Target Plus Scheme own-use condition covers job-work conversion when importer retains ownership and no transfer occurs

Under the Target Plus Scheme, sending duty-free imported goods to job workers for manufacture did not breach the non-transferability condition where the importer retained title and ownership. The scheme and exemption notification were read with the foreign trade policy to treat "own use" as including utilisation through job workers, and transfer was held to arise only at the stage of final sale of the manufactured goods, not when raw imported goods were sent for conversion. The exemption therefore remained available, and the confiscation, redemption fine, penalties, and denial of Cenvat credit were unsustainable.

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Issues: Whether import of duty-free goods under the Target Plus Scheme was violated by sending the goods to job workers for manufacture of finished products, and whether such arrangement amounted to transfer or sale of the imported goods so as to deny the exemption and consequential reliefs.

Analysis: The exemption notification under the Target Plus Scheme permitted import of goods against duty credit, subject to the condition that the certificate and the imported goods shall not be transferred or sold. The Court read the scheme and the notification together with the foreign trade policy and held that the expression "own use" includes utilisation through job workers, so long as the importer retains title and ownership in the imported goods. It noted that the goods were sent to job workers under the procedure in Notification No. 214/86-CE(NT), and that the transfer contemplated by the notification would arise only when ownership changes at the final sale stage of the manufactured goods, not when raw imported goods are sent for conversion.

Conclusion: Sending the imported goods to job workers for conversion did not violate the non-transferability condition or the requirement of own use. The exemption remained available, and the confiscation, redemption fine, penalties, and denial of Cenvat credit were unsustainable.

Final Conclusion: The assessee's appeals succeeded and the Revenue's appeal failed, with all adverse consequences under the impugned order set aside.

Ratio Decidendi: Under a duty exemption scheme that permits imports for own use and prohibits transfer or sale, conversion of the imported goods through job workers does not amount to transfer when the importer retains ownership and the goods are ultimately used in manufacture and cleared in the ordinary course.

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