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TMI Blog2025 (2) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... ial subsequent by exported the final products. The Hon'ble Supreme Court in Titan Medical Systems Private Limited vs. Collector of Customs, New Delhi [2002 (11) TMI 108 - SUPREME COURT] held that 'As regards the contention that the appellants were not entitled to the benefit of the exemption notification as they had misrepresented to the licensing authority, it was fairly admitted that there was no requirement for issuance of a licence that an applicant set out the quantity or value of the indigenous components which would be used in the manufacture. Undoubtedly, while applying for a licence, the appellants set out the components they would use and their value. However, the value was only an estimate.' In the instant case also, the licensing authority viz. DGFT has accepted the fulfilment of export obligation and issued 7 Export Obligation Discharge Certificates to the appellant. The 8th was pending at the time of hearing. These EODCs discharge the appellants from any further export obligation. That being the position, the Customs authorities cannot deny the benefit of Customs duty exemption under the notifications governing the Advance Licensing Scheme. The customs autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the appellant vide the Show Cause Notice dated 28.09.2020. The impugned order confirmed the differential customs duty of Rs. 21,43,27,904/- along with interest and penalty of Rs. 50,00,000/- was imposed u/s 112(a)(ii) of the Customs Act, 1962.Aggrieved by the said order, the appellant has filed the present appeal. 3. Learned counsel for the appellant submitted that all the Advance Authorizations issued to the appellant, allowed duty free import of Aluminium Foil - 50 MIC +- 10%. There is no dispute regarding the fact that the goods imported by the appellant were Aluminium Foil 50 MIC+ 10% only. The only dispute relating to the Customs classification of the impugned goods. He contended that appellant has classified the same under CTH 7607 19 91, whereas the department sought to classify the same under CTH 7607 11 90. Consequently, as the AAs allowed duty free import of goods falling under CTH 7607 19 91, and the goods imported by the appellant fell under CTH7607 11 90, the benefit of the Advance Authorization scheme was not available for these imports. 3.1. Learned counsel further submitted that the issue is no more res integra and has been decided in favour of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Ld. Counsel stated that the DGFT office is the nodal authority for granting the Advance Authorization to the exporters and issues the same based on either the SION, Adhoc norms or self-declaration basis, and monitors the completion of export obligation by issuance of Export Obligation Discharge Certificate ("EODC").In this regard, the DGFT vide Policy Circular No. 22 (RE-2008)/2004-2009 dated 18.07.2008 has clarified that classification of inputs provided in the Advance Authorization is only indicative and can be revised / corrected in the Advance Authorization, if the same is objected by the Customs authorities at the time of import. Thus, even in terms of this DGFT clarification, it is clear that classification indicated in the Advance Authorization is only indicative and as long the description of the goods matches with the item actually imported irrespective of the classification, the benefit of the advance authorization scheme should be extended to the importer concerned. 3.3 Ld. Counsel further submitted that Notification No. 18/2015-Cus exempts all materials required for the manufacture of the final goods when imported into India, from the whole of the duty of customs le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing judgements:- * Bhilwara Spinners Limited vs. UOI [2011 (267) E.L.T. 49 (Bom.)] * Reliance Infrastructure Ltd. vs. Commissioner of Customs [2017 (357) E.L.T. 865 (T)] * Marmo Classic vs. Commissioner of Customs [2013 (290) E.L.T. 439 (T)] Accordingly, demand of INR 8,18,72,464/- for imports, under Advance Authorization No. 0510412322 dated 01.11.2019 (INR 4,38,17,030/-) and for Advance Authorization No. 0510413806 dated 06.03.2020 (INR 3,80,55,434/-) is not sustainable. 