2021 (3) TMI 1079 - HC - Customs

Production of installation certificate of the goods imported free of duty under the Project Import Regulations, 1986 - directory or mandatory direction - production of sale invoices for having sold the computerized PCB in-circuit Tester for test bench for Ticket Office Machines - discharge of the obligation to produce the proof of installation or not - failure to clear the validator imported vide Bill of Entry No.5668 dated 24.10.2009 - charging of ware house interest for the uncleared goods - levy/charge of interest under Section 61 of the Customs Act, 1962 (delayed clearance of goods from warehouse) - HELD THAT - Bangalore Tribunal in the case of CREATIVE INDUSTRIES P. LTD. VERSUS CC. C. EX. (A-II), HYDERABAD 2008 (6) TMI 23 - CESTAT BANGALORE , wherein it was held that non-production of installation certificate is only a procedural requirement and not a condition determining the eligibility of the impugned goods for the benefit of concessional rate of assessment. The Tribunal further noted that the said decision was affirmed by the High Court Of Andhra Pradesh as reported in CCE. C., HYDERABAD VERSUS CREATIVE INDUS. (RAJAHMUNDRY) P. LTD. 2012 (10) TMI 646 - ANDHRA PRADESH HIGH COURT . The Tribunal also referred to the decision of the other Tribunal which also held that the installation certificate is only a procedural requirement. The Tribunal after considering the documents placed, was satisfied that the assessee has produced proof to establish installations and therefore, it was held that the Department cannot sustain the demand of merit rate of duty in respect of goods imported vide Bill of Entry No.5219 dated 25.01.1989. For such reasons, the assessee succeeded before the Tribunal. The appeal is dismissed as no substantial questions of law arises for consideration.

Summary

Issues:
1. Compliance with project import regulations and entitlement to benefits.
2. Justification for demanding duty and interest from the assessee.
3. Denial of remission of duty and duty demand sustainability.

Compliance with Project Import Regulations and Entitlement to Benefits:
The appeals were filed challenging a Customs, Excise and Service Tax Appellate Tribunal order. The substantial questions of law included the necessity of an "installation" certificate for duty-free imports under Project Import Regulations, 1986, and the obligation to produce proof of installation. The Tribunal held that the installation certificate was procedural, not mandatory for concessional assessment. It also noted the importer's proof of installation, leading to the rejection of the revenue's demand for merit rate duty. The High Court upheld the Tribunal's decision, emphasizing that factual findings should not be re-evaluated unless utterly perverse.

Justification for Demanding Duty and Interest:
The revenue contested the Tribunal's findings on compliance and interest liability. The Tribunal ruled that interest could not be demanded pre-1995, based on the Finance Act, 1995. The High Court clarified that the interest demand was separate from duty demand, not under section 28(2) of the Act. The Tribunal's observation on interest under section 28AA was deemed irrelevant as it was not raised earlier. The appeal by the revenue was dismissed, leaving substantial questions open for future consideration.

Denial of Remission of Duty and Duty Demand Sustainability:
The assessee disputed duty demand for uncleared goods, initially claiming non-filing of a bill of entry. However, conflicting stances were taken later, leading to a rejection by the Tribunal. The Tribunal found the assessee's contentions untenable, emphasizing the filing of a double duty bond and bill of entry. The High Court upheld the Tribunal's decision, dismissing the assessee's appeal and favoring the revenue. Both appeals were dismissed, with no costs awarded, and connected petitions were closed.