2019 (9) TMI 81 - AT - Customs

Tribunal rules in favor of EOU on duty exemption for re-imported goods

The Tribunal set aside the original authority's decision and ruled in favor of the appellant, a 100% EOU, regarding duty exemption on re-importation of ... 100% EOU - re-import for re-processing - benefit of N/N. 52/2003-Cus dt. 31/03/2003 - Department found that the appellant was not entitled to claim duty exemption on re-importation of exported goods since in terms of Sl.No.15 in Annexure-I to Notification No.52/03-Cus dt. 31/03/2003, the goods could have been imported only if the import had taken place before the expiry of one year from the date of export - HELD THAT:- In the present case, the appellant is 100% EOU and they had exported the final product and subsequently the final product was re-imported for carrying out re-processing due to complaint from the foreign buyer and the appellant re-processed the imported goods and finally exported the same which is not in dispute. Further, the Commissioner(Appeals) has not given any findings on this material aspect also. Also, the appellant’s case falls under Sl.No.14 of Annexure-I of Notification No.52/03-Cus dt. 31/03/2003 wherein a period of three years is provided from the date of exportation for repair and reconditioning and the appellant re-exported the goods within this period. Appeal allowed - decided in favor of appellant. Issues: Duty exemption on re-importation of goods under Customs Notification No.52/2003-Cus.Analysis:1. Facts of the Case: The appellant, a 100% EOU, exported activated carbon to the USA but faced quality issues leading to the return of a portion of the goods. The appellant re-imported the returned goods for re-processing but incorrectly mentioned the Shipping Bill reference in the Bill of Entry. The Department demanded duty exemption under Customs Notification No.52/2003-Cus, which the original authority ordered the appellant to pay.2. Appellant's Arguments: The appellant contended that the impugned order was unsustainable as the facts were not properly appreciated. They highlighted that the goods were re-imported for re-processing due to a complaint from the foreign buyer, re-processed, and then re-exported. The appellant argued that the denial of exemption under Sl.No.15 of the Notification was incorrect as it did not apply to their case. They claimed entitlement under Sl.No.14 for goods re-imported within three years for repair or reconditioning, which they complied with by re-exporting the goods.3. Department's Defense: The learned AR defended the impugned order without providing detailed arguments in the judgment.4. Tribunal's Decision: After considering both sides and the material on record, the Tribunal noted that the appellant, a 100% EOU, had re-imported, re-processed, and re-exported the goods within the specified time frame. The Tribunal found that the Commissioner(Appeals) did not address these crucial aspects and determined that the appellant's case fell under Sl.No.14 of the Notification. Consequently, the Tribunal set aside the impugned order, allowing the appeal of the appellant.5. Conclusion: The Tribunal's decision favored the appellant, emphasizing their compliance with the provisions of Customs Notification No.52/2003-Cus regarding duty exemption on re-importation of goods for repair and re-export. The judgment highlighted the importance of considering all relevant facts and provisions before denying such exemptions, ultimately providing relief to the appellant based on their adherence to the applicable regulations.