TMI Blog2022 (5) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... n precedent but would have caused any major inconvenience to the Department. In the present case, there is nothing brought on record by the Department as to what administrative inconvenience would have been caused to the Department. There is no denial to the fact that the adoption of the impugned procedure was very much recent introduction at the relevant time of impugned bill of entries. The said condition was not required to be followed since the year 2003 till the year 2017. There is nothing on record to show that the exemption as claimed, irrespective in the absence of the said procedure, there is any element of fraud has been committed by the appellant. In such circumstances, it cannot be ruled out that the non observance of the impugned condition was mere lack of knowledge of the amendment as was introduced vide notification no. 68/2017 that too in June 2017 (the impugned bill of entries are of year November 2017 to January 2018). The procedural condition of Rule 5 of the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 were not at all the substantive condition but was merely a technical condition. Apparently the benefit of exemption from customs duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... favor of appellant. - CUSTOMS MISCELLANEOUS APPLICATION NO. 50619 of 2021 in CUSTOMS Appeal No. 50959 OF 2020 - FINAL ORDER No. 50369/2022 - Dated:- 18-4-2022 - Ms. RACHNA GUPTA, MEMBER (JUDICIAL) Mr. Rajesh Chibber, Advocate for the appellant Mr. Ishwar Charan, Authorised Representative for the Respondent ORDER Present appeal has been filed to assail the order in original no. 07/2020 dated 22.5.2020. The facts in brief relevant to the present adjudication are as follows: That the appellant is an importer, a 100% EOU. Appellant filed Bills of Entry for clearances for re-import of goods having assembly value of Rs.9,95,98,022/- exported earlier on consignment basis as per the shipping bill details in the respective bill of entry. The aforesaid bills were filled under EOU scheme of notification no. 52/2003-Customs dated 31.3.2003. The appellant also claimed simultaneous exemption under notification no. 95/2017-Cus dated 30.6.2017. Department formed an opinion that the exemptions as claimed are inadmissible to the appellant for the want of the procedure under notification no. 59/2017 as stands amended vide notification no. 68/2017 dated 30.6.2017. The Departm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so proximate in time that it was not in the notice of the appellant. Hence, non compliance was not at all intentional. It is further submitted that otherwise also the compliance of the procedure under the said rule was not so crucial so as to deny the substantial benefit of duty exemption to the appellant. Learned Counsel has laid emphasis on the decision in the case of Mangalore Chemicals Fertilizers Ltd. vs Deputy Commissioner reported as 1991 (55) ELT 437 (SC) and in the case of Transformers Electricals Kerala Ltd. vs Collr of Cus. Cochin reported as 1995 (78) 682 (Tribunal). 6. With respect to another reason for denying the benefit to the appellant i.e. the requirement of goods to be manufactured, Learned Counsel has submitted that Department has wrongly considered the goods to not to be manufactured by the appellant. It is submitted that while replying show cause notice appellant has specifically mentioned that the items which were imported by the appellant (post initial export) were got unpacked, clean and repacked before those were re-exported by the appellant. It is impressed upon that activity of repacking amounts to manufacture. Reliance has been placed upon own c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported goods despite that the procedure as incorporated in notification no. 52/2003 w.e.f. 30.6.2017 under which said exemption was claimed was not followed by the appellant. ii) Whether the condition that the goods to be re-exported have to be the manufactured goods has been fulfilled by the appellant. 10. With respect to first point of adjudication, it is foremost necessary to look into the procedure which was to be complied with by the appellant under notification no. 42/2003 as amended vide notification no. 68/2017. Condition no. 2 of the said notification has come into effect from 30.06.2017 which require the compliance of Rule 5 of Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017. The same reads as follows: The importer who intends to avail the benefit of an exemption notification shall provide information 11. (a) in duplicate, to the Deputy Commissioner of Customs or, as the case may be, Assistant Commissioner of Customs having jurisdiction over the premises where the imported goods shall be put to use for manufacture of goods or for rendering output service, the estimated quantity and value of the goods to be imported, particulars of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pliance of the said procedure irrespective it was a condition precedent but would have caused any major inconvenience to the Department. No doubt, there has been the adjudications, by Hon ble Apex Court, as relied upon by the learned DR and have also been mentioned in the order under challenge that the notifications extending exemptions must be given strict interpretation but the concept of interpretation of statute has also been clarified by the Hon ble Apex Court itself in the case of Mangalore Chemicals Fertilizers Ltd. (Supra) wherein it has been held that whenever there has been a condition precedent for seeking condition or a refund the distinction has to be made between a procedural condition of a technical nature and a substantive condition. The Hon ble Apex Court while creating distinction in both kind of procedural conditions has held that non observance of the condition of a technical nature is always condonable. However, the non compliance of substantive condition is not as it may likely to facilitate commission of fraud and introduce administrative inconveniences. In the present case, there is nothing brought on record by the Department as to what administrative inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the goods in question were initially exported by appellant, which for some reason, have been returned back. It is apparent from the record that the appellant while replying to the show cause notice as well as making submission in defence before the adjudicating authority below has specifically mentioned that the goods in question after being imported were stored in 100% Export Oriented Unit and after processing such as cleaning and re-packing that the goods were re-exported. It is submitted that this particular activity satisfies the compliance of all the condition of notification no. 52/2003 read with notification no. 45/2017. As impressed upon by the learned Counsel, the circular no. 489/55/99 dated 13.10.1999 is perused. This circular is admittedly in force. The perusal thereof reveals that the Board has clarified as follows: For the purpose of Rules 12 and 13, the expression Manufacture has very wide connotation. It includes blending, packaging or any other operation. Even if a process do not conform to manufacture under the provisions of Central Excise Act, for the purposes of export benefits, the wider connotation has to be applied. Thus the process of blending, pack ..... X X X X Extracts X X X X X X X X Extracts X X X X
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