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Issues:
1. Confiscation of goods under Customs Act for mis-declaration. 2. Appeal against order of Collector of Customs, Madras. 3. Import of Polyvinyl Alcohol (PVA) claimed as Binder (Resin). 4. Redemption fine and penalty imposed by lower authority. 5. Applicability of Notification No. 159/60/90/CE for duty exemption. 6. Stay application for clearance of goods under Advance Licence scheme. 7. Use of PVA as binder in leather industry. 8. Verification of goods usage for export obligations. 9. Quantity of imported goods for leather manufacturing. 10. Interpretation of licensing authorities' approval for goods importation. Analysis: The appeal before the Appellate Tribunal CEGAT, Madras involved the confiscation of goods under the Customs Act due to mis-declaration by the appellant. The lower authority had confiscated Polyvinyl Alcohol (PVA) claimed as Binder (Resin) under an Advance Licence, denying duty exemption under Notification No. 159/60/90/CE. The goods valued at Rs. 13,39,145/- were allowed redemption on payment of a fine and penalty. The appellant filed a stay application for clearance, emphasizing the goods' intended use for export obligations in the leather industry. During the hearing, the appellant argued that the imported goods were indeed PVA Resin for use as a binder in leather finishing, supported by chemical analysis and industry references. The appellant contended that the goods were correctly described in the Bill of Entry and met the licensing requirements for duty-free importation. The Department, while acknowledging the potential use of the material as a binder, raised concerns about the quantity imported for leather manufacturing. The Tribunal noted that the goods were imported to fulfill export obligations under the Advance Licensing Scheme as Binder (Resin), confirmed by chemical analysis and industry references. Despite the Department's reliance on an older report, it was established that the goods were intended for leather manufacturing. The Tribunal emphasized that the appellant had provided full disclosure and held the goods as described in the licence, warranting duty exemption under the notification. In its decision, the Tribunal allowed the appeal, setting aside the lower authority's order. The appellant was directed to execute a bond for the duty leviable on the goods and maintain records for Customs verification during the manufacturing process. This decision aimed to balance revenue interests and the appellant's compliance with Customs requirements, ensuring the goods' legitimate use as Binder (Resin) for leather manufacturing.
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