2018 (12) TMI 1486 - AT - Customs

Tribunal remands case for reconsideration after denial of exemption for polyester fabrics import

The Tribunal upheld the denial of exemption under notification 203/92-Cus for the import of polyester fabrics due to the lack of nexus between the ... Exemption under N/N. 203/92-Cus - Value Based advance License - import of polyester fabrics - Held that:- The issue in the matter can be decided in a very narrow campus for consideration of the test reports and clarifications issued by the DGFT in the matter. Both the authorities have failed to consider these documents and render a finding in respect of these - Since these documents have not been considered by the lower authorities, the matter needs to go back to the original adjudicating authority for reconsideration of the issue in light of the clarification given by the Director General Foreign Trade and the test reports - appeal allowed by way of remand. Issues:1. Denial of exemption under notification 203/92-Cus for import of polyester fabrics.2. Nexus between imported goods and exported goods.3. Consideration of documentary evidence.4. Application of judgments relied upon by the appellant.5. Rejection of appeal by Commissioner (Appeal).Issue 1: Denial of Exemption under Notification 203/92-Cus for Import of Polyester Fabrics:The case involved appeals against the denial of exemption under notification 203/92-Cus for the import of polyester fabrics. The lower authority held that there was no nexus between the imported goods and exported goods as required by the conditions of the Advance License. The license specified the necessity of a connection between the imported and exported goods, which was not established. The lower authority also noted that the fabric was on the sensitive list, attracting quantitative restrictions. The appellant failed to provide documentary evidence regarding the usability of the polyester fabric for manufacturing synthetic shoes. The Tribunal upheld the decision to deny the exemption under the notification.Issue 2: Nexus Between Imported Goods and Exported Goods:The Assistant Commissioner adjudicated the matter and found that all types of fabric were sensitive items during the relevant period. The absence of specific quantity restrictions in the license meant that only non-sensitive items could be cleared under the category of synthetic material. The Tribunal referred to previous judgments to support this conclusion. The order directed the importer to pay duty along with interest under the Customs Act, 1962. The Commissioner (Appeal) rejected the appeal, leading to the filing of further appeals by the aggrieved appellants.Issue 3: Consideration of Documentary Evidence:The appellants argued that the imported polyester fabric was synthetic material usable in manufacturing synthetic shoes. They presented technical expert opinions and clarifications from the DGFT to support their claim. However, the lower authorities failed to consider these documents. The Tribunal agreed that these documents were crucial and remanded the matter back to the original adjudicating authority for reconsideration based on the clarifications and test reports provided by the appellants.Issue 4: Application of Judgments Relied Upon by the Appellant:The appellants relied on various judgments to support their case, emphasizing the nature of the imported fabric and its usability in manufacturing synthetic shoes. However, the Tribunal did not delve into the specifics of these judgments but focused on the documentary evidence provided by the appellants. The Tribunal set aside the order of the Commissioner (Appeal) and allowed the appeals for a remand to the original adjudicating authority for a fresh decision.Issue 5: Rejection of Appeal by Commissioner (Appeal):The Commissioner (Appeal) rejected the appeal filed by the appellants, prompting them to file further appeals. The appellants raised several points challenging the Commissioner's decision, including the failure to consider documentary evidence and seeking adjournments for collecting necessary documents. The Tribunal found that the crucial documents were not adequately considered and remanded the matter for a fresh decision by the adjudicating authority within a specified timeframe.In conclusion, the judgment addressed the denial of exemption under notification 203/92-Cus for the import of polyester fabrics, the requirement of a nexus between imported and exported goods, the importance of considering documentary evidence, the application of relied-upon judgments, and the rejection of the appeal by the Commissioner (Appeal). The Tribunal remanded the matter back to the original adjudicating authority for a fresh decision based on the crucial documents provided by the appellants.