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Issues:
Grant of drawback on export item, interpretation of Customs Act provisions, jurisdiction of the Tribunal, criteria for determining garment composition. Analysis: The appeal challenged the rejection of drawback claim on export items by the Additional Collector of Customs, citing contravention of Customs Act provisions. The issue pertained to whether the garments qualified for drawback under the Customs and Central Excise Duties Drawback Rules, 1971. The appellants declared the export item as Rayon garments but were found to have plastic sequins embedded, leading to a dispute over the composition of the garments and the admissibility of drawback. The jurisdiction of the Tribunal was invoked as the appeal was against the Order-in-Original of the Additional Collector. Both parties agreed that the Tribunal had jurisdiction to decide the matter, leading to the hearing and disposal of the appeal. The appellants maintained that the garments were primarily Rayon, emphasizing the role of plastic sequins as mere embellishments. They presented expert opinions supporting their claim, arguing against the denial of drawback and the imposed penalties. The Respondent supported the rejection of the claim, contending that the scheme for duty drawback required strict interpretation and that plastic embellishments did not fall within the category of textile materials specified for drawback. The Respondent highlighted the predominance of plastic over Rayon in the garments, asserting that the claim was rightly rejected due to non-alignment with the Drawback Rules. Upon review of the evidence and arguments, the Tribunal analyzed the relevant provisions of the Drawback Rules, particularly Entry No. 27, which encompassed articles chiefly made from textile materials. The Tribunal scrutinized the use of the term "chiefly" in the entry and emphasized the absence of specific criteria for interpretation. It questioned the reliance on weight as the determining factor, noting that embellishments do not alter the fundamental fabric composition of garments. The Tribunal interpreted Sub-serial No. 2707, which covered readymade garments predominantly made of woven fabrics, to include the subject Rayon garments with plastic sequins. It concluded that the garments fell within the ambit of the Drawback Rules and were eligible for the claimed drawback. The Tribunal set aside the authority's order, directing the Department to pay the appropriate drawback and provide consequential reliefs to the Appellants.
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