9911796707
TMI Blog2025 (4) TMI 831X X X X Extracts X X X X X X X X Extracts X X X X ..... Sukhramji Trust, Shri Ramdham Ram Chowki Post: Birai, Tehsil: Baori, District: Jodhpur, Rajasthan - 342 603 (hereinafter referred to as the "Appellant") is a registered religious and charitable trust. The Appellant was gifted two vehicles viz. one "Land Rover Range Rover" and another "Land Rover Defender" from overseas. The vehicles were to be used for philanthropic purposes and not for commercial purposes. Accordingly, the same were cleared without payment of duty on the basis of exemption granted vide Ad-hoc Exemption Order No. 336 bearing F. No. 460/6/95-Cus.V dated 20.12.1995 which was issued by the Central Government under Section 25(2) of the Customs Act, 1962, granting exemption from payment of Customs duty. 3. The Land Rover Range Rover was a 1993 make and the Land Rover Defender was a 1995 make. Both the vehicles were registered in the name of the Appellant-Trust. After eight years of usage, the 1993 Model Land Rover Range Rover, having outlived its utility period, was disposed of by the Appellant as a junk by sale to M/s. Magna Graphics (India) Ltd., Maharashtra in the year 2002. Similarly, the other vehicle, namely, the 1995 Model Land Rover Defender was also disposed o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant has sold the vehicles to them. 6.1. Similarly, it is submitted that the other car viz. Land Rover Defender (1995 Model) had become a junk after usage for twelve years; therefore, it was disposed of in the year 2008 as 'scrap' by sale to Mr. Harvinder Singh Sekhon since the same had outlived its utility period and became a junk in a non-motorable condition. 6.2. It is submitted that the exemption Order No. 336 dated 20.12.1995 restrained the Appellant from transferring, disposing or alienating the 'vehicles' without the permission of the Department of Revenue, Ministry of Finance, New Delhi. However, he contends that the Appellants had not disposed of the said vehicles as 'cars' in a usable condition to the buyers; the vehicles had outlived their utility and therefore, disposed of as scrap. It is therefore contended that as the Ad-hoc Exemption Order dated 20.12.1995 does not restrain disposal of vehicles as scrap, there is no prior permission required for disposal of vehicles which have outlive their utility and become junk. In view of the above, the Ld. Counsel for the Appellants submits that the Appellants have not violated any of the conditions of the Ad-hoc Exemption O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the required spare parts of the vehicles were not available in the Indian market and importation of such spare parts from abroad is also not viable. In such circumstances, the Appellant decided to dispose of the said vehicles. I observe that the disposal of the vehicles as scrap in a non-usable condition cannot be equated with sale of vehicles. 9.1. I also find that the Appellant-organization being a charitable organization, some of the disciples of the Trust came forward to buy the vehicles on payment of some amount, which was used for philanthropic purposes. It appears that the said vehicles were purchased by two of their devotees as memorabilia for the purpose of display. However, I observe that if the purchaser took the risk of purchasing the spares and used it for some time, it cannot be considered that the Appellant has sold the vehicles to them. 10. The Ad-hoc Exemption Order No. 336 dated 20.12.1995 was accorded to the Appellants subject to fulfilment of the following conditions: - (i) shall be used only for the purpose for which it is imported: (ii) shall not be used for any commercial purpose whatsoever: (iii) shall not be sold, disposed of, gifted, loaned, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ok the risk of purchasing the spares and used it as a vehicle for some time, it cannot be considered that the Appellant has sold the vehicle to them. 12. Accordingly, I hold that the Appellants have not violated the conditions of the Notification, as they have not sold the vehicles. Disposing of the vehicles as 'scrap' after they have outlived their utility cannot be considered as "sale of vehicles". Accordingly, I hold that the demand of Customs Duty from the Appellant is not sustainable and hence I set aside the same. 12.1. As the demand of duty is not sustainable, the demand of interest and imposition of penalties on the Appellants is also not sustainable. Accordingly, I set aside the same. 13. I also find that the Appellants have contended that the Show Cause Notice demanding Customs Duty was issued on 16.11.2017, after a period of almost 20 years from the date of duty payment and even considering the date of disposal of the vehicles as scrap, the Notice has been issued beyond the period of 5 years which could be invoked at the maximum for demanding Customs Duty. As the Notice has been issued beyond the period of 5 years, it has been contended by the Appellants that the Show ..... X X X X Extracts X X X X X X X X Extracts X X X X
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