9911796707
TMI Blog2024 (12) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... . This is clear from the dictionary meaning of the term 'indelibly', which means, it cannot be removed and cannot be washed away or erased, something which is imperishable. The appellant has deliberately circumvented the compliance of the said condition by merely putting the MRP/RSP on a piece of cloth stitched on one side. This kind of labelling can be easily removed, which implies that the appellant has not complied with the condition in its true spirit as enumerated in the notification. The appellant being a trading concern is regularly importing goods in question, however, without satisfying the pre-condition under the notification, they wrongly claimed the exemption. The attempt on the part of the appellant to justify that registration under the Delhi VAT Act was unnecessary though the notification mandates the declaration of VAT registration number was wilful mis-statement of facts. The failure to declare the TIN number at the time of import violates the conditions of the exemption notification. The appellant also misled the Department that the goods imported are properly marked with the MRP/RSP. Having failed to comply with the mandatory conditions of the notificatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of Notification No.17/2012-Cus. Which explicitly stated: this exemption shall apply only to such footwear on which the retail sale price is indelibly marked or embossed on the footwear itself. (iii) They had not declared their Value Added Tax Registration Number of that State where they intended to sell the imported goods, which is a mandatory condition for availing benefit of notification no.21/2012-Cus dated 17.03.2012. 4. The goods were accordingly seized under Section 110 of the Customs Act, 1962 [The Act] which were provisionally released subject to the conditions. The statement of Shri Yashpal Arora, Proprietor was recorded under Section 108 of the Act on 02.03.2016. 5. Show cause notice dated 26.04.2016 was issued for the period 9.7.2015 to 22.2.2016 and show cause notice dated 2.2.2017 was issued for the period 7.3.2013 to 30.12.2015 (period from 9.7.2015 to 30.12.2015) is common in both the appeals, proposing confiscation of the goods under Section 111 demanding SAD, CVD and Customs Cess along with interest and penalty under Section 112 of the Act. By separate orders dated 26.03.2018 and 14.12.2018, the demand as proposed in the show cause notice was confirmed as the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause notice admits the fact that RSP/MRP was mentioned on the stickers, which was found affixed inside the shoes by stitching. Learned counsel also points out that they had earlier imported such footwear and the clearance thereof was accepted by the Department that retail sale price was indelibly marked on the footwear imported and accordingly, no CVD was demanded in both the show cause notices except the BE dated 11.02.2016. In fact in this regard, it was mentioned that the appellant had requested the Customs Department for embossing RSP on the footwear imported vide BE No.4227461 dated 11.02.2016 before allowing shoes out of charge. He disputed that the demand is arbitrary on account of procedural infirmities. Learned counsel also contested the invocation of extended period of limitation as well as confiscation and the penalty. 9. The learned Authorised Representative reiterated the findings of the Authorities below that the appellant failed to comply with the mandatory conditions of the exemption notification, which required them to declare their Value Added Tax (VAT) Registration Number and hence they were liable to pay the SAD on imports. The learned Authorised Representative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le, when imported into India, from so much of the additional duty of customs leviable thereon under sub-section (5) of section 3 of the said Customs Tariff Act, as is in excess of the amount calculated at the standard rate specified in the corresponding entry in column (4) of the Table aforesaid: Provided that in respect of the goods specified in S. Nos. 2, 46, 70, 87 and 98, imported on or after the 1st day of May, 2012, the exemption contained herein shall apply if the importer, declares,- (i) the State of destination where such goods are intended to be sold for the first time after importation on payment of value added tax; and (ii) his value added tax registration number in that State. 