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2017 (9) TMI 674

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..... cessions given to such exporter under the FTP. Export orders are usually placed several months in advance and the price fixed is not variable beyond a point - If an additional levy is imposed, after the acceptance of such export orders, the resultant burden cannot possibly be passed on by the exporter to the buyers outside India. This might lead to the cancellation of such export orders placing the exporter in a piquant situation. The Petitioner-Exporter is not questioning the legislative competence to levy the additional IGST. It is only questioning the applicability of such levy even to imports that are made for fulfilment of export orders that have been placed on and accepted by the Petitioner prior to 1st July, 2017. Also, the Petiti .....

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..... of the input which is physically incorporated in the export product. Imports under the AAS was exempted from payment of (i) Basic Customs Duty, (ii) Additional Customs Duty, (iii) Education Cess, (iv) Anti-dumping duty and (v) Safeguard Duty and (vi) Transition Product Specific Safeguard Duty, wherever applicable. 3. The Advance Authorization licence is issued to a manufacturer exporter or merchant exporter having past export performance in at least two preceding financial years. In the present case, having fulfilled the conditions prescribed in para 4.03 of the FTP, the Petitioner was issued an Advance Authorization. Annexure P4 to the petition lists out the details of the various Advance Authorizations issued to the Petitioner prior t .....

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..... t of its sources causing a working capital blockage. The Petitioner would have to rely upon borrowings as it has already exhausted its overdraft limits with the banks. The prospect of the IGST being ultimately refunded some time in future is of little consolation to the Petitioner who seeks liquidity to discharge the additional levy of IGST failing which its imports will get blocked. 6. According to Mr. Abhishek Rastogi, learned counsel for the Petitioner, the Ministry of Commerce purportedly made a representation to the Ministry of Finance drawing attention to the quandary in which exporters like the Petitioner are placed. He points out that the limited relief that the Petitioner is seeking is in relation to the applicability of the add .....

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..... 2017, the Petitioner would be required to pay the additional IGST which is now been made mandatory by virtue of amendment to Section 3 of the CTA, 1975. He points out that the Petitioner would be able to seek refund of the IGST after completion of its export obligations and, therefore, the Petitioner cannot have any real grievance. He submits that the Ministry of Commerce, represented by the Directorate General of Foreign Trade ( DGFT ), did not offer any significant comments to the writ petition and, therefore, there was no change in the stand of the Union of India either through the Ministry of Finance or the Ministry of Commerce. 10. The working of the AAS is such that, for the import of inputs made by exporter towards fulfilment of e .....

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..... the additional IGST. It is only questioning the applicability of such levy even to imports that are made for fulfilment of export orders that have been placed on and accepted by the Petitioner prior to 1st July, 2017. Also, the Petitioner is seeking to only avail the credit outstanding in respect of advance authorizations issued to the Petitioner prior to 1st July 2017. 13. The Court is of the view that the Petitioner has made out a prima facie case for grant of Prayer (b) in the writ petition, i.e. a direction to the Respondents to allow the Petitioner to continue making the imports under the Advance Authorization licenses issued prior to 1st July, 2017in terms of their quantity and value subject to terms. It is accordingly directed as .....

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