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TMI Blog2016 (9) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed in the member countries are eligible for concessions under SAPTA Rules when the base goods are not produced/manufactured in the contracting countries. The only requirement under these Rules is that a certification of origin has to be produced for availing concessions as issued by the designated authority of Govt. of exporting contracting state and notified to the other contracting states in accordance with the certification procedures mentioned in the form annexed to SAPTA Rules. It is observed from various provisions of SAPTA Rules and Notification No.105/99-Cus dated 10.08.1999 that there is no discretion or power with the Customs authorities to reject the certificate of origin given by the concerned contracting state. Para 9 of the same Schedule does give power to the contracting states to review/modify the said Rules. The decision the case ZUARI INDUSTRIES LTD. Versus COMMISSIONER OF C. EX. & CUSTOMS [2007 (3) TMI 12 - SUPREME COURT OF INDIA] is relied upon - Certificates of origin produced by the Appellant cannot be discounted. There is no evidence on record that designated authority of Bangladesh under SAPTA Rules was maliciously involved with the supplier of clove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules) read with Notification No.105/99-CUS dated 10.08.1999, as amended. That Adjudicating authority has denied the benefit of Notification No.105/99-CUS on the grounds that imported cloves are not of Bangladesh origin and have been mis-declared as Processed Clovs by showing abnormally high value addition. That Appellant submitted the required certificates with respect to Bangladesh origin of cloves from prescribed authority in Bangladesh as per SAPTA Rules and that Revenue has not alleged that the said certificates of origin are forged. That so long as the certificate of origin continue to remain in force department cannot deny the benefit of Notification No.105/99-Cus. Learned Sr.Advocate made the Bench go through the certificates of origin issued by the appropriate authority in Bangladesh. Learned Sr.Advocate also relied upon the following case laws in support of his arguments:- (i) Zuari Industries Ltd. v. Commissioner of C.Ex. Customs [2007 (210) ELT 648(SC)] (ii) Yellamma Dasappa v. Commissioner of Customs [2000 (120) ELT 67 (Kar)] (iii) Bombay Chemicals Pvt.Ltd. v. Appellate Collector of Customs [1990 (49) ELT 190 (Bom)] (iv) Bharat Heavy Electricals Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat even the Appellant has accepted activities of drying, grading and packing cannot lead to value addition of 69%. He made the Bench go through Q.No.22 of the statement dated 01.06.2005 of Shri Nirmal Kumar Bhura, Director of the main appellant. That Chairman of Spices Board of India vide letter dated 12.07.2005 has opined that processes carried out by the supplier will not make the cloves as processed cloves which are called exhausted cloves or spent cloves and will also not make the goods of Bangledesh origin. Learned AR thus strongly defended the Order-in-Original dated 28.02.2007 passed by the Adjudicating authority. 4. Heard both sides and perused the records of the case. The issue involved in the present appeal is whether the main appellant is eligible to avail partial exemption under Notification No.105/99-CUS dated 10.08.1999 when read with SAPTA Rules. As per the first Proviso to this Notification, the Assistant Commissioner/Deputy Commissioner/Joint Commissioner has to be satisfied that imported goods are in accordance with the Customs Tariff (Determination of Origin of Goods under the Agreement on SAARC Preferential Trading Arrangement) Rules, 1955- [SAPTA Rules]. As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he exemption notification. We may add that, the essentiality certificate is also a proof that an item like Captive Power Plant in a given case could be treated as a capital goods for the fertilizer project. It would depend upon the facts of each case. If a project is to be installed in an area where there is shortage of electricity supply and if the project needs continuous flow of electricity and if that project is approved by the Sponsoring Ministry saying that such supply is needed then the Revenue cannot go behind such certificate and deny the benefit of exemption from payment of duty or deny nil rate of duty. To the said effect is the judgment of the Calcutta High Court in the case of Asiatic Oxygen Ltd. (supra) in which it was held that the object behind the specific Heading 98.01 in Customs Tariff Act, 1975 was to promote industrialization and, therefore, the heading was required to be interpreted liberally. It was further held that, once an essentiality certificate was issued by the Sponsoring authority, it was mandatory for the Revenue to register the contract. 4.2 Karnataka High Court in the case of Yellamma Dasappa v. Commissioner of Customs, Bangalore (supra) also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority for re-examining all the facts, material, evidence, furnished by both the sides to certify the installed capacity. As per the direction of this Tribunal the Director of Industries was addressed by the Adjudicating Authority on 5-9-2002 along with copies of 11 documents (Para 12 of the impugned order) which are relied upon by the Revenue to contest the correctness of certificate issued by the competent authority. In response, the Commissioner of Industries vide his letter dated 17-6-2003 categorically stated that the installed capacity of the appellant unit is 1,98,000 T.P.A. during the impugned period. He also observed that with reference to the various evidences submitted by the Revenue his office is in agreement with the clarification given by the appellant that their annual installed capacity was 1,98,000 M.T. and they were capable to produce 25% extra, which comes to 2,47,500 T.P.A., for which there was no restriction from the Government end. We have noted that all the evidences available with the Department have been submitted to the Commissioner of Industries who reiterated the certificate already issued. In spite of such confirmation by Commissioner of Industries, Madh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been conveniently avoided by the Adjudicating Authority and no observations are given as to why request of the appellant for cross-examination is not acceptable. In the absence of cross examination the evidentiary value of the relied upon witnesses is lost. Secondly, Shri Doletram T.Chhabria is also an exporter and importer of spices whose business is threatened by concessional rate on cloves under SAPTA Rules. Being an interested party his statement otherwise also can also not be relied upon and used against the Appellants. It is observed from the SAPTA Rules that the concessions to member countries are as a result of commitments amongst the SAARC countries for enhancing, inter alia, the trade between the members contracting countries. Great trust is imposed under SAPTA Rules upon the designated authority of Govt. of the Exporting Contracting State as per para-7 of the Schedule to SAPTA Rules. To fulfill the commitments to SAARC nations a certificate of origin given by exporting contracting state cannot be scuttled by the department by conducting some local investigation creating confusion in extending the exemption benefits. As already observed a certificate of origin issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tside and onion grown in the State of Assam inasmuch as both are subjected to levy of sales tax. The argument in this connection has centred round the definition of the word processed . It is urged by the learned counsel for the petitioner that onion cannot be processed inasmuch as it is not subjected to any mechanical process after it has been removed from the earth. The word process used as transitive word means according to Webster s New International Dictionary to prepare by or subject to treatment or process . In Nilgri Ceylon Tea Co. v. State of Bombay, Shah, J. as he then was, observed as follows: The expression process has not been defined in the Act. According to Webster s Dictionary process means to subject to some special process or treatment, to subject (especially raw material) to a process of manufacture, development or preparation for the market, etc., to convert into marketable form, as livestock by slaughtering, grain by milling, cotton by spinning, milk by pasteurising, fruits and vegetables by sorting and repacking. (1) [1964] 15 S.T.C. 450 (S.C.); A.I.R. 1964 S.C. 1006. (2) [1963] 14 S.T.C. 355 (S.C.); A.I.R. 1963 S.C. 928. (3) [1969] ..... X X X X Extracts X X X X X X X X Extracts X X X X
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