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TMI Blog2022 (5) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... lant for the want of the procedure under notification no. 59/2017 as stands amended vide notification no. 68/2017 dated 30.6.2017. The Department was also of the opinion that the exemption is not available to the appellant for the reason that the goods re-exported were not the manufactured goods of the appellant. With these observations the show cause notice no. 6646 dated 22.10.2019 was served upon the appellant. Proposing denial of exemption from Customs duty and integrated tax as was claimed by the appellant in terms of aforesaid notifications and proposing duty demand of Rs. 58,83,112/- along with demand of Rs.4,23,904/- with interest. Penalties were also proposed to be imposed upon the appellant. The said proposal has been confirmed vide order under challenge except that the demand for Rs.47,38,334/- was dropped. Still being aggrieved the appellant is before this Tribunal. 3. I have heard Shri Rajiv Chibber, learned Advocate for the appellant and Shri Ishwar Charan, Authorised Representative for the respondent. 4. It is submitted by the learned Counsel for the appellant that the appellant had initially exported the goods (jewellery items). The said goods were however returne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported by the appellant. It is impressed upon that activity of repacking amounts to manufacture. Reliance has been placed upon own circular no. 489/55/99-CEX dated 13.10.1999 wherein expression manufacture is held to have very wide connotation to include processes as that of packing. It is submitted that the adjudicating authority has committed an error while ignoring the said circular. Reliance has been placed upon the decision in the case of Bala Handlooms Exports Co. Ltd. vs. Commissioner of C.Ex, Chennai reported as 2008 (223) ELT 100 (Tri-Chennai) and in the case of Keva Fragrances P. Ltd. vs. CCE Mumbai reported as 2015 (325) ELT 903 (Tri-Mum). 7. Both the grounds as have been made the basis by the adjudicating authority to confirm the demand in question against the appellant are therefore mentioned to be the wrong findings. The order under challenge is accordingly prayed to be set aside and appeal is prayed to be allowed. 8. While rebutting the submissions, learned DR has laid emphasis upon the findings in para 4 and 5 of the order under challenge. It is submitted that there is no denial for the non compliance of the procedure mentioned in the notification based whereupon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s or for rendering output service, the estimated quantity and value of the goods to be imported, particulars of the exemption notification applicable on such import and the port of import in respect of a particular consignment for a period not exceeding one year; and 12. (b) in one set, to the Deputy Commissioner of Customs or, as the case may be, Assistant Commissioner of Customs at the Custom Station of importation. 13. (2) The importer who intends to avail the benefit of an exemption notification shall submit a continuity bond with such surety or security as deemed appropriate by the Deputy Commissioner of Customs or 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, with an undertaking to pay the amount equal to the difference between the duty leviable on inputs but for the exemption and that already paid, if any, at the time of importation, along with interest, at the rate fixed by notification issued under section 28AA of the Act, for the period starting from the date of importation of the goods on which the exemption was availed and ending with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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). 15. I am of the opinion that 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 to a 100% EOU is a substantive benefit. Such substantive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port benefits, the wider connotation has to be applied. Thus the process of blending, packing etc. are well covered under Rule 12(1)(b). One problem which comes into the way is that the Notification No. 42/94-C.E. (N.T.), dated 22-9-1994 provides for procurement of goods directly from the factory of manufacture and the open market procurement is allowed only where goods are in original packed condition and the invoices are issued in terms of Rule 57GG (by Registered dealers). In case of tea, condition relating to open market purchase cannot be fulfilled. This condition of Notification 42/94, ibid, can be relaxed under the powers conferred by proviso to Rule 12 (1) to allow rebate of the specific duty on tea." 18. This Tribunal in the case of CCE vs Western Electronics reported as 2000 (116) ELT 181 (Tri) while relying upon the similar circular as mentioned above has held that packing of the goods into different packs amounts to manufacture and while exporting such goods, the activity of packing / repacking entitles the EOU to claim exemption from the customs duty while exporting such repacked goods. Tribunal Chennai also in the case of Bala Handlooms (Supra) held that though the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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