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of <h1>Tribunal rules in favor of appellant, duty not payable due to Development Commissioner's acceptance of export performance</h1> <h3>COMMISSIONER OF CUS. & C. EX., GUNTUR Versus VIJAYA SHRIMP FARMS LTD.</h3> COMMISSIONER OF CUS. & C. EX., GUNTUR Versus VIJAYA SHRIMP FARMS LTD. - 2014 (300) E.L.T. 564 (Tri. - Bang.) Issues:1. Failure to fulfill export obligation.2. Demand for duty on goods procured duty-free.Issue 1: Failure to fulfill export obligationThe appellant was required to produce a specific quantity of prawn and prawn seeds with a minimum value addition over a period of 10 years. The appellant imported capital goods, consumables, and raw materials, and cleared a portion of prawn and prawn seeds. The Revenue alleged that the export obligation was not met, leading to a show cause notice for duty recovery. The Commissioner, however, noted that the Development Commissioner had condoned the shortfall in export obligation, considering it fulfilled. The Revenue appealed this decision, arguing that the clearances were made without proper permissions. The appellant contended that they had permission to clear goods to other units, which exported them. The Tribunal observed that 100% EOUs were allowed to transfer goods to other EOUs without permission, and unless proved otherwise, duty could not be demanded. As the Development Commissioner had condoned the shortfall, the duty was not liable to be paid.Issue 2: Demand for duty on goods procured duty-freeRegarding the duty demand on imported and indigenous goods, the Tribunal found the Commissioner's decision justified. The Development Commissioner was the authority to determine if the export obligation was fulfilled. The Commissioner's observations highlighted that the Development Commissioner had condoned the shortfall and upheld the fulfillment of conditions, preventing duty demand. As the Development Commissioner accepted the export performance as sufficient, the Tribunal held that the duty demand was unjustified. The Revenue's appeal was rejected, and the respondent's cross-objection was disposed of accordingly.In conclusion, the Tribunal upheld the Commissioner's decision, emphasizing the importance of the Development Commissioner's role in determining export obligation fulfillment and rejecting the duty demand based on the condonation of the shortfall.
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