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TMI Blog1992 (7) TMI 169X X X X Extracts X X X X X X X X Extracts X X X X ..... he DEEC Book to the effect, Import of Instruments to be allowed on payment of duty only." After the clearance of the impugned goods, the appellants filed a refund claim seeking exemption in terms of Notification No. 44/87-Cus., dated 19-2-1987. They claimed that the components had been exported to Bhutan for reaction of lime kiln (industrial furnace) under a contract between M/s. Bhutan Carbide and Chemicals Ltd., Bhutan and the payment has been received in foreign currency. The Asstt. Collector of Customs rejected the refund claim on the grounds that the impugned goods were exported without carrying out any process of manufacture on the imported goods. He held that in terms of Notification No. 44/87-Cus., dated 19-2-1987, goods are allowed to be imported for manufacture of resultant product which is required to be exported. The goods had been exported in the same condition as they were imported and hence the claim was rejected. The learned Collector (Appeals) also rejected the contentions of the appellants. The appellants in this appeal are contending that they have fulfilled all the conditions of the Notification No. 44/87 excepting that the components imported for the assembly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licence when all the terms of the licence and conditions of DEEC had been followed. Although the goods required to undergo some process of manufacture before exported yet this process need not be carried out in India itself but the importer could carry it out in Bhutan also as per the terms of their agreement with their party. The Govt. of Bhutan had certified about the manufacture of the resultant product and therefore, the terms of the notification are deemed to have been fulfilled. The imported components were for the use in the lime kiln and the lime kiln had been set up in Bhutan and the product ultimately put to use. He relied on the following notings in support of his case : (i) State of Tamil Nadu v. Kodaikanal Motor Union (P) Ltd. - reported in 1986 (8) ECR 241. (ii) M/s. Indian Telephone Industries v. CC, Madras - reported in 1987 (30) E.L.T. 523 (Tri.) = 1987 (12) ECR 919. (iii) Commissioner of Income Tax, Bangalore v. J.H. Gotia - reported in AIR 1985 S.C. 1698. 4. Shri K.K. Bhatia, learned JCDR countering the arguments of the appellants advocate, contended that the imported item has to undergo process of manufacture and bring into existence a new resultant pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not been done so and hence the benefit as claimed by applicant is not granted at all. 5. Dr. Kantawala countering the arguments submitted that Section 74 of the Act cannot be applied to the facts of the present case. 6. We have carefully considered the submissions made by both the sides and perused the records. The question that arises for our consideration is as to whether the appellants are entitled to the benefit of the Notification No. 44/87-Cus., dated 19-2-1987 in respect of the components of lime kiln (industrial furnace) exported by them to Bhutan without carrying out any process of manufacturing on the imported item. 7. The Notification No. 44/87, dated 19-2-1987 is reproduced below: G.S.R. (E) - In exercise of the powers conferred by sub-section (1) of Section 25 of the Customs Act, 1962 (52 of 1962) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 117/Customs [G.S.R. 318 (E)] dated the 9th June, 1978, the Central Government being satisfied that it is necessary in the public interest so to do, hereby exempts goods imported into India, against an Advance Licence issued under the Imports (Contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... older of an advance licence being a manufacturer-exporter may utilise the replenished materials for further production subject to actual user conditions : Provided further that the licensing authority may consider the request of holder of an advance licence not being a manufacturer-exporter for transfer of the replenished materials at landed cost, to the supporting manufacturer concerned, whose name appears in the said Certificate, for further production, subject to actual user condition: (e) in the case of goods being nylon fibre, nylon yarn, nylon fabrics, polyester fibre, polyester yarn, polyester fabrics, stainless steel sheets, stainless steel strips, magnetic tapes, precious metals, metals clad with precious metals and articles thereof, the import shall be only through any of the sea ports at Kandia, Bombay, Cochin, Madras, Visakhapatnam and Calcutta or through any of the airports at Bombay, Calcutta, Delhi, Madras and Bangalore or through either of the internal container depots at Delhi or Bangalore, and the export of resultant products in which such goods are used shall be only through any of the said sea ports or airports or internal container depots. (f) the import ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs Act separately. A reading of the notification makes it clear that the exemption is given to goods imported in India against an advance licence issued under the Import (Control) Order, 1955 or obtained against an advance release order, being materials required to be imported for the purpose of manufacture of products, which is referred to as resultant products or replenishment of materials used in the manufacture of the resultant products or both or for export as mandatory spares along with resultant products, for the purpose of execution of one or more export orders. In this particular case, admittedly, the goods which have been imported, have not been utilised for the purpose of manufacture of resultant products or for that matter, they have been imported as replenishment of materials used in the manufacture of the resultant products nor they have been imported as a mandatory spares along with resultant products. Therefore, the basic stipulation of the notification has not been fulfilled by the appellants in this case for the purpose of grant of exemption of the notification in question. It is the appellants case that they have imported the components of lime kiln whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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