Notional clearance under EPCG scheme may be considered despite missed re-export deadlines, subject to normal conditions.

An importer who failed to re-export capital goods within the original and extended period under Customs Notification No. 3/89-Cus could still seek alternative relief under the Export Promotion Capital Goods scheme. The authorities were required to consider the request for further extension, or alternatively assess the claim for notional clearance on its merits, rather than reject it solely because the goods had earlier been cleared under another customs notification. Relief under the EPCG scheme remained subject to its normal conditions, but denial without proper consideration was unsustainable.

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Issues: Whether the importer was entitled to notional clearance of the capital goods under the Export Promotion Capital Goods scheme after failing to re-export the goods within the stipulated period under Customs Notification No. 3/89-Cus.

Analysis: The importer had failed to re-export the goods within the original period and also within the extended period already granted. The request for a further extension was not considered, although the authority was competent to do so. The alternative request for clearance of the goods under the Export Promotion Capital Goods scheme ought to have been considered on its merits, and no valid reason was shown for denying that benefit merely because the goods had earlier been cleared under another customs notification. The authorities should have either permitted re-export or allowed notional clearance under the Export Promotion Capital Goods scheme subject to its normal conditions.

Conclusion: The importer was entitled to notional clearance of the capital goods under the Export Promotion Capital Goods scheme, subject to the normal conditions of the scheme, and the refusal to grant that relief was unsustainable.

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