2009 (8) TMI 77 - HC - Customs

Duty free clearance exemption notification no. 204/92 dated 19.5.1992 - . The petitioners goods arrived in the territorial waters of India at least on 18th November 1993. The petitioner was denied the benefit of the said notification on the ground that the notification dated 25th November 1993 was issued before the goods were cleared for home consumption. By that notification, the goods were deleted from exemption. The Petitioner had filed the Bill of Entry for home consumption in respect of the said goods on 26.11.1998. Held that - The petitioner admittedly had a license issued much earlier. Once that be the case, the petitioner was entitled to the benefit under notification no.204/92 as amended subject to the petitioner satisfying the requirements of the other two provisos introduced in condition nos.7 and 8 if need be. Matter remitted to verify that the petitioner has complied with the other conditions.

Summary

Issues:
Challenge to arbitrary and illegal action of respondents in denying duty-free clearance under customs exemption Notification No.204/92 dated 19th May 1992.

Analysis:
The petitioners, supporting manufacturers/exporters of industrial dyes, challenged the respondents' action of not allowing duty-free clearance of goods under customs exemption Notification No.204/92 dated 19th May 1992, specifically related to the import of Acetic Anhydride. The petitioners contended that their goods arrived in India before the notification that withdrew the exemption was issued. The respondents argued that the exemption was withdrawn before the goods were cleared for home consumption. The petitioners held Duty Exemption Entitlement Certificates and an Advance Licence, which entitled them to import goods without paying customs duty, subject to fulfilling certain export obligations. The Advance Licence issued to the petitioners was quantity-based, allowing them to import Acetic Anhydride under the conditions of the notifications. The government issued notifications amending the exemption, leading to a dispute regarding the eligibility of the petitioners for the exemption.

The court considered the notifications issued by the government and the submissions made by both parties. The petitioners relied on a judgment of the Andhra Pradesh High Court in a similar case to support their claim for the benefit of a subsequent notification. The court analyzed the amendments made to the original notification and the subsequent notifications issued by the government. The court observed that the petitioners were entitled to the benefit under Notification No.204/92 as amended, provided they satisfied the requirements of the amended provisions. The court directed the respondent to decide whether the petitioners had complied with the requirements of the notifications and were entitled to the exemption under Notification No.204/92. If the respondent concluded that the petitioners met the requisites and were eligible for the exemption, the bank guarantee furnished by the petitioners was to be returned and canceled. The court ordered the respondent to complete the decision-making process within 12 weeks from the receipt of the court's order.

In conclusion, the court partially allowed the petition, directing the respondent to assess the petitioners' compliance with the notification requirements and determine their eligibility for the exemption under Notification No.204/92. If found eligible, the bank guarantee was to be returned, and the decision-making process was to be completed within a specified timeframe.