2013 (12) TMI 882 - AT - Customs

Import of nylon filament yarn - Exemption Notification No. 29/2004-C.E., dated 9-7-2004 as amended by Notification No. 10/2005-C.E., dated 1-3-2005 - Held that - claimed exemption under amended Notification No. 29/2004-C.E. is meant for processed filament yarn and the impugned goods under import are not processed filament yarns, prima facie, the appellants are not eligible for the duty concession claimed - The 2nd appellant has no doubt taken a ground regarding limitation but the same was not argued and further the claim of limitation has not been substantiated by producing a copy of the show-cause notice and the copies of the Bills of Entry. Hence, at the prima facie stage, no view can be taken on the claim of limitation - prima facie no case has been made out for total waiver of pre-deposit - Partial stay granted.

Summary

Issues involved:
Dispute over Additional Duty of Customs rate under exemption Notification No. 29/2004-C.E. for imported unprocessed nylon filament yarn.

Analysis:

Issue 1: Classification and nature of imported goods
The appellants, manufacturers of narrow woven fabric and braided cord, imported nylon filament yarn through Chennai Port. The classification of the impugned goods as unprocessed nylon filament yarn under Sub-heading 5402 10 10 is undisputed. The appellants did not provide any evidence to support the claim that the imported goods were processed nylon filament yarn.

Issue 2: Interpretation of exemption notification
The dispute revolves around the application of the exemption Notification No. 29/2004-C.E., as amended by Notification No. 10/2005-C.E., regarding the rate of Additional Duty of Customs equal to Excise duty. The notification prescribes a concessional duty of 8% for processed filament yarn procured from outside and subjected to any process. The Budget instruction accompanying the amending notification clarifies that the 8% duty rate is for processed filament yarn manufactured by independent processors.

Issue 3: Eligibility for duty concession
Given that the exemption under the amended notification is intended for processed filament yarn and the imported goods are unprocessed filament yarns, the appellants are not prima facie eligible for the claimed duty concession. The tribunal found no basis to support the appellants' claim for exemption based on the nature of the imported goods.

Issue 4: Limitation and financial hardship claims
While the 2nd appellant raised a ground regarding limitation, it was not argued effectively, and the claim was unsubstantiated by relevant documentation. The appellants did not plead financial hardship in their stay applications or during arguments. Consequently, the tribunal did not find grounds for a total waiver of pre-deposit.

Conclusion:
The tribunal directed both appellants to pre-deposit 50% of the duty amount within four weeks and report compliance within another four weeks. The requirement of pre-deposit for the remaining amount was waived during the pendency of the appeals, subject to compliance with the tribunal's directive.

This comprehensive analysis of the judgment addresses the issues involved, the tribunal's findings, and the directives provided to the appellants regarding the disputed Additional Duty of Customs rate for imported unprocessed nylon filament yarn.