Customs duty exemption claims require consideration of all material evidence; selective review led to quashing and remand.

Customs duty exemption claims under the deemed export scheme must be decided on a complete consideration of the record. The HC held that the rejection was unsustainable because the authority relied mainly on a clarification letter and failed to examine contemporaneous documents supporting the claim that supplies were made for a new refinery project, including project approvals, extension of validity, a project authority certificate and later clarifications. This non-consideration of material evidence amounted to non-application of mind. The impugned orders were quashed and the matter remanded to the original authority for fresh consideration on merits after giving a personal hearing.

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Issues: Whether the orders rejecting the claim for customs duty exemption under the deemed export scheme were liable to be quashed for non-consideration of the material documents and the matter remanded for fresh consideration.

Analysis: The claim turned on whether the supplies were made for a new refinery project and whether the exemption notification applied. The record showed multiple contemporaneous documents supporting the petitioner's case, including approvals relating to the proposed refinery, extension of validity, project authority certificate and subsequent clarifications. The impugned orders relied mainly on a clarification letter and did not deal with the petitioner's supporting documents. Since the material placed before the authorities was not considered, the rejection of exemption suffered from non-application of mind.

Conclusion: The impugned orders were unsustainable and were quashed, and the matter was remanded to the original authority for fresh consideration on merits after granting personal hearing.

Ratio Decidendi: An order rejecting a fiscal exemption claim is vulnerable where the authority fails to consider material evidence supporting the claim and proceeds on a selective or incomplete examination of the record; such an order may be set aside and remanded for reconsideration.

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