack of merit.