Strict exemption conditions for imported goods require importer-led processing and re-export; third-party compliance defeats the benefit.

Imported flexitanks under Notification No. 104/94-Cus. were subject to a strict exemption condition requiring the importer to process the goods and re-export them in terms of the bond executed at import. Where the importer did not itself undertake the processing or re-export, and a third party performed those steps instead, the basic conditions of the notification were not satisfied. On that basis, breach of the bond condition defeats the claim to exemption, and the benefit cannot be retained unless all prescribed conditions are complied with.

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Issues: Whether the imported flexitanks were entitled to exemption under Notification No. 104/94-Cus. despite non-fulfilment of the condition requiring re-export by the importer after processing.

Analysis: The exemption was conditional upon the importer processing the goods and re-exporting them in accordance with the bond executed at the time of import. The importer did not itself carry out the processing or the re-export, and a third party was involved instead. Since exemption notifications are to be construed strictly and the benefit cannot be claimed unless the basic conditions are satisfied, breach of the bond condition defeated the claim to exemption.

Conclusion: The importer was not entitled to the exemption benefit, and the denial of exemption was upheld.

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