TMI Blog2010 (11) TMI 1013X X X X Extracts X X X X X X X X Extracts X X X X ..... s per Notification No.90/2004-Cus. dated 10.09.2004 against the DFRC Licences submitted by them. The Ex-Bond Bill of Entry was assessed provisionally giving the importers the benefit of the Notification and the goods were cleared by the importer after payment of Additional Duty of Customs. On examination by the lower authorities, they found that the crude palm oil (edible grade), imported by the importer, is not eligible for exemption by availing exemption under DFRC Licences. After entertaining such a view, a show-cause notice was issued to the importer directing them to show cause as to why the benefit of exemption granted from payment of duty by debiting equivalent amount of duty on the strength of DFRC Scrips and TRAs should not be denied to them; the customs duty foregone by the customs be not demanded from them under provisions of Section 28 of the Customs Act, 1962 with consequential interest. The show-cause notice also proposed for confiscation of the crude palm oil cleared by the importer; and penalties under Section 112(a) of the Customs Act, 1962. The appellants, vide their reply dated 24th July, 2007, contested the allegations in the show-cause notice, wherein they had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant is of edible grade is not disputed by the Adjudicating Authority. It is her submission that DFRC Licences produced by the assessee are for vegetable shortening/cream/fats/spray fats . It is her submission that the crude palm oil (edible grade), imported by the appellant, is squarely covered by the term 'vegetable fat' and that 'palm oil', whether crude or refined, is covered by Customs Tariff Head No.15, which is for vegetable fat. She would also draw our attention to letter dated 19.06.2006, which was issued to M/s. Parle Products Pvt. Ltd. wherein it was clarified that vegetable fats and oil such as palm oil, coconut oil, palm kernel oil are one of the inputs, which was required for the manufacture of biscuits. It is her submission that all the DFRC Licences, which have been produced by the assessee before the Adjudicating Authority, were purchased from M/s. Parle Products Pvt. Ltd. It is her submission that the order of the Commissioner of Customs (Appeals), Mumbai in Kamani Oil Industries case clearly covers the issue in favour of the assessee, which was not addressed to by the adjudicating authority. It is also her submission that the adjudica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Grade) imported by the assessee would be eligible for the benefit of Notification 90/2004-Cus dated 10.09.2004 against 7 DFRC Licences produced by the assessee. 7.2. It is undisputed that the DFRC licences produced by the assessee/importer before the authorities are genuine and the said DFRC Licences were purchased by the assessee from M/s. Parle Products Pvt. Ltd., Mumbai. It is also undisputed that the goods, which were imported by the assessee, are crude palm oil (edible grade). Another factual matter which is clear from the records is that the said crude palm oil (edible grade) does not figure in the list of sensitive items, which are listed in 4.31 of the Handbook of Procedure Volume-1 as amended by DGFT/Notice No.4/2002-07 dated 1.4.2002. 7.3. We also find from the records that the DGFT authorities vide letter dated 29.06.2006 had informed M/s. Parle Products Pvt. Ltd. as under:- No.01/85/162/46/AM07/DES.VI/628 Government of India Ministry of Commerce and Industry Directorate General of Foreign Trade Udyog Bhawan, New Delhi-110011 Dated: June 19,2006 To M/s Parle Products Pvt. Vile Parle East, Mumbai-57. Subje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l characteristics and specifications of the inputs under import should be the same as those used in the resultant export product. For this purpose the quality, technical characteristics and specifications of each input used in the resultant export product were required to be specified on the shipping bill and at the time of import Customs was required to co-relate it with the input under import so as to allow DFRC benefit to those inputs which were of the same quality, technical characteristic and specifications. Under the new DFRC scheme such co-relation of quality, technical characteristic and specifications has been done away except in the case of items which are listed in para 4.31 of the Hand book of procedure volume 1 as amended by DGFT/Notice No.4/2002-07 dated 1.4.2002. In respect of such items customs shall continue to ascertain the quality, technical characteristics and specifications of the inputs under import with reference to the quality, technical characteristics and specification of the inputs used in the export product as declared on the shipping bill. Quantity of each input shall be permitted in the DFRC licence in terms of SION for the relevant export product as e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... materials required for packing of resultant product; and (c) fuel. (emphasis supplied) 7.7. It can be seen from the above reproduced General Exemption Notification No.90/2004-Cus. the benefit can be availed by an importer for the materials imported under DFRC licence, even if it is an intermediate. In the case in hand, there is factual finding that the goods imported, i.e. crude palm oil (edible grade) requires refining before it can be put to use for the manufacturing of biscuits, it would get covered under the category of materials as an intermediate . If that be so, the benefit of Notification 90/2004 cannot be denied to the assessee. 7.8. We also find strong force in the submissions of the learned Counsel, that the nexus is not required to be established by the transferee of the licence. It is seen that, in the case before us, it is undisputed that the appellants/importer had purchased DFRC licences from M/s. Parle Products Ltd., there is no need for them to establish the nexus of the goods imported and the consumption thereof in the export of the goods as mentioned in the DFRC. This law has been squarely settled by the co-ordinate bench in the case of Ram ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
