Transferable import licence exemption applies without proving direct nexus once export obligation is fulfilled.

A transferee of an endorsed transferable import licence may claim exemption under Notification No. 204/92-Cus without proving a direct nexus between the imported goods and the exported product, where the export obligation has already been fulfilled and transfer is permitted under the policy conditions. The notification, read with its conditions, was intended to cover imported goods used to meet export obligation or to replenish goods used in exported products; once transferability is validly endorsed, the benefit extends to the transferee and cannot be refused solely for want of direct linkage.

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Issues: Whether a transferee of a transferable import licence is required to establish a nexus between the imported goods and the exported product for availing the benefit of Notification No. 204/92-Cus.

Analysis: The notification was intended to exempt imported goods used for meeting export obligation or for replenishment of goods used in exported products. The notification, read with the policy conditions, showed that transfer of the licence was permitted only after the export obligation had been fulfilled and the licence transferred by the licensing authority. Condition 8 enabled the benefit to a person other than the original licensee once transferability was endorsed. In that situation, the transferee was not required to prove that the imported goods had direct nexus with the exported product, because the export obligation had already been discharged.

Conclusion: The transferee was not required to establish nexus between the imported goods and the export product, and the benefit of the notification could not be denied on that ground.

Ratio Decidendi: Where a transferable licence is endorsed and the export obligation has already been fulfilled, the transferee may claim the exemption under the notification without proving direct linkage between the imported goods and the exported goods.

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