TMI Blog2022 (10) TMI 331X X X X Extracts X X X X X X X X Extracts X X X X ..... imed the said benefit and ignorance of law is not a ground to claim the benefit as that of exemption - Hon ble Apex Court in the case of Share Medical Care vs. Union of India [ 2007 (2) TMI 2 - SUPREME COURT] has held that where the appellant is entitled to benefit under two different Notifications, he can claim more benefit and it shall be the duty of the authorities to grant such benefit provided. Hon ble Apex Court also clarifies that even if applicant does not claim benefit under a particular notification at initial stage, he is not debarred, prohibited or estopped from claiming such benefit at a later stage - It was held that even the appellant does not claim the benefit under a particular Notification at the initial stage, he is not debarred, prohibited or estopped from claiming such benefit at a later stage - The benefit of said Notification has to be extended in favour of the appellant. Such benefit has wrongly been denied on the ground it being claimed belatedly. The order under challenge is not sustainable on this count. Levy of penalties - HELD THAT:- Penalties can be imposed only in the case where there had been intentional malafide on the part of the assessee - t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 017 dated 30.6.2017 the show cause notice bearing No.8097 dated 23.10.19 was served upon the appellant proposing the duty demand of Rs.1,26,09,230/- along with the interest amounting to Rs.7,22,406/-. The amount which was deposited by the appellant vide Challan No. 1894 dated 02.03.2019 was proposed to be appropriated against the total demand amount. Penalty was also proposed. The proposal, as such, has been confirmed vide the Order-in-Original bearing No. 71/19-20 dated 16.06.2020. Being aggrieved, the appellant is before this Tribunal. 3. We have heard learned Counsels Shri Kishore Kunal, Manish Rastogi and Ms Kanak Grover appearing for the appellants and Shri Nagender Yadav, learned Authorised Representative appearing for the department. 4. It is submitted by the appellant that they are a manufacturing company in the business of manufacture of mobile phones in India with latest and advanced technology including the PCBA and has been granted the Import Export Code. They are also registered under CGST regime. It is submitted that they also import various electronic and mechanical items and components for the manufacture of such mobile phones and PCBA at their factory. The mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue Authorities and any adjudication order which confirms demand beyond allegations raised in Show Cause Notice, is unsustainable. The rejection on the ground that the availment of exemption notification at an belated stage is also not good in the eyes of law. It is submitted that substantial benefit of exemption Notification can be availed by the assessee at any stage of proceeding. Decision in the case of Share Medical Care vs. Union of India, reported as [2007 (209) ELT 321 (SC)] has been relied upon. It is submitted that otherwise also at the time of import of the impugned microphones, the entry No. 427 was very much in existence, clearly exempting all kinds of micro phones from payment of Customs duty. There is otherwise no dispute in the show cause notice as to the eligibility of benefit of exemption to the appellant under Notification No. 50/2017. Learned Counsel further submitted that the General Rule of Interpretation has not reasonably been the examined by the Adjudicating Authority with the submission that where more than one benefit is available to the importer at the stage of import and even at the subsequent stage of adjudication, it is completely at the option of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted with any microphone but it requires to be fitted with a communication module as it is an integral component for the functioning of the modem. Therefore, these components are different from the component which are used for the purpose as mentioned in of manufacturing the PCBA as mentioned in the Explanation (6) ). 9. It is further impressed upon that From S. No. 18 of the parent notification No. 57/2017-Customs dated 30.06.2017 and S. No.7 18 of the further notification Nos. 22/2018 Customs dated 02.02.2018 and 37/2018 Customs dated 02.04.2018, legislature has made it clear that the microphone is part of cellular mobile phone and classifiable under CTH 8518. Also, it is very clear that no exemption is granted to microphone which is part of cellular mobile phone. The reliance of the adjudicating authority upon the General Rules of Interpretation has also been justified by learned Departmental Representative mentioning that as per Note 3 4 of the Section XVI, it becomes evident that classification of sub-parts will eventually be dependent upon the machine which performs the principal function. In the present case, microphones are serving the purpose of being put to furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fit of duty exemption. 