9911796707
TMI Blog2023 (2) TMI 242X X X X Extracts X X X X X X X X Extracts X X X X ..... tion] deals with exemption to specified free gifts, donations, relief and rehabilitation material imported by charitable organizations, Red Cross Society, CARE and Government of India and is reproduced below: "Exemption Notification No. 148/94-Cus-dated 18.07.1994 Exemption to specified free gifts, donations, relief and rehabilitation material imported by charitable organizations, Red Cross Society, CARE and Government of India.- In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods (hereinafter referred to as the said goods) of the description specified in column (2) of the Table hereto annexed and falling within the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), from the whole of the duty of customs leviable thereon under the said First Schedule and from the whole of the additional duty leviable thereon under section 3 of the above mentioned Act subject to the conditions specified in column (3) against each serial number in column (1) of the said Table. TABLE S.No. Description of goods Conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery was gifted free of cost under the bilateral agreement between the Government of India and the European Union. Paragraphs 5 and 6 of the order passed by the Tribunal are reproduced below: "5. We have perused the appeal record and considered the submissions made by both sides. In terms of the Notification No. 148/1994 dated 13.07.1994 (Sl. No. 8), the only condition which needs to be satisfied for the goods to be eligible for duty free clearance is that the goods should be gifted free of cost under a bilateral agreement between Government of India and the Foreign Government. In this regard we have perused the certificate issued by the European Union dated 09.11.1999. The certificate categorically states the plant and machinery under import is meant for the pilot project being set up by the appellant at Muvattupuzha, Ernakulam, Kerala and further that the equipments were supplied free of cost in terms of the bilateral agreement between the Government of India and European Union. After perusal of the said certificate, we are of the view that the goods under import by the appellant satisfied the condition specified in the Notification No. 148/1994. Consequently the goods are entit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... findings recorded by the CESTAT. Prima facie, we are of the view that the findings recorded in para 5 of the order under appeal are certainly unsustainable, for it has been recorded by the CESTAT as a general application of the exemption notification. The relevant circumstances should have been placed before the CESTAT before inviting the findings in this behalf. We believe that the CESTAT ought to be called upon to decide the merits of the appeal filed by the respondent herein and decide the core issue. 13. For the above purpose, the order under appeal is set aside, and the matter is remitted to CESTAT for consideration and disposal afresh as per law within four months from the date of receipt of copy of the judgment." (emphasis supplied) 8. This is how the matter has been placed before the Tribunal. The aforesaid judgment of the High Court was received by the Tribunal on 17.10.2022. 9. Shri Kurian Thomas, learned counsel appearing for the appellant submitted that the finding recorded by the Commissioner (Appeals) that the plant and machinery that was imported in terms of the Agreement was not supplied free of cost is factually incorrect for the following reasons: (i) The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 9. Agro-Processing Component 4 108 747 125 4 980 10. xxxxxxxxx Channeling of funds of the Projects. The EC funds provided to the Government of India as a grant will channoled in total as such to the project. Special arrangements have been established as follows:- a) xxxxxxxxxxx b) the Agro-Processing competent will be transferred to the project by the Government of India as a loan of 4.108 million ECU for the establishment of the KFAPC (15 years -10% -5 years grace), it will consist of 1.6 million ECU, contribution to equity share of farmers societies in paid up capital and company loan of 2.508 million ECU, contribution for equipment, building, miscellaneous; c) out of the Marketing Support and Development component, the Government of India will transfer to the project 0.970 million ECU as a loan (15 years -10% -5 years grace) for the privatization of the KHPDC. It will consist of 0.382 million Ecu as contribution to equity share for farmers societies in KHPDC paid -up capital and 0.588 million ECU as contribution to investments and costs of KHPDC; d) the programme expenses in foreign currency estimated at 4.358 mil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Administrative Provisions) was to be transferred to the Project by the Government of India as a loan of 4.108 million euro, but subsequently an amendment was incorporated on 08.03.2002. The amended clause 3 provides that the Agro-Processing Component was increased from 4.108 million euro to 7.196 million euro and out of this amount, the capital investment cost (85%) was to be provided as a 'grant' and the 'working capital' (15%) was to be provided as a loan to be repaid in a revolving fund. Thus, the plant and machinery, which would be included in the capital investment cost, was provided as a 'grant' which means as a gift. Clause 8 of the exemption notification would, therefore, be satisfied. 17. This factual portion is also reflected from the Certificate dated 09.11.1999 given by the European Union. The Certificate clearly mentions that the plant and machinery was gifted free of cost to the Programme under the bilateral Agreement between the Government of India and the European Union. 18. The Commissioner (Appeals) failed to notice the amendment made in clause 3(b) of Agreement while recording a finding that the plant and machinery was provided on a loan which was to be repai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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