2019 (3) TMI 1445 - AT - Customs

Goods imported from South Asian Association for Regional Co-operation SAARC countries - Benefit of N/N. 105/99-Cus. - benefit of notification denied on the ground of non-fulfillment of Origin criteria - Held that - Division Bench of the High Court of Kerala, in the case of Director-General of Foreign Trade, New Delhi Vs M/s. Mustafa Traders 2016 (9) TMI 669 - KERALA HIGH COURT , has reiterated that DGFT had jurisdiction to issue notification under section 5 of the FTDR Act. Percentage content in respect of non-origin material - percentage raised to 70% by Notification No.73/1995 (NT), dated 07.12.1995 - Held that - As per II (b)(3) of the Schedule to the Customs Notification No73/1995 (NT), dated 07.12.1995 when the importer is claiming Special Origin Criteria under para 10 of the said Schedule in the box 8 of the Country of Origin Certificate letter D should be entered. Whereas, the Country of Origin Certificate submitted by the importer shows Origin Criteria as B 65.83%. Therefore, the subject goods are not fulfilling the Origin Criteria as prescribed in the said notification and hence not eligible for the benefit of Customs Notification No.105/1999-Cus. Appeal dismissed - decided against appellant.

Summary

Issues:
1. Eligibility for availing Free Trade Agreement (FTA) notification benefit under Customs Notification No.105/99-Cus.
2. Interpretation of Origin Criteria in the Country of Origin Certificate for imported goods.

Issue 1: Eligibility for availing FTA notification benefit:
The appellant filed a bill of entry for Betel Nuts from Bangladesh under CTH 08029019, claiming benefit under FTA notification No.105/99-Cus. The original authority rejected the claim, citing a discrepancy in the Country of Origin Certificate. The Commissioner (Appeals) upheld this decision. The appellant argued based on a High Court judgment regarding tariff values and the percentage content of non-origin material from non-contracting parties. The Revenue representative opposed, emphasizing the percentage limit of non-contracting party materials. The Tribunal analyzed the FTA notification, amendments, and relevant judgments. They found the appellant's arguments insufficient and upheld the original authority's decision, dismissing the appeal.

Issue 2: Interpretation of Origin Criteria in Country of Origin Certificate:
The appellant contended that the percentage content of non-origin material was raised to 70% by a Customs Notification. However, the Country of Origin Certificate submitted by the appellant did not match the required Origin Criteria specified in the notification. The Tribunal concurred with the Lower Appellate Authority's analysis, stating that the goods did not fulfill the prescribed Origin Criteria and were thus ineligible for the FTA benefit. The appeal was dismissed based on this finding.

In conclusion, the Tribunal upheld the original authority's decision, denying the appellant the benefit of the FTA notification due to discrepancies in the Country of Origin Certificate. The judgment provided a detailed analysis of the relevant notifications, amendments, and legal precedents, ultimately ruling against the appellant's claims.