13. From the above observations, the moot controversies for adjudication appears to us are as follows: (i) Whether the impugned goods imported by the appellants (microphones) are the goods which fall under entry at S.No. 6A or are the goods which fall under entry at S.No. 18 of Notification No. 57/2017 dated 30.6.2017? (ii) Whether the benefit of entry No. 427 / list 20 in Notification No. 50/2017 dated 30.6.2017 is or is not available to the appellant? Issue No. (i) To adjudicate the issue, it is foremost necessary to have a glance about both the entries. Entry at S.No. 6A of Notification No. 57 /2017 reads as follows: S.No. Chapter or Heading or sub headings or tariff items Description of goods Standard Rate Condition No. 1 2 3 4 5 6A Any Chapter (a) Inputs or parts for use in manufacture of Printed Circuit Board Assembly (PCBA) of cellular mobile phones Nil 1 (b) Inputs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture of PCBA provided the importer follows the procedure set out in Customs Imports of Goods at Concessional Rate of Duty Rules, 2017. 15. As per entry No. 18 of the said Notification, 10% of duty has to be paid with respect to all goods except three parts of cellular mobile phones, viz., microphones of cellular mobile phones, wired Headset, Receiver of cellular mobile phones. The exemption is not subject to any conditions. There is nothing on record to show that what rate of duty shall apply to microphones of cellular mobile phones, wired Headset, Receiver of cellular mobile phones. However, it stands clear that duty at the rate of 10% as mentioned in entry at Sl. number 18 of Notification 57/2017 is not applicable to microphones of cellular mobile phones. 16. After perusing both these entries, in our opinion, the contention of the Department that entry number 18 of the said Notification applies to the imported goods i.e., microphones is meaningless because even if the microphones are part of cellular mobiles the 10% duty as mentioned in entry No. 18, based whereupon the department has raised demand, is not applicable to microphones of cellular mobiles, these being excluded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exempts microphones by Entry No. 427. It reads as follows:- S.No. Chapter or Heading or sub headings or tariff items Description of goods Standard Rate Condition No. 1 2 3 4 5 427 8485 or 90 The goods specified in List 20 Nil - List 20 (See S. No. 427 of the Table) 1. Ferrite parts including memory cores and ferrite magnets 2. Switches with contact rating less than 5 amperes at voltage not exceeding 250 Volts AC or DC 3. Connectors 4. Microphones /Microphone cartridges 5. Relays of contact rating upto 7 amperes 6. Microwave passive parts 7. (i) Saw filters (ii) Ceramic filter/trap (iii) Delay lines (iv) CRT socket (v) Spark gap 8. Fibre optics and other optoelectronic parts and devices namely, Couplers, Attenuators, Connectors, Splicers, Multiplexers and Demultiplexers 9. Passive optical parts, namely, Microlens and splitters, Micropositioners, Optical filters and gratings and Phase plates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and promoting growth of co-operative sector in the economic life of the country and in pursuance of the declared policy of the Government. The correct way of reading the different heads of exemption enumerated in the section would be to treat each as a separate and distinct head of exemption. Whenever a question arises as to whether any particular category of an income of a cooperative society is exempt from tax what has to be seen is whether income fell within any of the several heads of exemption. If it fell within any one head of exemption, it would be free from tax notwithstanding that the conditions of another head of exemption are not satisfied and such income is not free from tax under that head of exemption. The expression marketing is an expression of wide import. It involves exchange functions such as buying and selling, physical functions such as storage, transportation, processing and other commercial activities such as standardisation, financing, marketing intelligence etc. Such activities can be carried on by an Apex Society rather than a primary society . 22. It was held that even the appellant does not claim the benefit under a particular Notification at the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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