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TMI Blog2022 (11) TMI 353X X X X Extracts X X X X X X X X Extracts X X X X ..... words namely the same quality, technical characteristics and specification , which are specifically omitted. Such beneficial DFIA scheme which is intended for export promotion, cannot be construed in such manner as suggested by the petitioner. Such recourse would be ex facie erroneous and illegal. It is amply clear that whereas these further words i.e. same quality, technical characteristics and specification are categorically used in Paragraph 4.30 of FTP and also in the second proviso to the condition (iii) of the Customs Notification No.19 of 2015, however they are absent in Paragraph 4.12 of FTP and also in first proviso to condition (iii) of the said Customs Notification. These further words i.e. same quality, technical characteristics and specification cannot be read in Paragraph 4.12and also in first proviso to condition (iii). These further words would apply only while making declaration in shipping bills in respect of sensitive inputs specified in Paragraph 4.30 of FTP, while issuing DFIA in respect of such specified sensitive inputs, or while duty free import of such specified sensitive items under such DFIA to establish close nexus with the specified sensitive in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said Notification read with Paragraphs 4.12 (i), 4.12 (ii), 4.29 (iv) and 4.29 (v) of Foreign Trade Policy, if the imported goods are not of same quality, technical characteristics and specifications as the materials used in the shipping bills; (ii) To issue any Transferrable DFIA or to strictly restrict duty free import entitlement under any Transferrable DFIA already issued as per any specific material actually used with quality, technical characteristics and specifications declared by the exporter/original license holder under Appendix 4H notwithstanding Paragraph 4.27(i) of FTP and the Standard Input Output Norms; 2. The petitioner seeks directions to initiate appropriate action against their erring Officers who have failed to deny exemption from Basic Customs Duty to goods imported by the Transferees under Transferrable Duty Free Import Authorisation (DFIA) despite non-fulfilment of condition contained in first proviso to condition (iii) of the Custom Notification No.19 of 2015 and/or issued Transferrable DFIAs contrary to the provisions and spirit of Foreign Trade Policy. He contends that the officers of the respondent-Union of India have failed in their cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he words same quality, technical characteristics and specifications are used only in second proviso to condition (iii), the same shall also be necessarily read even in the first proviso to condition (ii). The petitioner further contends that to restrict duty exemption in public interest, the officers shall be directed to issue any Transferrable DFIA or to strictly restrict duty free import entitlement under any Transferrable DFIA already issued, only as per any specific material actually used with quality, technical characteristics and specifications declared by the exporter/original license holder under Appendix 4H, notwithstanding Paragraph 4.27(i) of FTP and the Standard Input Output Norms. 3. The petitioner also submits that Exporters, Traders and Importers are importing goods by availing exemption without showing the actual use in the export goods by contending that they are post export replenishments and, therefore, are not required to satisfy the actual user conditions under DFIA Scheme. In many of the input goods, though the input items in SION appears to be of specific entries , but they are actually generic entries . However, they are being imported as specific en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... particulars of materials used in the shipping bill or bill of export; 6. The first and second proviso refer to Paragraphs 4.12(i), 4.12(ii) and 4.30 of Foreign Trade Policy, which read as under:- 4.12 Accounting of Input (i) Wherever SION permits use of either (a) a generic input or (b) alternative input, unless the name of the specific input together with quantity which has been used in manufacturing the export product gets indicated/endorsed in the relevant shipping bill and these inputs, so endorsed, within quantity specified and match the description in the relevant bill of entry, the concerned Authorisation will not be redeemed. In other words, the name/description of the input used (or to be used) in the Authorisation must match exactly with the name/description endorsed in the shipping bill. (ii) In addition, if in any SION, a single quantity has been indicated against a number of inputs (more than one input) then quantities of such inputs to be permitted for import shall be in proportion to the quantity of these inputs actually used/consumed in production, within overall quantity against such group of inputs. Proportion of these inputs actually used/co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of sensitive inputs specified in Paragraph 4.30 of FTP, while issuing DFIA in respect of such specified sensitive inputs, or while duty free import of such specified sensitive items under such DFIA to establish close nexus with the specified sensitive inputs used. 9. Paragraph 4.27 (i) of the FTP stipulates the eligibility criteria for issuance of DFIA as follows:- 4.27 Eligibility: (i) Duty Free Import Authorisation shall be issued on post export basis for products for which Standard Input Output Norms have been notified. 10. It is clear that Paragraph 4.30 is an exception to the above Paragraph 4.27(i) of FTP regarding eligibility for issuance of DFIA. Therefore, wherever sensitive inputs specified in Paragraph 4.30 are used, the DFIA would be issued to permit import of only those material which shall not only be of the specific name/description or quantity, but also having close nexus having the same quality, technical characteristics and specification , as the material used in the export of resultant product. The exporter would also require to declare all these particulars of materials used in the shipping bill. 11. However, in other cases, i.e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in Shah Nanji Nagsi Exports Pvt. Ltd. Vs. Union of India reported in 2019 (367) E.L.T. 335 (Bom), with the following observations:- 4. A new Foreign Trade Policy 2015-20 was announced on 01.04.2015 incorporating various changes under DFIA Scheme. The FTP for the year 2015-20 provides a frame work and mechanism for increasing export of Indian goods. In order to increase the foreign trade, certain concessions have been accorded to Indian traders. 5. FTP 2015-20 floated a Duty Free Import Authorization Scheme (DFIA) to regulate export viz-a-viz import of the goods. It is a post export scheme which gave exemption from basic custom duty while importing specified inputs. The design of the scheme is like, the merchant/export trader, has to file on-line application to the concerned regional authority before exporting the goods under DFIA scheme. It is stipulated that export shall be completed within the span of twelve months from the date of generation of particular file number. On completion of export and realization of proceeds, one has to apply for issuance of DFIA with the concerned authority. On each transaction, separate DFIA is issued as per the Standard Input Output ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n licence. In its absence, any addition of words cannot be imported to change the equation. Precisely, import of popcorn maize is not excluded from the scope of term maize . 16. We see no reason to take a different view to take away the benefits otherwise available under the DFIA Scheme under the Foreign Trade Policy, whether of 2009-14 or 2015-20, merely to satisfy the petitioner. According to us the aforesaid judgments of the Punjab and Haryana High Court and Bombay High Court still hold the field, so far as permitting duty-free imports under DFIA are concerned. The contention of the petitioner that duty free import of any goods under DFIA cannot be permitted unless each of the abovementioned three essential conditions are satisfied, clearly runs counter to the above judgments which are binding on the authorities. Neither the officers of the respondents can be proceeded against for following such binding precedents nor can the exporters or importers be subjected to any onerous conditions, declaration, bond or undertaking contrary to these binding precedents, which if taken would be non-est. 17. In that view of the matter there is no merit in any of the prayers of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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