Tribunal rules in favor of appellant on Certificate of Origin issue; department's failure to follow procedure leads to dismissal.

The Tribunal found in favor of the appellant regarding the authenticity and validity of the Certificate of Origin for PVC Sheeting Flex Banner imported from Malaysia. The department failed to follow the required procedure under Rule 9 of the Customs Tariff Rules 2011, leading to the dismissal of their allegations that the goods were of Chinese origin. The Tribunal emphasized the necessity of proper verification and adherence to procedural requirements, ultimately setting aside the impugned order and allowing the appeal.

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Issues Involved:
1. Authenticity and validity of the Certificate of Origin.
2. Compliance with Rule 9 of the Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of The Republic of India and Malaysia) Rules 2011.
3. Departmental procedure and authority to question the Certificate of Origin.

Summary:

1. Authenticity and Validity of the Certificate of Origin:
The appellant imported PVC Sheeting Flex Banner from Malaysia and claimed a concessional rate of duty under Notification No. 53/2011-Cus dated 01.07.2011. The department alleged that the goods were of Chinese origin based on the Bills of Lading, despite the Certificate of Origin issued by the Malay Chamber of Commerce Malaysia. The appellant argued that the certificate's authenticity was not proven to be fake or non-genuine and referred to Rule 9 of the Customs Tariff Rules 2011, which mandates retroactive checks in case of doubt.

2. Compliance with Rule 9 of the Customs Tariff Rules 2011:
The Tribunal noted that the department did not follow the mandatory procedure under Rule 9, which requires the Customs Authority of India to request the issuing authority in Malaysia to verify the authenticity of the Certificate of Origin. The Tribunal emphasized that without such verification, the allegation that the goods were of Chinese origin could not be sustained. The Tribunal cited Rule 9, highlighting that goods must be directly consigned from the exporting party to the importing party or meet specific conditions if passing through a non-party territory.

3. Departmental Procedure and Authority to Question the Certificate of Origin:
The Tribunal referred to several judgments, including M/s. BDB Exports Pvt. Ltd., M/s. R. S. Industries (Rolling Mills) Ltd., and M/s. MJ Gold Pvt. Ltd., to support the view that the Customs Authority cannot unilaterally discard a Certificate of Origin without following the prescribed procedure. The Tribunal reiterated that the certificate issued by the designated authority must be honored unless proven otherwise through proper channels. The Tribunal also noted that discrepancies were only found in two out of five certificates, making the allegations against the remaining three certificates baseless.

Conclusion:
The Tribunal concluded that the department's failure to follow the prescribed procedure under Rule 9 rendered their allegations unsustainable. The impugned order was set aside, and the appeal was allowed. The Tribunal emphasized the importance of adhering to procedural requirements and respecting certificates issued by designated authorities to maintain the integrity of international trade agreements.

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