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of <h1>Authority cannot impose end-use verification via Circular 40/2001 after Notification 17/01 to narrow exemption; appeal dismissed</h1> <h3>Union of India & Others Versus Inter Continental (India)</h3> The SC affirmed the HC's ruling that the department cannot, by issuing a circular after Notification 17/01 (Circular 40/2001), impose a new condition-such ... Seeking to impose a limitation on the exemption Notification 17/01 - Circular 40/2001 - business of trading - whether the end-use verification of the products is necessary for availing the benefit of concessional rate of duty - HELD THAT:- We entirely agree with the view taken by the High Court that the department could not, by issuing a circular subsequent to the notification, add a new condition to the notification thereby either restricting the scope of the exemption notification or whittle it down. A three Judge Bench of this Court in the case of Tata Teleservices Ltd. v. Commissioner of Customs [2005 (12) TMI 96 - SUPREME COURT] has taken a similar view. Following the aforesaid decision, we do not find any merit in this appeal and dismiss the same leaving the parties to bear their own costs. Issues:1. Whether end-use verification of products is necessary for availing the benefit of concessional rate of duty.Analysis:The Supreme Court considered the appeal filed by the revenue regarding the necessity of end-use verification for availing the concessional rate of duty. The respondent-assessee was involved in trading various commodities, including Crude Palm Oil and Crude Palmolin of Non-Edible Grade. The assessee imported these products and cleared them at a concessional rate of duty instead of the higher rate specified in the notification. The customs authorities required the assessee to produce an End-use Certificate to avail the concessional rate, as per a Board's Circular. However, the assessee challenged this requirement by filing a writ petition in the High Court, arguing that the circular imposed a new condition beyond the notification's scope.The High Court accepted the writ petition, stating that the circular could not add a new condition to the notification, as it would amount to legislating through circulars, which is impermissible. The High Court emphasized that if the notification did not specify any conditions, subsequent circulars could not impose them. The Supreme Court concurred with the High Court's view, citing a previous case where it was held that the department cannot restrict or modify the exemption notification through subsequent circulars. Therefore, the Supreme Court dismissed the appeal, upholding the High Court's decision and directing each party to bear its own costs.In conclusion, the judgment clarified that end-use verification for availing concessional duty rates is a contentious issue, with the courts emphasizing that circulars cannot impose new conditions beyond what is specified in the notification. This case underscores the importance of adhering to the provisions of notifications without adding extraneous requirements through subsequent circulars, ensuring clarity and consistency in the application of customs duties.
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