M/S R. R. Kobler Overseas Pvt. Ltd vs Cc, Icd, Tuglakabad, New Delhi

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

Customs Appeal No. 9 of 2010

(Arising out of order-in-appeal No. CC(A)Cus./ICD/31/2009 dated 15.10.2009 passed by the Commissioner of Customs (Appeals) New Delhi).

M/s R. R. Kobler Overseas Pvt. Ltd. Appellant

Vs.

CC, ICD, Tuglakabad, New Delhi Respondent

Appearance:

Shri V. R. Sethi, Advocate for the appellant-assessee

Sh. Ranjan Khanna, DR for the Revenue

Coram:

Honble Mr. Justice G. Raghuram, President

Honble Mr. R. K. Singh, Member (Technical)

Final Order No. 53129 / 2015

Per: R. K. Singh:

Appeal has been filed against order-in-appeal dated 15.10.2009 which upheld the order-in-original dated 19.08.2009 in terms of which it was ordered that the duty be charged on goods imported vide Bill of Entry No. 505835 dated 28.03.2008 along with interest at applicable rate. The importer was directed to pay duty along with interest within seven days of the order-in-original failing which the Bank Guarantee was to be enforced.

2. Facts of the case, in brief, are as under:

The appellant was a 100% EOU and exported leather pouches. However, the said leather pouches were reimported duty free vide Bill of Entry No.505835 dated 28.03.2008 for repair etc. under Notification No. 158/1995-Cus. dated 14.11.95. The exemption under Notification No. 158/95-Cus. was subject to the following conditions:

i) Such re-importation takes places within 3 years from the date of exportation.

ii) Goods are re-exported within six months of the date re-importation or such extended period not exceeding a further period of six months as the Commissioner of Customs may allow;

iii) The Assistant Commissioner of Customs or Deputy Commissioner of Customs is satisfied as regards identity of the goods;

iv) The importers at the time of importation executes a bond undertaking to:-

a) Export the goods after repairs or reconditioning within the period as stipulated;

b) Pay, on demand, in the event of his failure to comply with any of the aforesaid conditions, an amount equal to the difference between the duty levied at the time of re-import and the duty leviable on such goods at the time of importation but for the exemption contained herein.

3. The appellant has contended that goods were reimported within 3 years from the date of report. The goods after repair were re-exported on 13.01.2009 which was well within the period of one year from the date of importation though, more than six months after the date of importation. The appellant contended that delay of a few months in re-export was well within the power of the Commissioner to condone as Commissioner had power to extend the six months period for re-export by a further period of six months. The appellant cited the judgment in the case of Teletube Electronics Ltd. vs. CC, ICD, TKD, New Delhi  2009 (240) ELT 710 (Tri. Del.) and Government of India decision in the case of Harison Chemicals  2006 (200) ELT 171 (G.O.I.) in this regard.

4. We have considered the contentions of the appellant. There is no dispute that the goods were re-imported within a period of three years from the date of export. There is also no dispute that the goods were re-exported within one year of the date of re-importation but not within six months. Condition No. II of Notification No. 158 / 1995-Cus. required that the goods be re-exported from the date of importation within 6 months of the date of re-importation or such extended period not exceeding a further period of six months as the Commissioner of Customs may allow. In the present case, the appellant did not seek any permission to re-export the goods beyond the period of 6 months. Therefore, there was no basis for the Commissioner of Customs to allow such export during the extended period beyond six months. It is not claimed by the appellant that it sought permission of the Commissioner of Customs for exporting the goods beyond six months. As no such extension was sought, obviously none was (or could be) granted by the Commissioner. If the benefit of the said exemption notification is allowed as a matter of course when the export took place after a period of six months even when the Commissioner of Customs had not extended the period of export, the said condition will be rendered otiose.

Every condition of an exemption notification has to be strictly followed/ complied with. In the present case, it is evident that Condition No. II of the said exemption notification was not complied with. It has been held by Honble Supreme Court in the case of CCE, Pondicherry vs. Honda Seil Power Limited  2015 (323) ELT 644 (SC) that it is trite that exemption notification are to be construed strictly and even if there is any doubt same is to be given in favour of the Department. The judgment of Teletube Electronics (supra) cited by the appellant was passed on the basis of concession inasmuch as it recorded that it is also not disputed that the time limit of six months prescribed for re-export is not a rigid one. The judgment passed on the basis of concession does not have precedential value. The other judgment in the case of Harison Chemicals (supra) cited by the appellant was a Government of India decision which does not constitute a binding precedent for CESTAT. Thus as one of the conditions of exemption Notification No. 158/1995-Cus. was not satisfied in the present case, the benefit of the said exemption notification cannot be allowed to the appellant.

Consequently, the impugned order does not suffer from any infirmity. The appeal is dismissed.

(Justice G. Raghuram)

President

(R. K. Singh)

Member (Technical)

Pant