2010 (9) TMI 465 - AT - Customs

Demand - There is no dispute that the said goods had reached the factory premises and were destroyed by fire due to short circuit - As the issue in this case is regarding the benefit of Notification No. 32/97 - The first condition of Condition No. (iii) of the notification is not fulfilled by the appellant as the raw material which were destroyed during the fire, could not be utilized only for discharge of export obligation - Demand confirmed - decided against the assessee.

Summary

Issues:
Whether duty foregone on imported raw materials destroyed in fire is payable under Notification No. 32/97-Cus.

Analysis:
The appeal concerned the duty foregone on raw materials imported under Notification No. 32/97-Cus., destroyed in a fire at the factory premises. The appellant contended that the goods were imported for job work and re-export, meeting the conditions of the notification. The appellant argued that the destroyed goods were intended for an export order and cited relevant case law to support their position. The Department argued that the notification required goods to be used for export obligation discharge strictly. The Tribunal analyzed the notification's conditions, emphasizing the requirement for goods' utilization solely for export obligation discharge. Since the destroyed goods did not fulfill this condition, the Tribunal upheld the lower authorities' decision.

The Tribunal examined the appellant's reliance on case law, noting the distinction in the wordings of the notifications. While the cases cited by the appellant related to goods' use for manufacturing, the current case required goods to be utilized for export obligation discharge specifically. The Tribunal found that the conditions of Notification No. 32/97-Cus. were not met in the appellant's case, aligning with the Department's interpretation. Consequently, the judgments cited by the Department favored the appellant's position, leading to the rejection of the appeal.

In conclusion, the Tribunal upheld the lower authorities' decision, emphasizing the necessity to comply strictly with the conditions of Notification No. 32/97-Cus. The appellant failed to demonstrate that the destroyed raw materials were utilized solely for export obligation discharge, leading to the dismissal of the appeal. The Tribunal found the orders passed by the lower authorities to be legally sound and free from any defects, resulting in the rejection of the appeal.