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Issues involved:
The issues involved in the judgment include the applicability of exemption Notification No. 116/88 to imported goods, the examination and composition of goods exported, the denial of right of cross-examination, fulfillment of export obligations under the DEEC scheme, and the dispute regarding the composition of exported goods. Applicability of Exemption Notification: The Addl. Collector held that since the export goods were not manufactured out of 100% acrylic fiber, the benefit of exemption Notification No. 116/88 did not apply, leading to a demand for import duty and imposition of a penalty on the appellants. Examination and Composition of Exported Goods: The goods declared for export as 100% acrylic fiber were found upon examination to be made from old and used synthetic rags, some woolen rags, and blended spun yarn of acrylic and wool fiber. Reports from the Dy. Chief Chemist and SASMIRA indicated variations in the composition, suggesting the use of old fibers. Despite requests for cross-examination being denied, the Collector upheld the findings based on visual examination. Fulfillment of Export Obligations: The appellants, being regular exporters, had fulfilled their export obligations under the DEEC scheme, receiving foreign exchange and meeting quantity and quality requirements. The denial of cross-examination was argued to breach principles of natural justice, with reference to relevant licensing conditions and previous adjudication orders supporting the appellants' compliance. Dispute over Composition of Exported Goods: The Dy. Chief Chemist and SASMIRA reports indicated the use of old and blended fibers in the exported goods, contrary to the requirement of exporting 100% acrylic fiber under the DEEC scheme. The authorities contended that duty exemption was incorrectly availed, leading to the demand for duty payment. The order of the Addl. Chief Controller of Imports and Exports, discharging the appellants from allegations, was argued to be inapplicable to the Customs Department's duty assessment. Judgment: The Tribunal noted that the Textile Committee certified the goods as 100% acrylic fiber, with the question of whether the fiber was fresh or blended not being crucial. Reports were based on visual examination without chemical tests, leading to inconclusive findings. Given the certification by the Textile Committee and fulfillment of export obligations, the demand for duty and penalty was deemed unnecessary. The appeal was allowed, with any consequential relief to be granted as per the law.
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