2016 (12) TMI 71 - AT - Customs

Project imports - concessional rate of duty under Chapter heading 9801 - Project Import Regulations, 1986 - whether the denial of benefit of concession on the ground that the appellant had not provided the reconciliation statement and had not produced the installation certificate from the project implementing authority, is justified? - principles of natural justice - Held that - the CBEC s Customs Manual of instructions indicate as how to treat the goods imported under project imports. The instructions in CBEC needs to be followed by the adjudicating authority while finalizing the bills of entry under project imports. We also find that the adjudicating authority should have considered the factual matrix in its proper perspective before coming to a conclusion. In view of this, without expressing any opinion on the merits of the case, keeping all the issues open, we set aside the impugned order and remand the matter back to the adjudicating authority to reconsider the issue afresh after following the principles of natural justice - appeal allowed by way of remand.

Summary

Issues:
- Appeal against Order-in-Appeal No.28/06/MCH/DC/Contract dated 16/01/2006 passed by Commissioner of Customs (Appeals), Mumbai regarding denial of benefit under Project Import Regulations, 1986.
- Dispute over the production of reconciliation statement and installation certificate for imported goods.
- Consideration of CBEC's Customs Manual of instructions and principles of natural justice in finalizing bills of entry under project imports.

Analysis:
1. The appellant imported goods for establishing a factory and claimed concessional duty under Chapter heading 9801 as per Project Import Regulations, 1986. A contract was entered into with a company for erection of the manufacturing unit, but the benefit of project import regulations was denied during finalization of bills of entry due to lack of reconciliation statement and installation certificate.

2. The appellant argued that the project was completed and production commenced, as evidenced by the balance sheet of the company involved in the project. The Departmental Representative contended that without the required documents, finalization of bills of entry was not possible.

3. The Tribunal considered CBEC's Customs Manual of instructions on project imports, emphasizing that the adjudicating authority must adhere to these guidelines. It was noted that the authority should have evaluated the factual scenario properly before making a decision. Therefore, the Tribunal set aside the impugned order and remanded the matter for reconsideration, emphasizing the importance of following the principles of natural justice.

4. The Tribunal did not express any opinion on the merits of the case but directed the adjudicating authority to review the issue afresh, considering all aspects and ensuring compliance with the principles of natural justice. Ultimately, the impugned order was overturned, and the appeal was allowed for reconsideration by the adjudicating authority.