2015 (11) TMI 1396 - AT - Customs

Denial of benefit of exemption Notification to the goods imported before the issue of public notice dated 18/5/2011 which were ex-bonded after the issue of public notice - removal of condition of Actual user - Held that - The exemption is available subject to the condition that rate of duty shall apply such quantity of imports for which importer hold tariff rate quota allocation certificate issued by the custom facilitation committee in the DGFT in accordance with the procedure as may be specified.. We find that licence number under which the goods were ex-bonded No. 0550002311 issued to the respondent for release Tariff Rate Quota for the year 2011-12. - If there was any mis-representation it was for the licencing authority to take steps on that behalf. We find that in the present case that there is not even iota on doubt that there was mis-representation on the part of the respondent. Similarly in the case of Autolight (India) Ltd.(2003 (4) TMI 119 - HIGH COURT OF JUDICATURE AT BOMBAY) it was held by the Hon ble Mumbai High Court that custom authorities cannot be sit in pin over the decision of licencing authority. In view of the matter we find nothing miss and held that the licence without actual user stipulation is authority for the --- by the clearance of the subject goods. - no hesitation in rejected the appeal of the Revenue. - Decided against revenue.

Summary

Issues:
1. Denial of benefit of exemption under Notification 21/2002 dated 1/3/2002 to the appellant.
2. Interpretation of the actual user condition in import licensing.
3. Validity of public notice dated 18/5/2011 by DGFT removing actual user condition.
4. Applicability of import policy at the time of import.
5. Comparison of licensing conditions and their impact on exemption denial.

Issue 1: Denial of benefit of exemption under Notification 21/2002:
The appellant imported maize corn and warehoused them, seeking exemption under Sr. 21 of Notification No. 21/2002-CUS. The Revenue's appeal was based on the contention that the public notice dated 18/5/2011 by DGFT, removing the actual user condition, should not be applied retrospectively. The division bench of the Hon'ble High Court of Andhra Pradesh had differing views on the validity of the public notice.

Issue 2: Interpretation of the actual user condition in import licensing:
The Revenue argued that the actual user condition was not deleted by DGFT in the public notice dated 18/5/2011. They emphasized that the import policy applicable at the time of import should govern the case, citing legal precedents to support their stance. The appellant's counsel highlighted the absence of the actual user condition in the import license, asserting that the customs authority cannot refuse exemption based on licensing discrepancies.

Issue 3: Validity of public notice dated 18/5/2011 by DGFT:
The respondent's counsel referred to the Hon'ble Andhra Pradesh High Court's decision upholding the validity of the public notice dated 18/5/2011. They argued that the absence of the actual user condition on the license issued to the appellant was crucial in determining the eligibility for exemption under Notification 21/2002.

Issue 4: Applicability of import policy at the time of import:
The DGFT clarification dated 21/9/2011 regarding the clearance of goods against TRQ authorization for the year 2011-12 highlighted the relevance of the import policy at the time of import. This clarification undermined the Revenue's argument regarding the retrospective application of the public notice.

Issue 5: Comparison of licensing conditions and impact on exemption denial:
The Tribunal examined the licensing conditions and emphasized that the license issued to the appellant did not contain the actual user condition. Citing legal precedents, the Tribunal held that the customs authority cannot deny exemption based on alleged misrepresentations or discrepancies in the licensing process.

In conclusion, the Tribunal rejected the Revenue's appeal, affirming the appellant's right to exemption under Notification 21/2002 based on the licensing conditions and the validity of the public notice dated 18/5/2011 by DGFT. The judgment underscored the importance of adhering to the import policy in place at the time of import and upheld the appellant's entitlement to the exemption under the prevailing circumstances.