2017 (1) TMI 1727 - AT - Customs

Customs Appeal Dismissed Due to Failure to Re-Export: Importance of Compliance and Public Interest

PAUL ABRAO AGENCIES PVT. LTD. Versus COMMISSIONER OF CUSTOMS (PORT-IMPORT), CHENNAI

PAUL ABRAO AGENCIES PVT. LTD. Versus COMMISSIONER OF CUSTOMS (PORT-IMPORT), CHENNAI - 2017 (349) E.L.T. 676 (Tri. - Chennai) Issues:Whether non-re-export of 'flexitanks' by the appellant disentitles them to the benefit of exemption Notification No. 104/94-Cus., dated 16-3-1994.Analysis:The judgment by the Appellate Tribunal CESTAT CHENNAI dealt with the issue of whether the appellant, who imported 'flexitanks' but did not re-export them after necessary processing, was entitled to the benefit of exemption under Notification No. 104/94-Cus., dated 16-3-1994. The appellant did not carry out any processing of the goods nor exported them; instead, a third party was involved in the export process. The Revenue contended that the appellant's failure to re-export the goods as per the conditions of the notification and the bond executed at the time of import deprived them of the exemption benefit. The Tribunal held that non-fulfillment of the bond condition negated the appellant's claim to the notification benefit, emphasizing that exemptions are granted at the cost of public interest and must not be interpreted to the disadvantage of the public.The Tribunal reviewed the order of the learned Commissioner (Appeals) and the appellant's grounds of appeal. The appellant argued that the Commissioner's order was inconsistent and arbitrary, but failed to raise specific grounds in defense. The Tribunal noted that the appellant's failure to fulfill the basic condition of the notification, despite gaining import duty benefits, meant they were obligated under the law to export the processed goods without involving a third party. The Tribunal emphasized that the appellant must satisfy the notification's basic conditions before claiming the benefit, and failure to do so would result in the loss of the exemption benefit. The judgment highlighted that the appellant's actions breached the public trust as exemptions should not be interpreted liberally to the detriment of public interest.In conclusion, the Tribunal dismissed the appeal, emphasizing that the appellant's failure to fulfill the bond condition and export the processed goods as required by the notification resulted in the loss of the exemption benefit. The judgment underscored the importance of upholding obligations under the law and ensuring that exemptions are not misused to the disadvantage of public interest.