2007 (3) TMI 610 - AT - Customs

Summary

Issues:
1. Denial of benefit under Notification No. 21/02 due to procedural lapse.

Analysis:
The appeal in question stemmed from the denial of the benefit under Notification No. 21/02 to the assessee based on a procedural oversight. The revenue contended that the terms of the Notification had not been adhered to, thus justifying the denial. However, the appellant argued that the failure to claim the benefit was merely a procedural lapse and should not result in the denial of substantial benefits. The appellant had imported spare parts for machinery in the Textile Industry, paid the duty at tariff rates, and later sought the benefit of a 5% duty reduction under the Notification. Despite their realization and subsequent claim, the refund was rejected on procedural grounds.

In a similar case involving M/s. Ramsons Garments Finishing Equipment Pvt. Ltd., the Bench had ruled that the concessional duty rate could not be denied for machinery or equipment imported for the Textile Industry as specified in the relevant list appended to the Notification. The appellant's counsel emphasized that since the spare parts were indeed intended for use in the Textile Industry, the denial of benefits solely on procedural grounds was unjustifiable. The learned DR, however, contended that strict adherence to the procedure outlined in the Notification was necessary, highlighting the failure to make a timely claim at the time of filing the Bill of Entry.

Upon considering the arguments presented, the Tribunal found that the procedure prescribed in the Notification pertained to the installation and use of spare parts in the textile industry. The appellant successfully demonstrated that the spare parts had been utilized in the textile industry, warranting a closer examination of the evidence by the revenue authorities. The Tribunal held that denying substantial benefits due to procedural lapses was unwarranted, especially when the spare parts were indeed used for textile machinery. Citing the precedent set in the case of M/s. Ramsons Garments Finishing Equipment Pvt. Ltd., where a similar issue was resolved in favor of the assessee, the Tribunal concluded that the appellants were entitled to the benefits under the Notification both on merit and in accordance with the aforementioned judgment. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief.