2017 (4) TMI 1044 - AT - Customs

Import against advance license - export obligation - Benefit of N/N. 93/2004 dated 10.9.2004 - denial on the ground that the appellant could not produce EODC from DGFT and thus violated the condition of the notification - whether the Customs duty foregone in terms of notification at the time of import is required to be adjudicated and confirmed, in case EODC are not produced but the factum of export is otherwise established from the parallel document? - Held that - The notification condition requires the importer to produce the evidence of discharge of export obligation to the satisfaction of the authorities. Such discharge of export obligation can be established by any evidence, which need not be EODC. If such discharge of export obligation can be established by the importer from the other documents, as has been done in the present case, the non-submission of EODC certificate can not be held to be violation of condition of notification - appeal rejected - decided against Revenue.

Summary

Issues:
1. Interpretation of Customs Notification No.93/2004 regarding import conditions and export obligations.
2. Requirement of Export Obligation Discharge Certificate (EODC) for fulfilling conditions of the notification.
3. Validity of confirmation of demand for duty foregone in case of non-submission of EODC.
4. Authority of Customs department in verifying export obligations without EODC.
5. Applicability of Foreign Trade Policy provisions in Customs duty cases.
6. Interpretation of notification conditions and relevance of EODC in establishing export obligations.

Analysis:
The case involved a dispute regarding the import of various inputs under Advance License as per Customs Notification No.93/2004, which allows imports at nil duty rate upon fulfilling export obligations. The Customs initiated proceedings against the importer for failing to produce the Export Obligation Discharge Certificate (EODC) from DGFT, leading to a demand for the duty foregone. The original adjudicating authority confirmed the demand, citing the absence of EODC as a violation of the notification.

Upon appeal, the Commissioner (Appeals) noted that the notification did not specify the requirement of submitting EODC. The Commissioner emphasized the importance of fulfilling export obligations rather than producing EODC, as evidenced by various documents submitted by the importer. The Commissioner referred to relevant legal precedents, including a Supreme Court decision, to support the view that Customs authorities must independently verify compliance with notification conditions.

The Revenue appealed the decision, arguing that EODC submission is mandatory under the Foreign Trade Policy. However, the Tribunal clarified that the issue was not about redeeming the advance license but confirming Customs duty foregone when EODC is not provided. The Tribunal determined that the notification did not mandate EODC submission and upheld the Commissioner's decision, emphasizing that no extraneous conditions can be imposed beyond the notification's language.

Ultimately, the Tribunal rejected the Revenue's appeal, highlighting that the notification must be interpreted as written, and the absence of EODC submission does not constitute a violation if export obligations are otherwise proven. The decision underscored the importance of adhering to notification terms without introducing additional requirements from external policies.