Re-import exemption for repair or reconditioning goods upheld where a 100% EOU re-exported them within the prescribed period.

Re-imported goods of a 100% EOU were held eligible for exemption under Notification No. 52/2003-Cus because they had been exported, returned on a foreign buyer's complaint for repair or reconditioning, and re-exported within three years. The relevant entry covered goods re-imported within the prescribed period for repair or reconditioning, so the lower authorities' reliance on an inapplicable entry was unsustainable. On these facts, the exemption could not be denied and the duty demand was not justified.

---

---

Issues: Whether the re-imported goods of a 100% Export Oriented Unit were entitled to exemption under Notification No. 52/2003-Cus, and whether the goods fell under Sl. No. 14 of Annexure-I as goods re-imported within three years for repair or reconditioning rather than under Sl. No. 15.

Analysis: The undisputed facts were that the appellant was a 100% EOU, had exported the goods, re-imported them because of a complaint from the foreign buyer, re-processed the goods, and re-exported them within three years from the date of export. The impugned order did not record any finding on this material aspect. On these facts, the re-import was covered by the entry relating to goods re-imported within three years for repair or reconditioning, and the time-limit objection applied by the lower authorities was not sustainable.

Conclusion: The exemption was available to the appellant, and the demand of duty was not justified.

Ratio Decidendi: Where re-imported goods are returned for repair or reconditioning and are re-exported within the prescribed period, exemption under the relevant notification cannot be denied by applying an inapplicable entry meant for a different factual situation.

---