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2023 (9) TMI 462 - AT - CustomsPreferential rate of duty - Imports of ‘gold jewellery’/ ‘diamond studded gold jewellery’ effected from Thailand - Benefit under notification no. 85/2004-Cus dated 31st August 2004 claimed - collusive arrangement of buyer and seller - validity of certificates of origin - HELD THAT:- Preferential rates are accorded through deliberate policy making and from bilateral/multilateral engagement; these deviations from standard rates are usually attended by comprehensive means of ascertainment and verification. Assigning of rates of duties chargeable on imported goods is a legislative function of the State. As the custodian of ‘ways and means’, it is the government that is responsible and accountable for dilution of such rates in public interest which reflects tax policy or exigency of international cooperation and the latter emerging from calibrated negotiations culminating in trade and economic agreements. In the present case, the issue is restricted to the rate chargeable under the authority of section 12 of Customs Act, 1962 without foraying at all into the classification and valuation aspects. It is of essence that, in such determination, the usual presumptions built into the assessment system are eschewed for strict adherence to the scheme of preferential rate – else policy formulation at the governmental level will be held to ransom by the statics of administration of tax which is averted to the application of rules for classification incorporated in Customs Tariff Act, 1975 and that for valuation in Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. The Operational Certification Procedure is not only elaborate but also sets out details that can lead to rejection of certificate for non-conformity. It is not the case of Revenue that these are a remote possibility. Rule 15 of Interim Rules of Origin is unambiguous about the procedure for retroactive check of the certificates and the circumstances prompting the same - turning to the response of the Department of Foreign Trade, Thailand dated 31st July 2014 that has been referred to in the arguments of Learned Authorized Representative, It appears that a different construction has been placed on the report supra by First Secretary (Economic & Commerce) in communication of Embassy of India, Bangkok dated 13th August 2014 restricting the authentication to 59 of the certificates while a plain reading of the parent report appears to authenticate all the certificates while advising on apparent ineligibility of these 59 certificates for some non-compliance. This misinterpretation by the overseas mission appears to have informed the proceedings culminating in the impugned order. That, however, does not suffice to negate the entirety of the certificates or even the 59 in the absence of details for computation of the ‘local value added content’ in rule 6 of Interim Rules of Origin. In M/S R.S. INDUSTRIES (ROLLING MILLS) LTD., SHRI R.S. PATODIA, DIRECTOR AND SHRI MAHESH CHAND GUPTA, M.D. VERSUS CCE, JAIPUR – I [2017 (11) TMI 1256 - CESTAT NEW DELHI], it has been held that in the presence of valid certificates of origin issued by Competent Authority, the assessing authorities in India are not right in denying the benefit of exemption notification. There are no justification for discarding of the ‘certificates of origin’ by the adjudicating authority - impugned order set aside - appeal allowed.
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