Customs exemption for synthetic tanning agents upheld; end-use inquiry at clearance stage was impermissible.

Imported synthetic tanning agents falling within the notified description of "syntans" were held to be covered by the exemption notification issued under Section 25(1) of the Customs Act. At the stage of clearance, Customs could not refuse exemption by examining the importer's intended end use or by insisting that use in the leather industry be established. Any later objection on actual use could be pursued through appropriate recovery proceedings if required. The refusal to grant exemption and clear the goods was therefore unsustainable, and clearance under the notification was warranted.

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Issues: Whether the imported goods were entitled to exemption under the notification issued under Section 25(1) of the Customs Act at the stage of clearance, and whether Customs could refuse clearance on the ground that the intended end use had not been established.

Analysis: The goods imported were found to be synthetic tanning agents falling within the notified description of "syntans". The exemption notification granted relief in public interest to the goods specified in the table, and at the stage of clearance the Customs authorities were not entitled to investigate how the goods would subsequently be used. Any objection that the goods were not used in the leather industry could be addressed later through appropriate recovery proceedings if necessary.

Conclusion: The refusal to extend the exemption and clear the goods was unsustainable; the petitioners were entitled to clearance of the imported goods under the exemption notification.

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