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TMI Blog2023 (2) TMI 618X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 07/2022 dated 23.03.2022. 2. The applicant, vide the aforesaid application, has sought ruling by CAAR, New Delhi on the question of applicability of notification issued under sub section (1) of Section 25 of the Customs Act, 1962, having a bearing on the rate of duty. The basic objective of the application is to seek clarification on issue as to whether the goods sought to be imported namely "Lithium Ion Cell (Captive Consumption - For LED)" merits benefit under Sr. No. 471 of Exemption Notification No. 50/2017-Cus. dated 30.06.2017, as amended by Notification No. 02/2021-Cus. dated 01.02.2021 as part for use in manufacture of LED Emergency Bulb/ Light. 3. The applicant has submitted statement of facts and question of law with the said application, wherein the applicant has, inter alia, mentioned as under: - 3.1 Under the Customs Tariff, Sections and Schedules, there is no restriction or specific inclusion/ exclusion on the variety of LED Bulb/ Lights/ Fittings. Any light or bulb which has the technology of LED, i.e. Light Emitting Diode, shall be classified under the category of LED Bulb/ Light. Therefore, the emergency bulb which has the technology of LED shall be undoubte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sential part of the LED Emergency Bulb. 3.5 For the manufacturing of LED Emergency Bulb, the applicant has been importing "Lithium Ion Cell" for captive consumption as parts of LED Bulb/ Light and has been availing the benefit of Sr. No. 471 of Exemption Notification No. 50/2017-Cus. dated 30.06.2017, as amended by Notification No. 02/2021-Cus. dated 01.02.2021. The said product is declared under CTH 8507 6000 @ BCD 10% while fulfilling the condition for furnishing of Bond under the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 (in short, IGCR Rules). The relevant portion of Notification is as under: "Notification No. 50/2017-Cus. dated 30.06.2017: Exemption & Effective Basic and Additional Customs Duty for specified goods falling under Chapters 1 to 98: TABLE S. No. Chapter or Heading or sub-heading or tariff item Description of goods Standard rate Integrated Goods and Services Tax Condition No. (1) (2) (3) (4) (5) (6) 471. Any Chapter All parts for use in the manufacture of LED lights or fixtures including LED Lamps 5% - 9 Condition :- 9 If the importer follows the procedure set out in the Customs (Import of Goods at Concessional Rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation No. 50/2017-Cus. dated 30.06.2017. Accordingly, the status of the enquiry initiated by the Principal Commissioner of Customs (Preventive), New Delhi was sought from the applicant as well as from the concerned office. Comments on the application were also sought from the concerned Principal Commissioner/Commissioner of Customs, having jurisdiction over Air Cargo Complex (Import), New Delhi and ICD, Patparganj, Delhi. 5. The Principal Commissioner of Customs (Preventive). New Delhi sent their comments vide letter dated 26.04.2022, wherein it was mentioned inter alia that the Li-Ion Cell is not an essential part of LED bulb and it acts as an extra feature for LED Bulbs. Since the benefit of the S. No. 471 of the Notification No. 50/2017-Cus dated 30.06.2017 was granted on the parts for use in the manufacture of LED lights, therefore, being a non-essential part, benefit is not available on Lithium Ion Cell. Further, the exemption notifications are subject to strict interpretation, therefore, benefit of S.No.471 is available for manufacture of LED lights and not for LED emergency light. Therefore, an enquiry was initiated against the M/s H.Q. Lamps Manufacturing Co Ltd and docume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion No. 9. 9. Accordingly, personal hearing was scheduled on 17.05.2022, but was held on 20.06.2022 on the request of the applicant, wherein Ms. Vidushi Subham, the authorized representative of the applicant made her submissions on the matter. The Authority observed that in view of the facts of the case, this application must be considered in two stages, i.e. (i) admissibility of the application, keeping in view the submissions of Principal Commissioner of Customs (Preventive), New Delhi and scope and applicability of proviso (a) to Section 28 (I)-2 of Customs Act 1962; and thereafter if the application is admissible; (ii) discussion regarding the question posed for advance ruling on the basis of submissions made and comments received. 