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TMI Blog2009 (8) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... cellation of the licence but neither any such reference has been made nor the licence has been cancelled. It is settled law that Customs Authrities cannot be sit in judgment over the decision of DGFT to issue an advance licence and go behind the licence to deny its benefit to the importer. – appeal allowed - C/330-332/2006 - C/393-395/2009(PB), - Dated:- 17-8-2009 - S/Shri D.N. Panda, Member (J) and Rakesh Kumar, Member (T) Shri Bipin Garg, Advocate, for the Appellant. Shri Vijay Kumar, DR, for the Respondent. [Order per: Rakesh Kumar, Member (T)]. - The facts of the case leading to these appeals are, in brief, as under :- 1.1 The appellant company have a manufacturing unit in Jaipur where they manufacture Electrical Grade Insulation Kraft Paper (EGIKP) and Electrical Grade Insulation Pre-Compressed Press Boards (EGIPB). Shri Anup Dhanuka and Shri Alok Dhanuka are the Directors of the appellant company. The appellant company in their factory first manufacture EGIKP from Electrical Grade unbleached Softwood Pulp which is imported by them and thereafter the EGIKP is used for manufacture of EGIPB. Some of the requirement of EGIKP for use in the manufacture of EGIPB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om electrical grade unbleached softwood pulp and not from EGIKP. M/s. Raman Boards Ltd., Mysore vide their letter dated 10-3-03 informed that they manufactured EGIPB for use in electrical transformers, that they are manufacturing EGIPB from imported electrical grade softwood pulp, that - technically and theoretically EGIPB can be made in limited quantities from EGIKP, that in their opinion it would be uneconomical to do so and it makes no sense commercially to make EGIPB from EGIKP unless the paper comes in rejected and waste forms, and that since EGIKP is far more expensive than electrical grade softwood pulp, it will be far more expensive to make EGIPB from EGIKP. 1.4 M/s. Rajasthan Transformers Switchgears, Jaipur vide their letter dated 29-9-03 informed that they are procuring Kraft Papers from indigenous manufacturers for making EGIPB and they have never purchased the Tomoegawa EGIKP which is used by the manufacturers of DPC Aluminium/Copper Wire and Strip manufacturers for covering of the wire and strips. M/s. Iron Metal Pvt. Ltd., Jaipur vide their letter dated 30-9-03 informed that the EGIKP manufactured by M/s. Tomoegawa Paper Company, Japan being very fine quality ele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant company. 1.7 It is against this order that these three appeals have been filed. 2. Heard both the sides. 2.1 Shri Bipin Garg, Advocate, the learned Counsel representing the appellants, made the following submissions :- (1) The point of dispute in this case is as to whether EGIKP is the raw material for EGIPB or whether EGIPB is manufactured by the appellants from Electrical Grade unbleached Softwood Pulp and whether the appellant company is eligible for duty free import under Notification No. 43/2002-Cus., of the consignment of EGIKP imported against the advance licence. The Department's conclusion that EGIPB is made from wood pulp and not from EGIKP and that EGIKP is not the raw material for EGIKP is without any basis. (2) The fact that the appellant company first manufacturers EGIKP from Electrical Grade Softwood Pulp and from EGIKP, the EGIPB is manufactured has been verified by the departmental officers but the fact of actual process of the appellant's company was not brought on record by the department. The department solely relies upon replies to the department's letters received from M/s. Raman Boards Ltd., Mysore and M/s. Senapathy Whiteley Pvt. Ltd., Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utput norms (SION) in respect of EGIPB and while fixing the SION the DGFT had taken into account a certificate issued by the Chartered Engineers regarding the production process of EGIPB in the appellant's unit. The Department has not disputed the production process as mentioned in the Chartered Engineer's Certificate. (8) The appellant company were utilizing self manufactured as well as purchased EGIKP for manufacturing EGIPB in past to this dispute and subsequently. The appellant's competitors M/s. Senapathy Whiteley Pvt. Ltd., Bangalore installed the plant around 1961 and M/s. Raman Boards Ltd., Mysore installed the plants in 1982 and both are using second hand machinery whereas the appellant company had installed the plant in 2001 by using latest technology. Hence, the comparison of the production process is unjustified. 2.2 Shri Vijay Kumar, the learned Senior Departmental Representative, reiterating the Commissioner's finding in the impugned order, defended the same and emphasized on the following points :- (1) The imported Tomoegawa EGIKP is of very superior quality Kraft Paper. It is clear from the inquiry with M/s. Rajasthan Transformers and Switchgears, Jaipur and f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per" manufactured by M/s. Tomoegawa Paper Company, Japan. Duty free clearance of these goods is sought under Notification No. 43/02-Cus., as amended, against advance licence for intermediate exports dated 9-6-03 issued by EGFT. This licence is valid for import of 34.925 MTs of EGIKP valued at U.S. $ 63,670/-. Notification No. 43/02-Cus. provides for full exemption from the basic Customs Duty, Additional Customs Duty chargeable under Section 3 of Customs Tariff Act, and safeguard duty anti dumping duty chargeable under Section 8 and 9 (a) respectively of the Customs Tariff Act, in respect of the goods imported into India against an advance licence issued in terms of sub-para (a) and (b) of para 4.1.1 of the EXIM Policy subject to the conditions specified in this notification the main condition being that- (a) The description, value and quantity of the material imported are covered by the said licence and the said licence is produced before the Proper Officers of Customs at the time of clearance of debit and (b) Where the import takes place after the fulfillment of the export obligation, the shipping bill numbers, quantity and FOB value of the resultant and product exported are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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