SEZ transfer and re-export condition can prima facie satisfy import exemption obligations under overriding SEZ law.

Imported second-hand capital goods claimed under Notification No. 21/2002-Customs were sent to a Special Economic Zone, raising the issue whether this transfer satisfied the re-export condition attached to the import exemption. The analysis treats receipt of goods in an SEZ from the domestic tariff area as export for SEZ purposes and applies Section 51 of the Special Economic Zones Act, 2005, which gives the SEZ law overriding effect over inconsistent provisions. On that basis, shipment to the SEZ was treated as prima facie compliance with the re-export obligation, and the appellants were found to have a strong prima facie case for waiver of pre-deposit and interim stay.

---

---

Issues: Whether shipment of the imported second-hand capital goods to a Special Economic Zone satisfied the re-export condition attached to the import exemption, and whether the appellants had made out a prima facie case for waiver of pre-deposit and grant of stay.

Analysis: The import was made claiming the benefit of Notification No. 21/2002-Customs and was also linked to the Foreign Trade Policy condition requiring re-export. The goods were admittedly sent to an SEZ. The order applied Section 51 of the Special Economic Zones Act, 2005, which gives the SEZ law overriding effect over inconsistent laws, and treated receipt of goods in the SEZ from the DTA as export from the DTA for SEZ purposes. On that basis, the order held that the export to the SEZ prima facie satisfied the re-export obligation arising from the import condition.

Conclusion: The appellants were held to have a strong prima facie case, and the requirement of pre-deposit of duty, interest, penalty and redemption fine was waived with an unconditional stay during pendency of the appeal.

Ratio Decidendi: Where imported goods are required to be re-exported and are sent to an SEZ, Section 51 of the Special Economic Zones Act, 2005 may prima facie prevail over inconsistent conditions so that such transfer can satisfy the re-export obligation for interim relief purposes.

---