10. On the question of admissibility, it was noted that the applicant has declared Principal Commissioner of Customs, ACC (Import), New Delhi and Commissioner of Customs, Patparganj & Other ICDs including ICD Garhi Harsaru, as the concerned Principal Commissioner/ Commissioner of Customs. However, the applicant has mentioned that a communication was received from the O/o Principal Commissioner of Customs Preventive, New Delhi seeking documents for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 10.3 Be that as it may. in the interest of principles of natural justice, the Authority directed the Secretariat to send a copy of minutes of this Personal Hearing to the Principal Commissioner of Customs (Preventive). New Delhi and the concerned Principal Commissioner of Customs, ACC (Import). New Delhi and Commissioner of Customs, Patparganj & Other ICDs (Garhi-Harsaru) for information and action as deemed appropriate. 11. In response to the Record of Personal Hearing, the Pr. Commissioner of Customs Preventive vide their letter dated 24.06.2022 and 29.06.2022, inter alia, submitted that the question raised in the application was already pending in the applicant's case before their office; that the office of the Pr. Commissioner of Customs Preventive, New Delhi was made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e covered within the ambit of the expression "where the question raised in the application is already pending in the applicant's case before any officer of customs .. ". 13.2 In the instant case, the previous consignment of goods was imported through ICD Garhi-Harsaru, falling under the jurisdiction of Commissioner of Customs, Patparganj & Other ICDs, claiming benefit of Notification No. 50/2017-Cus. dated 30.06.2017, which was cleared finally by the jurisdictional officers, subject to compliance with provisions of IGCR Rules, 2017. Therefore, the question of eligibility of availing the benefits under the said notification is not pending before the assessing officer or the adjudicating authority. In terms of the said IGCR Rules, specific powers are vested with the officers of Principal Commissioner of Customs (Preventive), New Delhi. In exercise of the powers so vested, an enquiry was initiated against M/s H.Q. Lamps Manufacturing Co. Ltd. and documents were sought vide letters dated 07.02.2022 and 21.02.2022. Thereafter, summon were issued to the importer on 29.04.2022 and 10.05.2022. It was submitted that the matter was still under investigation at the time of advance ruling app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded is available for the manufacturer of LED lights only. Therefore, the benefit cannot be extended to LED Emergency lights. 13.5 I have gone through the relevant provisions of IGCR Rules, 2017, particularly rule 7 thereof. I note that the rules are intended essentially to ensure utilization of the imported goods for prescribed purposes and prescribed manner. It is a moot point whether the said provisions cover the authority to revisit the scope of the exemption notification already determined by the jurisdictional port officer. Be that as it may, this Authority is not competent to examine the scope of the said rule 7. and merely notes that at the present juncture, the concerned jurisdictional port officer has allowed availment of exemption notification and the investigation initiated by the Principal Commissioner of Customs (Preventive), New Delhi has not resulted in issue of any show cause notice atleast as yet. 13.6 On the basis of the careful examination of the relevant provisions of the Customs Act, Rules and CAAR Regulations, 2021, I am on the considered view that an application may be considered "pending" before any officer of customs only if it is pending before an offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rict interpretation of the exemption notification, being in the nature of delegated legislation. I also respectfully note that ambiguity in exemption notification should be interpreted strictly, even as it is obvious that the said judgement should not be relied upon by the executive to envision ambiguity where none exist. 14.3 Following the said principle, I find that the eligibility under the exemption notification, which covers "all parts for use in manufacture of LED lights or fixtures including LED lamps" can be decided by answering the following three questions, which I proceed to do sequentially. 14.4 The first question is whether a LED Emergency light is a LED light? The AR of the applicant has submitted that the LED emergency bulb is a value-added category of LED bulb, and as per common parlance and technology used in the device, the LED Emergency bulb is an LED bulb. I note that it is in the nature of commercial progress that value added goods are envisioned and supplied in the market. While it is possible to restrict the scope of any goods to exclude value added sub-category thereof under any statute, particularly taxation statute, in the absence of such explicit exclus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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