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TMI Blog2023 (9) TMI 86X X X X Extracts X X X X X X X X Extracts X X X X ..... of origin. The Customs Authority of Government of India must request the Issuing Authority i.e. in the present case the Malay Chamber of Commerce Malaysia to check the authenticity of the certificate of origin. It is found that the department, when made an allegation about the country of origin did not follow the procedure prescribed under Rule 9 of Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of the Republic of India and Malaysia) Rules 2011. Therefore, merely on the basis of the bill of lading whereby, it was inferred that the goods were originated from China cannot be accepted. Under the identical scheme of import of goods based on certificate of origin this tribunal in the case of M/S. BDB EXPORTS PVT. LTD., SHRI NIRMAL KUMAR BHURA VERSUS COMMISSIONER OF CUSTOMS (PREV.) , WEST BENGAL, KOLKATA [ 2016 (9) TMI 1087 - CESTAT KOLKATA] has held that Certificates of origin issued by the designated authority under SAPTA cannot be rejected which is the only requirement for the satisfaction of the Customs department under Notification No.105/99-Cus dated 10.08.1999. Thus, without checking the authenticity of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referential Trade Agreement between the Governments of The Republic of India And Malaysia) Rules 2011. 2.1 He submits that if there is any reasonable doubt the customs authority of the importer country is required to make a request to the issuing authority of the exporting country to perform retroactive check regarding authenticity of the certificate of origin or as to the accuracy of the information regarding the true origin of the goods in question. However, this mandatory provision has not been followed, therefore merely on the basis of the bill of lading the allegation that the goods is of the China origin cannot be sustained. 2.2 He submits that even in case of any doubt the departmental officer cannot sit as an Adjudicator over the certificate of origin issue by the designated authority, that certificate of origin cannot be questioned on the basis of statements of the importers and after establishing by following the procedure the certificate origin needs to be cancelled, which was not followed by the department in the present case, in support of submission he placed reliance on the following judgments: M/s. BDB Exports Pvt. Ltd., 2017 (347) ELT 662 (Tri.-Kol) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referential Trade Agreement between the Governments of the Republic of India and Malaysia) Rules 2011. Therefore, merely on the basis of the bill of lading whereby, it was inferred that the goods were originated from China cannot be accepted. 4.2 Moreover, the discrepancy was noticed only in respect of bill of lading related to 2 certificate of origin. Therefore the allegation in respect of other 3 certificates of origin is without any basis. Under the identical scheme of import of goods based on certificate of origin this tribunal in the case of M/s. BDB Exports Pvt. Ltd (supra) has taken the following view: 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 per Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ption 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 observ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty 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, Madhya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es 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 issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed from outside 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. 92 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pute. We already note that the certificate were not recalled or cancelled by the issuing authority. The only ground for denial of exemption is, the Zinc Ingots value subjected to assessment by Sri Lankan customs appears to be low. For this, support was drawn from LME price. We note that assessment of import of ingots was made by Sri Lankan Customs. The same cannot be varied here. We find it is not open to counterpart in India to reassess the goods which are not imported into India. 6. In any case, para 38.3 of the impugned order refers to non-fulfilment of condition under Rule 7(a) of Origin Rules. Reliance was placed on reports given by Sri Lankan customs dated 31-12-2004, 8-2-2005 and 5-4-2005 to conclude that the domestic value addition is not fulfilled. We have perused all the three reports which are on record. We note that none of these reports by Sri Lankan customs give any indication about the value addition not being fulfilled by the Sri Lankan supplier. To this extent, there is no factual support for the observation made in the impugned order. Further, we note that the valuation of Zinc Ingots as ascertained by the impugned order has no relevance to question the certi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stoms leviable thereon as is in excess of the amount collected at the rate specified in column 4 of the said table, when the goods imported into the Republic of India when the goods from a Country listed in Appendix I. As already observed above, Indonesia is one of the country from Appendix I. 6. Further perusal of the Notification shows that such benefit is available to the importer if the importer proves to the satisfaction of the Deputy Commissioner or Assistant Commissioner of Customs, or as the case may be, that the goods in respect of which the benefit of this exemption is claimed are of the origin from the countries as mentioned in Appendix I or Appendix II, as the case may be], in accordance with provisions of the Customs Tariff Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of Member States of Association of Southeast Asian Nations (ASEAN) and the Republic of India] Rules, 2009, published in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 189/2009-Customs (NT), dated the 31st December 2009. 7. I further observe that this Notification is an amendment of earlier Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party shall accept the AIFTA Certificate of Origin and grant the preferential tariff treatment if the clarification is found satisfactory. 8. Apparently and admittedly, the Customs Authority while verifying the origin of goods had issued a questionnaire and denied the benefit on the ground that the complete questionnaire was not answered by the appellant creating a doubt about the Country of origin Certificate. The perusal of the condition No. 7 (c), as above makes it clear that in case of such doubt about the authenticity of Country of origin Certificate i.e. in case where the certificate of origin is not acceptable to the Customs Authorities of the importing country, then the certificate has to be returned back to the issuing authority that too within a reasonable period duly informing the grounds for the denial of preferential tariff treatment. Admittedly and apparently, the said procedure has not been followed by the Department. Though all the questions were not answered by the appellant but perusal of the questionnaire shows that the availability of information as was required under these questions was not feasible with the appellant. More so, appellant had handed over t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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