3.4. Ld. Counsel also stated that the crucial difference between the competing entries, that is CTI 7607 1190 and 7607 1991 is that the former includes those goods which are rolled but not further worked upon and the latter covers those which are rolled but have also been further worked upon. In the instant case, the impugned goods go through a series of processes before importation that include, but are not limited to slitting, annealing and packaging. Since, the said goods are indeed worked upon, they are appropriately classifiable under CTI 7607 1991. The proposal of the department to re-classify them under CTI 7607 1190 is erroneous. Theld. Counsel prayed that the impugned order be set aside in en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judicating authority found that no process beyond annealing and slitting was being carried on the imported goods by them. 4.2 Ld. AR stated that the appellant was not eligible for benefit of exemption from Custom's Duty and Anti-Dumping Duty under Notification No. 18/2015-Cus dated 01.04.2015 against the Advance Authorizations. As per Condition no. 3 of the said Notification, the goods imported by the importer should correspond to the description and other specifications mentioned in the Authorization. In the present case, Ld. AR contended that the actual description of the imported goods and the classification was different from one mentioned in the Authorisation. The demand of duty covers Bills of Entry filed from 01.09.2018 to 14.09.2020 which is well within the period of 02 years limitation u/s 28 (1) of Customs Act, 1962. Non fulfilment of aforesaid condition has led to violation of the conditions of Notification read with policy provisions and therefore rendering goods so imported liable to confiscation under section 111 (o) of the Customs Act, 1962.Consequently, such acts of omission and commission by the appellant had rendered the imported goods liable to confiscation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Commerce and Industry is responsible for formulating and implementing the Foreign Trade Policy for promoting India's exports. The Advance Authorization Scheme is one such scheme under which the appellant has imported the raw material subsequent by exported the final products. We note that the Hon'ble Supreme Court in Zuari Industries Limited vs. Commissioner of Central Excise and Customs [2007 AIR SCW 7313] held as follows:- "Firstly, on the facts we find that the assessee had given to the sponsoring Ministry its entire project report. In that report they had indicated that for the expansion of the fertilizer project they needed an extra item of capital goods, namely, 6 MW captive power plant. In their application, the assessee had made it clear that the fertilizer project was dependent on continuous flow of electricity, which could be provided by such captive power plant. Therefore, it was not open to the Revenue to reject the assessee's case for nil rate of duty on the said item, particularly when the certificate says so. In the judgment of this Court in Tullow India Operations Ltd. this Court held that essentiality certificate must be treated as a proof of fulfilment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reas the officers on the check-post or port and the point of entry and exit, have powers to prevent or detect the illegal exports of goods, and also confiscate the goods attempted to be improperly exported, which includes dutiable or prohibited goods, they do not have powers to question the classification of goods. If a dispute arises as to classification of the goods entitled for the DEPB, the powers for adjudication for penalty or confiscation, in the event of contravention of the provisions of the Foreign Trade (Development and Regulation) Act, 1992, or any Rules or order made thereunder, is with DGFT. Section 12 of the Act provides that powers to impose penalty or confiscation under section 11 of the Act does not prevent the imposition of any other punishment, under any other law for the time being in force. If a person is liable under any other law, which may include the Customs Act, 1962 for levy of penalty or confiscation, the same may be in addition to penalty or confiscation provided under section 11 of the Foreign Trade (Development and Regulation) Act, 1992 and is also in addition to the suspension or cancellation of the licence under the Act." 9. In this context, the L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uarantee and legal undertaking furnished by the appellants after considering the fulfilment of export obligation by the assessee. This Tribunal held as follows : "Once a bank guarantee and legal undertaking has been redeemed by the competent authority and no action is being taken by the competent authority, therefore, we find this finding is not sustainable in view of the decision of the Hon'ble Supreme Court in the case of Titan Medical Systems Pvt. Ltd. (supra). The Hon'ble Supreme Court held that once an advance licence was issued and not questioned by the licensing authority, the Custom authorities cannot refuse exemption on an allegation that there was any misrepresentation. If there was any misrepresentation, it was for the licensing authority to take steps in that behalf." 10. The ratio decidendi laid down in the above judgments applies to the facts of the present case. In the instant case also, the licensing authority viz. DGFT has accepted the fulfilment of export obligation and issued 7 Export Obligation Discharge Certificates to the appellant. The 8th was pending at the time of hearing. These EODCs discharge the appellants from any further export obligation. That bein ..... X X X X Extracts X X X X X X X X Extracts X X X X
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