2018 (9) TMI 267 - AT - Customs

Relief from payment of Customs Duty alongwith Interest - N/N/ 93/2004-Cus dated 10th September 2004 - failure to furnish the export obligation discharge certificate issued by the competent authority within the deadline stipulated therein - Held that - There has been substantial compliance of export obligation by the appellant. With the furnishing of the redemption certificate, the consequential liability, to that extent, ceased to sustain - the demand, but for ₹ 88,716.17 of duty liability and ₹ 84,110.22 of interest, computed as proportionate to the short-fall in fulfillment of the export obligation, is set aside. Appeal disposed off.

Summary

Issues: Duty relief and interest relief sought by the appellant for noncompliance with export obligation discharge certificate requirement.

Analysis:
1. The appellant sought relief from duty and interest amounting to a total of ?1,11,73,096 confirmed by the Commissioner of Central Excise & Customs (Appeals) for noncompliance with the obligation to furnish the 'export obligation discharge certificate' within the stipulated deadline under notification no. 93/2004-Cus dated 10th September 2004.

2. The appellant's counsel submitted a redemption letter dated 7th August 2013 issued by the Director General of Foreign Trade, stating that a pre-deposit of ?2,00,000 made in accordance with the Customs Act, 1962, was sufficient to cover the shortfall recorded in the discharge certificate.

3. The Authorized Representative for the respondent highlighted that the proceedings were initiated against the appellant not only for failure to comply with the discharge certificate requirement but also for failure to fulfill the export obligation.

4. After considering the submissions from both sides, the Tribunal observed that there was substantial compliance with the export obligation by the appellant. The furnishing of the redemption certificate led to the cessation of consequential liability to that extent. Consequently, the demand was set aside, except for ?88,716.17 of duty liability and ?84,110.22 of interest, calculated proportionately to the shortfall in meeting the export obligation.

5. The appeal was disposed of by limiting the recovery to the specified extent, thereby providing relief to the appellant while upholding the duty and interest liability related to the shortfall in fulfilling the export obligation.

Judgment:
The Appellate Tribunal CESTAT Mumbai, through the members Shri Anil Choudhary and Shri C J Mathew, granted partial relief to the appellant concerning duty and interest liabilities amounting to ?1,11,73,096 due to noncompliance with the export obligation discharge certificate requirement. The Tribunal acknowledged the substantial compliance with the export obligation by the appellant upon submission of the redemption certificate, leading to the setting aside of the demand, except for specific duty and interest liabilities linked to the shortfall in meeting the export obligation. The judgment highlights the importance of fulfilling export obligations and the consequences of noncompliance despite providing a degree of relief based on the circumstances presented during the proceedings.