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2021 (12) TMI 1113 - AT - CustomsExemption from levy of Integrated Goods Service Tax - re-import of parts/engines of aircraft sent outside the country for repair - effect of notification no. 36/2021-Customs dated 19 th July 2021 and no. 37/2021-Customs dated 19th July 2021 substituting Said duty, tax or cess for Duty of customs - HELD THAT - The issue has been decided in the case of JET AIRWAYS (INDIA) LTD. VERSUS COMMISSIONER OF CUSTOMS 2021 (1) TMI 577 - CESTAT NEW DELHI where it was held that Appellant is thus entitled to exemption from payment of integrated tax under the Exemption Notification on reimport of repaired parts/ aircrafts into India. Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Applicability of exemption notifications (No. 45/2017-Cus and No. 46/2017-Cus) to Integrated Goods & Service Tax (IGST) on re-imported aircraft parts/engines. 2. Interpretation of "duty of customs" in the context of these notifications. 3. Retrospective application of clarifications in notifications No. 36/2021-Customs and No. 37/2021-Customs. 4. Legal precedents and binding nature of previous Tribunal decisions. Issue-wise Detailed Analysis: 1. Applicability of Exemption Notifications to IGST: The core issue revolves around whether the exemptions provided by notifications No. 45/2017-Cus and No. 46/2017-Cus apply to IGST levied under section 3(7) of the Customs Tariff Act, 1975. The appellant, M/s Jet Airways India Limited, argued that the exemptions should cover IGST on the value exceeding the fair cost of repairs, including materials, insurance, and freight. The appellant had been assessed to a duty of ?56,39,37,439 under protest and sought relief through appellate remedies. The Tribunal found that the exemptions in these notifications did not explicitly mention IGST, implying that IGST was wholly exempted for the re-imported goods. 2. Interpretation of "Duty of Customs": The Tribunal examined the definition of "duty" in section 2(15) of the Customs Act, 1962, and its application in conjunction with section 12 of the same Act. It concluded that "duty of customs" refers only to the duty leviable under the Customs Act and does not include additional duties such as IGST. The Tribunal relied on several legal precedents, including the Supreme Court's decision in Prestige Engineering (India) Limited vs. Collector of C., Excise, Meerut, which emphasized that the expression "duty of customs" should be understood as defined in the Customs Act and not expanded to include other taxes or duties. 3. Retrospective Application of Clarifications: The appellant contended that the retrospective application of clarifications in notifications No. 36/2021-Customs and No. 37/2021-Customs was beyond the jurisdiction, as section 25 of the Customs Act, 1962, restricts retrospective clarifications to one year from the original notification date. The Tribunal did not find it necessary to delve deeply into this contention, as it resolved the primary issue based on the interpretation of "duty of customs." 4. Legal Precedents and Binding Nature of Previous Tribunal Decisions: The Tribunal noted that the issue had been previously resolved in favor of the appellant in an identical case (Jet Airways (India) Ltd v. Commissioner of Customs, Air Cargo Commissionerate, New Delhi). The Tribunal found that the previous decision, which distinguished the intent of the exemption notifications and concluded that IGST was not included in the "duty of customs," was applicable to the present case. The Tribunal also referenced other relevant judgments, such as the Bombay High Court's decision in Ceat Tyres of India Limited vs. Union of India and the Supreme Court's decision in M/s Unicorn Industries vs. Union of India & Others, to support its conclusion. Conclusion: The Tribunal set aside the impugned order and allowed the appeals, concluding that the exemptions provided by notifications No. 45/2017-Cus and No. 46/2017-Cus did not include IGST. Therefore, the re-imported aircraft parts/engines were exempt from IGST, and only the basic customs duty on the fair cost of repairs, freight, and insurance charges was payable. (Order pronounced in the open court on 21/12/2021)
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