12. The Notification No.32/2012 dated 08.05.2012, amended the Notification No. 21/2012, inter-alia providing as under: In the said notification, I . in the proviso, for condition numbers (i)and (ii), the following shall be substituted, namely:- (i) the State of destination namely the State where the goods are intended to be taken immediately after importation, whether for sale or for distribution on stock transfer basis; and (ii) his VAT (Value Added Tax) registration number or Sales Tax registra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to be read with sub-clause (i) of the Notification so as to ascertain the intent behind the condition to declare the VAT registration. The whole purpose behind the two sub-clauses is to link the goods which are imported and are intended to be sold in the state of destination. Thus the condition of declaring the VAT registration number is not merely a procedural requirement, which can be ignored rather, it makes the entitlement to exemption subject to the condition that the VAT registration number is declared. The submission of the learned Counsel that the appellant had got the TIN number on 26.02.2016 under Delhi VAT Act, has no merit as on the date of filing the bill of entry dated 11.02.2016, the appellant was not registered with the Delhi VAT Department. The fact that they subsequently obtained the registration will not entitle them to avail the exemption of SAD under the notification which makes it a pre-requisite condition for the applicability of the exemption. 14. We may now consider the other allegation of non-compliance with the condition specified in the Notification No.12/2012-CE dated 17.03.2012, so as to avail the benefit of exemption from payment of CVD, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the term 'indelibly' with the expression marked or embossed is obvious that there is no possibility to remove the MRP/RSP. This is clear from the dictionary meaning of the term 'indelibly', which means, it cannot be removed and cannot be washed away or erased, something which is imperishable. In simple words, the legislature has consciously used the term 'indelibly' to mark the MRP/RSP so as to avoid any tampering with the MRP/RSP declared. The appellant has deliberately circumvented the compliance of the said condition by merely putting the MRP/RSP on a piece of cloth stitched on one side. This kind of labelling can be easily removed, which implies that the appellant has not complied with the condition in its true spirit as enumerated in the notification. In this regard, we are supported by the purposive test laid down by the Apex Court in Mangalore Chemicals Fertilizers Ltd. Vs. Deputy Commissioner [ 1991 (55) ELT 437] with reference to the non-compliance of the conditions, Its stringency mandatory nature must be justified by the purpose intended to be served. We are, therefore of the view that the appellant having failed to comply with the conditions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Ltd. (supra), the Apex Court held that a distinction between provisions of the statute which are of substantial character and were built in with certain specific objectives of policy on the one hand and those which are merely procedural and technical in their nature must be clearly distinguished. 18. The plea of revenue neutrality taken by the appellant is also not sustainable as the refund against SAD under notification No. 102/2007-Cus dated 14.09.2007 is not automatic but subject to proper scrutiny and procedure. The decisions cited by the appellant in the case of India Foil Ltd v CCE [2002(145)ELT 238(Tri-Kol)] and PTC India Ltd v CCE [ 2003(159)ELT 1046(Tri. Del) ] are distinguishable in view of the fact that the present case is involved under the exemption Notification, which stands on a completely different footing from the Modvat Credit Scheme under which the issue of revenue neutrality has been considered in the above two cases. 19. Applying the principles of interpretation of the exemption notification as laid down in various judgements, the contents thereof have to be construed strictly. The Constitution Bench of the Apex Court in Commissioner of Central Excise, New De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty seeks the benefits of an exemption clause that are important. Substantial compliance with an enactment is insisted, where mandatory and directory requirements are lumped together, for in such a case, if mandatory requirements are complied with, it will be proper to say that the enactment has been substantially complied with notwithstanding the non-compliance of directory requirements. In cases where substantial compliance has been found, there has been actual compliance with the statute, albeit procedurally faulty. The doctrine of substantial compliance seeks to preserve the need to comply strictly with the conditions or requirements that are important to invoke a tax or duty exemption and to forgive non-compliance for either unimportant and tangential requirements or requirements that are so confusingly or incorrectly written that an earnest effort at compliance should be accepted. The test for determining the applicability of the substantial compliance doctrine has been the subject of a myriad of cases and quite often, the critical question to be examined is whether the requirements relate to the substance or essence of the statute, if so, strict adherence to those requiremen ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
