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TMI Blog2001 (8) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... t to be used in India but are to be exported, then the benefit of exemption notification would not have been granted. By not disclosing the correct fact that the goods were meant for re-export, the benefit of exemption was availed of. In our opinion, therefore, the provisions of the proviso to Section 28(1) was applicable and the show cause notice issued by the customs authorities on 6th April, 1993 was valid. Further this is not a case of mere failure or negligence on the part of the exporter, it was clearly a design on its part to import and then export. Appeal allowed. - 6069 of 1999 - - - Dated:- 14-8-2001 - B.N. Kirpal and Shivaraj V. Patil, JJ. [Judgment per : Kirpal, J.]. - The main question which arises for consideration in the present case is whether the show cause notice which was issued by the appellant to the respondent beyond the period of one year of the import of the items in question is covered by the provisions of Section 28(1) proviso of the Customs Act, 1962 (for short "the Act") and, therefore, within time. 2.Briefly stated the facts are that on 19th October, 1988 the respondent imported and cleared 55 units of Haemodialysers under the Open General ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not have been validly exported and the penalty levied was upheld. The Court also noticed the contentions on behalf of the Revenue regarding the import of goods free of duty by relying on the said Notification and in this respect it observed as follows : "25. .... (1) Much emphasis has been laid by the counsel for the Revenue on the circumstance that the appellant had obtained the import of the goods free of duty by relying on the notification granting exemption from customs duty. It is obvious that it could not have been the intention of the legislature to grant exemption from customs duty in respect of vital goods of the nature in question in order that an importer may make profit by selling them abroad. The notification is, therefore, relevant for the issue before us to the limited extent that it lends supports to the construction of List 2 of Appendix 6 in the manner we have interpreted it. This apart, we are not concerned here with the questions whether the attempt of the assessee to export the goods (which has, in the event, been successful) would amount to an infringement of the conditions permitting the import so as to render either the import itself [vide S. 111(o) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n can be gathered from the construction of the words of the notification or by necessary implication therefrom the matter is different, but that is not the case here. ....." (Emphasis added) 9.It is, therefore, clear that if on construction it necessarily follows that the goods though imported under OGL were to be used only in India then such a construction could be properly placed. In this regard, it will be useful to refer to the observations of this Court in M.J. Exports' case (supra) at page 171 which are as follows : "22. We are, therefore, of the opinion that, although there is no express prohibition, the re-export as such of items of goods specified in List 2 and imported into India is prohibited by necessary implication by the language of, and the scheme underlying, the grant of OGL in regard to them. It is difficult to agree that the import-export policy envisages the re-export of goods belonging to this category. The opinion of the CCIE is also to the same effect. The opinion also derives some binding effect from Para 24(1) of the Import Policy read with Paras 22 23 of the Export Policy, which say : Para 24(1) : The interpretation given by the Chief Controller of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been no wilful suppression on the part of the respondent. The law as it then stood enabled the importer to take the benefit of the exemption notification and the larger period of limitation would, therefore, not be applicable. In support of this contention, reliance was placed on the decisions of this Court in Padmini Products v. Collector of C. Ex., 1989 (43) E.L.T. 195 (S.C.) and Collector of Central Excise, Hyderabad v. M/s. Chemphar Drugs and Liniments, Hyderabad, 1989 (40) E.L.T. 276 (S.C.) = 1989 (2) SCC 127. We are of the opinion that these decisions can be of little assistance to the respondent. From what has been stated hereinabove, it must follow, logically, that inherent in the import of the life saving equipment was the condition that the same had to be used only in India. That condition also stood attached to the terms of Exemption Notification No. 208/1981. There was an obligation on the respondent not to claim exemption on the import so made if the respondent intended to export the life saving equipment to Russia. There can be little doubt, and the examination of the respondent's Director makes it very clear, that the equipments were imported from abroad solely w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t were "free goods or India produce to be exported or India produce". The appellant did not strike off any of these descriptions as inappropriate. The customs authorities were given the impression that these were Indian goods that were being exported. Indeed, the appellant itself well knew that goods imported could not be exported as such without the performance of some operation of processing or manufacture in regard to them. That is why it put up a facade of taking the goods to Ankleshwar after their import allegedly for being subjected to some processes. The customs officers, on verification, found that all this was untrue and that the appellant was surreptitiously trying to export imported goods, after just repacking them as goods of Indian manufacture. The appellant had adopted a similar subterfuge on the earlier occasion in December 1987 and succeeded in exporting like goods by not striking out the appropriate columns of a shipping bill proforma which required the exporter to specify whether the goods were "Indian produce or foreign produce to be re-exported". It is, therefore, urged that the goods sought to be exported do not conform to the description in the bill of entry f ..... 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