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TMI Blog1997 (7) TMI 313X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the consignee M/s. Hindustan Tractors Ltd., Baroda, did not possess L-6 licence required for the removal of excisable goods without payment of duty on AR-3A in pursuance of Chapter X procedure and on the ground that the consignee had issued CT-2 forms meant for motor vehicle parts under Tariff Item 34A, and not for tyres and tubes falling under T.I. 16. The duty demand was confirmed by the Assistant Collector of Central Excise, Faridabad; however the Collector (Appeals) accepted the contention of the respondents that the substantive part of the notification, above mentioned, was satisfied and, therefore, non-fulfilment of procedural requirement was not detrimental to their claim for the benefit of the notification and accordingly set aside the demand. 2. We have heard, Shri M. Jayaraman, learned JDR and Shri Amit Bansal, learned advocate for the respondents. 3. We see force in the contention of the learned DR that the benefit of Chapter X procedure can be availed of only by L-6 licence holders. In this case, the consignee viz. M/s. Hindustan Tractors Ltd. did not possess an L-6 licence for tyres and tubes during the relevant period i.e. from June, 1976 to August, 1976 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the name of the commodity though other particulars were duly filled in. The respondents sent the tyres and tubes by availing the concession but only at a later date. It was alleged by the Department that the consignee was not having a separate L-6 licence for tyres and tubes. From copies of correspondence filed along with the appeal, it is seen that the original equipment manufactured had already taken up with the Central Excise Authorities whether it was necessary to have a separate L-6 licence and they finally took one for tyres and tubes but by then, the goods had duly moved under regular AR-3A forms and were duly verified and received as evident from the copies of AR-3As filed along with the appeal. It is also seen from the consignee s letter dated 18-11-1976 that they had executed additional bond by depositing necessary amount on 19-6-1976 itself on the understanding that a separate L-6 licence was not necessary. Even the Inspector, Central Excise had issued a revised certificate in form CT-2 with the enhanced value and copies of these were sent to the tyres, tubes and battery manufacturers and finally a separate application for L-6 licence was filed in the third week of Augu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w of the Central Excise, the demand for duty of Rs. 1,55,171.80 has been set aside. 11. Learned counsel drew attention to the Tribunal s orders in the cases of Collector of Customs, Cochin v. Coods Agro Chemicals reported in 1996 (82) E.L.T. 608 and Thermax Pvt. Ltd. v. Collector of Customs reported in 1992 (61) E.L.T. 352 (S.C.) in support of his contention that the benefit of a provision, if otherwise due, should not be disallowed in case procedural requirements of Chapter X were not fully complied with. 12. He also stated that in view of the correspondence exchanged with the Department regarding requirement of separate L-6 licence, the matter was one requiring regularisation, if any called for and not one of denying the benefit which was otherwise due. 13. I have considered the above submissions. While I agree with my learned Colleague that L-6 licence was necessary for availing the benefit of Chapter X procedure and it was an important requirement which cannot be lightly ignored, at the same time, in a situation like the one involved in the present case, one is required to take the totality of facts and circumstances into consideration. 14. In the present case, there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /76, dated 12-5-1976 and the Collector has come to the conclusion that all other essential conditions of this notification have been duly fulfilled inasmuch as there was no doubt or dispute that these items were supplied and received as original equipment of a type covered by the aforesaid notification and were put to the prescribed use. In these circumstances, the benefit which was otherwise due under Notification No. 161/76, dated 12-5-1976 should not have been denied and the learned counsel has rightly relied upon the Hon ble Supreme Court s judgment in the case of Thermax Pvt. Ltd. v. Collector of Customs reported in 1992 (61) E.L.T. 352 (S.C.) although this case related to remission of additional duty in respect of imported goods. It is significant that Hon ble Supreme Court had confirmed the Board s own view that benefit was not deniable if substantive condition of intended use as per the exemption notification was satisfied though procedural condition of Chapter X was not complied with. In the present case, there is no doubt or dispute that the goods were put to intended use. 19. In the above circumstances, I hold that the Collector was justified in passing his order. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the CT-2 intimation were received. This substantive requirement got indirectly fulfilled in this case in view of the AR-3 applications and CT-2 certificates and anticipation of issue of a formal licence, it would have been more appropriate to impose a penalty rather than denying the substantive benefit which was otherwise due. The Hon ble Vice President has also held that the Hon ble Supreme Court in the case of Thermax Pvt. Ltd. has confirmed the Board s own view that benefit was not deniable if substantive condition of intended user as per the exemption notification was satisfied though procedural condition of Chapter X was not complied with. The Hon ble Vice President has also noted that subsequently the L-6 licence had already been issued. Therefore, in the facts of this particular case, he held that the benefit is to be extended. 23. On a careful consideration of the opinions given by the respective members, I am of the considered opinion that the opinion rendered by Hon ble Vice President is correct in the light of the facts that the goods had moved under CT-2 certificates and under AR-3A applications. A significant point which has to be noted in this case is that there i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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