Customs duty demand fails after export obligation discharge certificate and bond discharge remove the basis for recovery.

Customs duty demand could not be sustained once the Export Obligation Discharge Certificate was produced before the appellate authority and the advance licence bond had already been discharged by the competent authority. Although the certificate had not been filed before the adjudicating authority, its later production, together with discharge of the bond, removed the for the demand. The demand was therefore treated as no longer maintainable, and the appeal was allowed.

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Issues: Whether the customs demand could be sustained when the Export Obligation Discharge Certificate had been produced before the appellate authority and the bond executed for the advance licence had been discharged.

Analysis: The appellants had not produced the Export Obligation Discharge Certificate before the adjudicating authority, but the certificate was later furnished before the Commissioner (Appeals). The bond executed at the time of obtaining the advance licence had already been discharged by the appropriate authority. In these circumstances, the basis for confirming the duty demand ceased to survive, and the demand was not maintainable.

Conclusion: The demand was held to be unsustainable and the appeal was allowed.

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