2020 (4) TMI 159 - HC - Customs

Export Promotion Capital Goods Scheme - failure to fulfill export obligation - HELD THAT - Considering the limited nature of the relief now sought for by the learned counsel for the petitioner, which has been countenanced by the learned Standing Counsel appearing for the respondent, this Court permits the petitioner to submit the required redemption certificate to the respondent within a period of two weeks from the date of receipt of a copy of this order. On receipt of the same, the respondent shall consider the same and pass appropriate orders, in accordance with law, after affording an opportunity of personal hearing to the petitioner, within a period of four weeks thereafter. Petition disposed off.

Summary

Issues:
1. Failure to fulfill export obligation under Export Promotion Capital Goods Scheme.
2. Demand of customs duty and interest by the respondent.
3. Detention and sale of goods belonging to the petitioner.
4. Relief sought by the petitioner in the writ petitions.

Analysis:

Issue 1: Failure to fulfill export obligation under Export Promotion Capital Goods Scheme
The petitioner, engaged in the manufacture and export of garments, imported capital goods under the Export Promotion Capital Goods Scheme. The petitioner was required to meet the export obligation within a stipulated time frame, failing which they would be liable to pay the duty leviable on demand. Despite the expiry of the prescribed period, the petitioner did not produce the Export Obligation Discharge Certificate, leading to the respondent issuing a notice demanding customs duty with interest.

Issue 2: Demand of customs duty and interest by the respondent
The respondent, after due enquiry, passed an Order-in-Original directing the petitioner to pay a specific duty amount along with applicable interest. Subsequently, when the petitioner failed to comply with the payment as per the order, the respondent issued a notice detaining and selling the petitioner's goods across India. This action was challenged by the petitioner through the writ petitions.

Issue 3: Detention and sale of goods belonging to the petitioner
In response to the petitioner's challenge, during the court proceedings, the petitioner sought permission to submit a redemption certificate to the respondent. The petitioner's request for submitting the redemption certificate was limited in nature, and both parties agreed to this course of action. The Court, considering the agreed-upon relief sought by the petitioner, permitted them to submit the redemption certificate within two weeks. Upon receipt, the respondent was directed to review the certificate, hold a personal hearing with the petitioner, and pass appropriate orders within four weeks.

Issue 4: Relief sought by the petitioner in the writ petitions
The Court disposed of the writ petitions with the directions provided regarding the submission of the redemption certificate and the subsequent review process by the respondent. No costs were awarded, and connected miscellaneous petitions were closed as a result of the judgment.