2016 (8) TMI 799 - AT - Customs

Demand - denial of benefit of exemption notification - Notification No. 21/2002 dated 1.3.2002 - export of handicraft item - wooden furniture - certificate wrongly obtained from Export Promotion Council for Handicraft (EPCH)- Held that - EPCH which is a sponsored organisation under the Ministry of Textile, Government of India, upon verification of the records maintained by the appellant, has certified inter alia, that handicraft goods have been exported by the appellant on due compliance of the conditions contained in the Notification No. 21/2002 dated 1.3.2002. Further, the CA also certified the fact that the appellant had exported handicraft goods during the period 1.4.2003 to 31.3.2004 for FOB value of 2,77,89,234/-. Since the condition of the notification have been substantially complied with by the appellant and the competent authority has certified the said aspect, the custom department cannot question the genuineness or authenticity of such certificates - appeal allowed - decided in favor of appellant.

Summary

Issues:
Denial of duty exemption under Notification No. 21/2002 on the grounds of goods exported not being handicraft items and certificate authenticity questioned by Customs department.

Analysis:
The appellant, engaged in manufacturing and exporting handicraft furniture, imported polishing materials for manufacturing, claiming duty exemption under Notification No. 21/2002. Customs department denied the exemption, stating the goods exported were wooden furniture, not handicraft items, and the certificate from Export Promotion Council for Handicraft (EPCH) was wrongly obtained. The Commissioner (Appeals) upheld the duty demand, leading to the appeal. The appellant argued compliance with notification conditions, citing EPCH and CA certificates. The Revenue supported the denial based on a Supreme Court judgment. The Tribunal noted EPCH certification of export compliance and CA certification of handicraft goods export, concluding the Customs department cannot question certificate authenticity. The Tribunal distinguished the cited Supreme Court case, as it pertained to a different notification. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant.