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2024 (9) TMI 417 - AT - CustomsExemption of 4% of SAD against at Sno. 2 of table to Notification No.21/2012-Cus dated 17.03.2012 - failure to comply with provisions of Legal Meteorology Act, 2009 and the Rules made there under - HELD THAT - As per the evidence available on the record, the goods were cleared under Bill of Entry dated 04.08.2014 and thereafter on 07.11.2014, the respondent had intimated the appellant regarding short levy of Rs. 70,384/- in respect of the above bill of entry on the ground that on Post Clearance Audit of Bill of Entry, it is noticed that for few of the items in the bill of entry, 4% SAD exemption was claimed under Notification No. 21/2012-Cus. However, to claim the exemption, the goods should be pre-packaged and intended for Retail Sale and Retail Sale Price should be declared on the packages. Thus, for the above omission, the demand was raised. There is no allegation that the goods do not fall under MRP statutory provisions to claim eligibility of the benefit of N/N. 21/2012-Cus under the Legal Meteorological Rules, 2011. As per the finding in the impugned order, it is alleged that the importer failed to declare the MRP details in any of the import document. However, there is no requirement under any provision of law to make declaration of MRP in the Bill of entry and requirement is only to affix the MRP on the retail packages. In the absence of any such requirement under the Notification No. 21/2012-Cus, no presumption can be drawn that after the clearance of the goods, the packages were not affixed with MRP to meet the requirement of the Notification No. 21/2012-Cus. Appeal allowed.
Issues:
Alleged failure to comply with Legal Meteorology Act, 2009 and Rules made thereunder for claiming exemption of 4% SAD under Notification No.21/2012-Cus; Allegation based on documentary evidence without proper examination of goods; Denial of benefit of notification due to alleged non-declaration of MRP on pre-packaged commodities; Discrepancy in post clearance audit leading to demand for duty; Appeal against impugned order rejecting the claim for exemption; Requirement of affixing MRP on retail packages under Notification No.21/2012-Cus. Analysis: The case involved an appeal by M/s. Kriztle Bath and Wellness Pvt. Ltd. against a demand for duty amounting to Rs. 70,834 based on an alleged failure to comply with the Legal Meteorology Act, 2009 and Rules made thereunder for claiming exemption of 4% SAD under Notification No.21/2012-Cus. The Adjudication authority held that the appellant was not eligible for the exemption as they failed to comply with the conditions of the notification at the time of import. The correct procedure advised was to pay the applicable SAD on importation and then claim a refund after selling the goods as per provisions of another notification. The Commissioner (Appeals) upheld this decision, leading to the present appeal. During the hearing, the appellant's counsel argued that the allegation was unjustified as it was based solely on documentary evidence without proper examination of the goods. The appellant contended that the goods were pre-packaged commodities intended for retail sale, with retail prices declared on the packages as required by the Legal Meteorology Package Commodities Rules, 2007. The counsel emphasized that there was no requirement to declare the MRP in the import documents under the notification in question. The counsel further argued that the silence of the proper officer regarding the alleged non-fixing of MRP documentation on the package at the time of clearance did not amount to non-declaration of MRP by the appellant. It was asserted that allegations for denying the notification's benefit could only be substantiated through a physical examination of the goods, not merely by verifying documents produced during import or clearance. The Authorized Representative for the Revenue reiterated the findings in the impugned order, emphasizing the absence of evidence regarding the affixing of MRP on the packages as a basis for denying the appellant's claim for the notification's benefit. However, upon perusing the records, the Tribunal found that the goods were cleared based on the appellant's declaration of SAD as 'NIL' as per the notification. The Tribunal noted that the demand for duty was raised after a post clearance audit revealed an alleged omission regarding the affixing of MRP on pre-packaged commodities. The Tribunal concluded that the demand should have been initiated at the time of clearance if there were concerns about compliance with MRP requirements, rather than at a later stage based on assumptions. It was highlighted that there was no requirement to declare MRP in the import documents, and the obligation was to affix MRP on retail packages. As there was no evidence that the goods did not comply with MRP statutory provisions, the Tribunal allowed the appeal, granting consequential relief as per law. In summary, the Tribunal allowed the appeal, emphasizing the lack of evidence supporting the denial of the notification's benefit based on MRP compliance, as the requirement was to affix MRP on retail packages, not to declare it in import documents.
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