2006 (9) TMI 29 - AT - Customs

EXIM- DFRC- Fabric with 55% cotton and 45% polyster are not classified under Processed cotton fabric as per DGFT- Benefit of DFRC not avail to him.

Summary

Issues: Interpretation of DFRC scheme for duty exemption on imported goods under Exim Policy and Notification No. 48/2000-Cus.

In this case, the importer claimed exemption from Customs duty under the DFRC scheme for importing goods declared as "Processed Cotton Fabrics." The issue arose when there was a doubt whether the imported goods should be 100% cotton fabrics or processed fabrics with a specific cotton content. The matter was referred to the DGFT, whose decision was final and binding as per the Exim Policy. The DGFT clarified that the imported goods did not meet the technical characteristics required for duty-free import under Notification No. 48/2000-Cus. The imported goods consisted of 55% cotton and 45% polyester, while the export items were described as Cotton Processed made-ups. The Tribunal emphasized the importance of adhering to the DGFT's interpretation of the policy, citing a previous Apex Court decision. The Tribunal also noted that a clarificatory Public Notice issued by the DGFT had retrospective effect, contrary to the lower appellate authority's understanding. Consequently, the Tribunal set aside the lower order and allowed the importer's appeal, emphasizing the significance of complying with the DGFT's decisions in such matters.