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TMI Blog2024 (12) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... 2-CE dated 17.03.2012. They had also not paid the Special Additional Duty [SAD] of customs by claiming exemption under Sl.No.2 of the Table in Notification No.21/2012-Cus dated 17.03.2012. 3. On the basis of intelligence regarding wrongly claimed exemption, the goods were examined and it was found that :- (i) the total number of packets and shoes packed therein were tallied with the declaration made by the importer in BE, invoice and packing list. (ii) RSP/MRP was mentioned on the stickers affixed inside the shoes by stitching which neither could be termed as embossed nor indelibly marked on the shoes itself. Thus, it appeared that they had not satisfied the mandatory condition mentioned at Sl.No.15 of the conditions 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 seiz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore provisional release of the goods and before the issuance of the show cause notice, there is no contravention of the provisions of the notification. On the other issue, learned counsel submitted that the MRP was indelibly marked on the footwear permanently affixing by stitching, which was apparently visible. Learned counsel also submitted that in case SAD was paid, the same is refundable on clearance of imported goods vide notification no.102/2007 dated 14.09.2007. He, therefore, relied on the principles of revenue neutrality. The CVD was demanded only in respect of the BE No.4227461 dated 11.02.2016, which is the subject matter of the show cause notice dated 26.04.2016. In this regard, learned counsel submitted that the show cause 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 wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 3, Sub-section (i), vide number G.S.R. 92 (E), dated the 1st March, 2006, and No. 29/2010-Customs, dated the 27th February, 2010, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 92 (E), dated the 27th February, 2010, except as respects things done or omitted to be done before such supersession, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the goods of the description specified in column (3) of the Table below, falling within the Chapter, heading, sub-heading or tariff item of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as are specified in the corresponding entry in column (2) of the said Table, 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 her ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g exemption under the notification issued in terms of Section 3(5) of CTA and, therefore, it is necessary to comply with the conditions enumerated in the said notification. The appellant cannot pick and choose what is beneficial to him but at the same time discard the conditions enumerated in the notification, which entitles them to the exemption. If the appellant chooses to seek the exemption under the notification, they are bound to comply with the conditions specified therein. The condition to declare the value added registration number in that State has been couched in a manner, which makes its compliance mandatory, i.e., the exemption contained herein shall apply if the importer, declares his value added tax registration number in that State. Moreover, sub-clause (ii) 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 mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, local or otherwise, freight, transport charges, commission payable to dealers, and all charges towards advertisement, delivery, packing, forwarding and the like, as the case may be, and the price is the sole consideration for sale. Nil 15 Condition No.15 This exemption shall apply only to such footwear on which the retail sale price is indelibly marked or embossed on the footwear itself. 15. There is no dispute that the footwear imported by the appellant was having MRP less than Rs.500 per pair and hence they were exempted from payment of excise duty subject to the condition that the retail sale price is indelibly marked or embossed on the footwear itself. The requirement under Condition No.15 is not merely that it should be marked or embossed in any manner but that it should be indelibly marked or embossed. The intent behind incorporating 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 legis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not alter or amend the law. It can only interpret the provision to make it meaningful and workable so as to achieve the legislative object, when there is vagueness, ambiguity or absurdity. The purpose of interpretation is not to make a provision what the Judge thinks it should be, but to make it what the legislature intended it to be." 17. The submission of the learned Counsel that benefit cannot be denied on procedural infirmities when there is substantial compliance of the provisions is devoid of any merit as we have already concluded that the conditions of the notification violated by the appellant are mandatory. Therefore, reliance placed by the learned Counsel on the decision in Transformers and Electricals Kerala Ltd vs. CC [1975(78) ELT 682 (T)] and Webel Telematik Ltd vs. CC [1995(80) ELT 617 (T)] are not applicable. In Mangalore Chemical & Fertilizers 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 ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve the object and purpose of the rule or the regulation. Such a defence cannot be pleaded if a clear statutory pre-requisite which effectuates the object and the purpose of the statute has not been met. Certainly, it means that the Court should determine whether the statute has been followed sufficiently so as to carry out the intent for which the statute was enacted and not a mirror image type of strict compliance. Substantial compliance means "actual compliance in respect to the substance essential to every reasonable objective of the statute" and the Court should determine whether the statute has been followed sufficiently so as to carry out the intent of the statute and accomplish the reasonable objectives for which it was passed. Fiscal statute generally seeks to preserve the need to comply strictly with regulatory requirements that are important, especially when a party 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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