2017 (4) TMI 1301 - AT - Customs

Dispute over duty-free imports without EODC: Review for export obligations compliance

Tex Corp Ltd. Versus Commissioner of Customs, New Delhi

The case involved a dispute over the confirmation of demand against the assessee for importing duty-free raw material without submitting the Export ... Benefit of N/N. 93/2004-Cus., dated 10-9-2004 - denial on the ground that appellant have not submitted Export Obligation Discharge Certificate issued by DGFT so as to establish that the exports have taken place - Held that: - there is no condition in the notification requiring the production of EODC certificate and the fact that the export has taken place can also be established from the other evidences. The condition of production of EODC certificate by DGFT cannot be introduced in the notification, as per the settled principle of interpretation - matter remanded for denovo adjudication - appeal allowed by way of remand. Issues:1. Confirmation of demand against the assessee for importing duty-free raw material without submitting Export Obligation Discharge Certificate.2. Appeal against the order passed by DGFT regarding the export obligation fulfillment.3. Lack of clarity on further proceedings involving multiple advance licenses.4. Interpretation of Notification No. 93/2004-Cus. regarding evidence of export obligation discharge.Analysis:1. The judgment deals with the confirmation of demand against the assessee for importing duty-free raw material without submitting the Export Obligation Discharge Certificate (EODC) as required by Notification No. 93/2004-Cus. The Commissioner confirmed the demand, interest, and penalties due to the absence of EODC to establish exports from 2004 to 2013. The appellants applied for EODC in 2011, but it was not issued due to unfulfilled export obligations, leading to an order imposing penal penalties in 2011 by DGFT.2. An appeal was made against the 2011 order to the higher appellate authority under DGFT, which observed the submission of prescribed documents by the appellants and remanded the matter for reconsideration. The Additional Director General of Foreign Trade set aside the 2011 order and directed a review by the Regional Authority to determine if export obligations were fulfilled.3. The judgment notes a lack of record on further proceedings post the remand by the Additional Director General of Foreign Trade, with both sides unable to provide clarity. The Revenue's representative mentioned involvement of three more licenses besides the one in question, indicating a complex scenario with multiple licenses.4. Regarding the interpretation of Notification No. 93/2004-Cus., the Tribunal highlighted that while EODC is a sufficient evidence for releasing advance licenses, the notification does not explicitly mandate its production. The Tribunal emphasized that export verification can be established through other evidence, and introducing a mandatory EODC requirement would contradict established principles of interpretation. Consequently, the Tribunal set aside the impugned order and remanded the matter to the Commissioner for a detailed examination of export facts and developments post the DGFT's remand order, allowing the appellant to provide evidence of export for all advance licenses. The appeal was allowed by way of remand, emphasizing the importance of establishing the factum of export for all licenses involved.