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Issues: Validity of import license, interpretation of Public Notice 53/78, compliance with licensing conditions
The judgment by the Appellate Tribunal CEGAT, Bombay involved a case where M/s. Gujarat Machinery Manufacturers Ltd. imported Hydrogen Compressors with Motors and spares but faced objections during customs clearance. The main issues revolved around the validity of the import license, the interpretation of Public Notice 53/78, and compliance with licensing conditions. The undisputed facts revealed that the customs objected to the clearance of the compressors, claiming they were capital goods and not components of a Hydrogen Gas generating plant. The Collector of Customs ordered confiscation of the goods but allowed redemption on payment of a fine. The Board disagreed with the Collector's findings regarding the timing of the letter of credit and the public notice. The Board upheld the confiscation but reduced the fine. Subsequently, the appellants filed a revision application, which was treated as an appeal. During the appeal hearing, the appellant's representative argued that the import license was valid for items in Appendix 5 of A.M. 79 and that the compressors could be imported as components under the policy. On the other hand, the Departmental Representative contended that the import was impermissible as the compressors were not components for the intended use and the license was invalid due to the amended policy. The central question was whether the Collector and the Board erred in deeming the license invalid for the import. The judgment analyzed the license, policy provisions, Public Notice 53/78, and Trade Notice to determine the license's validity. The judgment highlighted that amendments made after the license issuance were not applicable unless specified. Referring to a Supreme Court decision, the judgment emphasized that Public Notice 53/78 did not have retrospective effect and could not govern licenses issued before its publication. Consequently, the Tribunal found the Collector and Board's decision erroneous and set aside the confiscation orders. The matter was remanded to the Collector of Customs for further examination of compliance with licensing terms. In conclusion, the appeal was allowed, and the confiscation orders, as well as fines, were annulled, with the case remanded for fresh consideration in line with the Tribunal's observations.
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