2015 (2) TMI 29 - HC - Customs

Clearance of crude oil - whether the Crude Palm Oil imported by the appellant can be cleared availing exemption under Notification No. 12/2012, dated 17-3-2012 - Held that - As the respondent-company has been found eligible on facts to claim exemption benefit under the department s own Notification No. 12/2012 and as the regulations require that product should be edible palm oil and therefore imported variety requires refining, we called upon the respondent-company to submit an undertaking to that effect. Today, Sri S. Ravi, learned senior counsel appearing for the respondent-company, placed before us the signed undertaking dated 21-4-2014, whereby Sushil Goenka, a Director of the respondent-company, undertook that the company would not release the detained imported crude palm oil without refining the same conforming to contents as per notification making it fit for human consumption. This refining is proposed to be undertaken at the respondent-company's factory located at Krishnapatnam Port area, Pantapalem Village, Muthukur Mandal, SPSR Nellore District, where the oil has been warehoused and is presently detained. The respondent-company further confirmed that it would allow access to the officials of the Customs department to supervise and inspect the process so as to ensure compliance with the requirement of refining. - No question of law arises - Decided against Revenue.

Summary

Issues:
- Appeal against the order granting exemption under Notification No. 12/2012
- Reliance on judgments of High Courts of Gujarat and Kolkata
- Dispute over Circulars issued by the Government of India
- Requirement of refining imported palm oil for human consumption
- Undertaking by the respondent-company for refining process supervision and compliance

Analysis:
The appeal before the Andhra Pradesh High Court involved a challenge by the Commissioner of Customs, Central Excise, and Service Tax against the final order of the Customs, Excise, and Service Tax Appellate Tribunal. The Tribunal had ruled in favor of the respondent-company, granting them eligibility for exemption under Notification No. 12/2012. The High Court noted that the Tribunal had relied on judgments of the High Courts of Gujarat and Kolkata, which dealt with a similar notification, and the High Court concurred with the views expressed in those judgments, emphasizing that they had not been overturned.

The appellant sought to rely on Circulars issued by the Government of India regarding the clearance of consignments only after meeting all conditions. However, the High Court observed that the respondent-company had been found eligible for the exemption under the relevant notification. The regulations required the imported palm oil to be refined for human consumption, and the respondent-company submitted an undertaking to that effect. The undertaking confirmed that the imported crude palm oil would not be released without refining it to meet the standards specified in the notification. The refining process was to take place at the respondent-company's factory under the supervision of Customs officials to ensure compliance.

After considering the arguments and submissions, the High Court found no merit in the contentions raised by the appellant. It held that no question of law, especially a substantial one, arose for consideration. Consequently, the appeal was dismissed, subject to the respondent-company's compliance with the undertaking. The High Court made no order as to costs, bringing the matter to a conclusion.