2012 (11) TMI 877 - AT - Customs

Target Plus Scheme - Notification No. 32/2005-Cus., dated 8-4-2005 - denial the benefit of the Notification and recovering duty on the imported item on the ground that the imported item did not have any nexus with the exported goods Held that - Input-Output Norms referred to by the learned counsel indicate nexus between the item (Palmolein) and the exported goods (Rice, Wheat etc.) which are within the same product group (viz. Food Products) - product group is mentioned in the condition sheet attached to the authorization letter issued by the DGFT to the appellant for utilizing duty credit - appellant has made out a case for waiver of pre-deposit - pre deposit waived.

Summary

Issues:
1. Denial of benefit of Notification No. 32/2005-Cus. for imported RBD Palmolein under Target Plus Scheme.
2. Adjudged dues, waiver, and stay application.
3. Product-to-product nexus between imported and exported goods.
4. Validity of Board's Circular No. 21/2007-Cus.
5. Actual user condition fulfillment.
6. Invocation of longer period of limitation.

Analysis:

1. The judgment revolves around the denial of the benefit of Notification No. 32/2005-Cus. for the imported RBD Palmolein under the Target Plus Scheme. The appellant had exported various products, including Rice, Wheat, and Maize, to accrue credits for importing Palmolein. The Commissioner confirmed the duty demand, confiscated the goods, and imposed a penalty based on the absence of nexus between the imported and exported goods.

2. The appellant sought waiver and stay for the adjudged dues. The counsel argued that the imported goods met the "broad nexus" condition required under the Foreign Trade Policy. They also referenced the quashing of Board's Circular No. 21/2007-Cus. by the Bombay High Court, emphasizing fulfillment of the actual user condition and contesting the invocation of a longer limitation period.

3. The counsel highlighted the product-to-product nexus between Rice, Wheat, and Palmolein, all falling under the "Food Products" category, supporting the appellant's claim for the benefit of the Target Plus Scheme. The Tribunal observed that the Input-Output Norms confirmed the nexus, favoring the appellant's position and justifying waiver of pre-deposit and stay of recovery for the adjudged dues.

4. The Tribunal considered the narrow compass of the debated issue, focusing on the absence of product-to-product nexus as the sole ground for denying the Notification's benefit. By acknowledging the nexus between the imported Palmolein and exported goods within the same product group, the Tribunal found merit in the appellant's case, leading to the allowance of the application for waiver and stay of recovery.

5. In conclusion, the Tribunal's decision was based on the established nexus between the imported and exported goods, as per the Input-Output Norms and the conditions specified in the authorization letter from the DGFT. The judgment highlights the importance of fulfilling policy requirements and the relevance of nexus in determining eligibility for scheme benefits, ultimately leading to the allowance of the appellant's application for waiver and stay.