Target Plus Scheme benefit upheld where imported inputs were job-worked and showed broad nexus with export products.

Under the Target Plus Scheme, the importer was required only to show a broad nexus between the imported inputs and the export product group, not physical incorporation of the inputs in the exact exported goods. The scheme was treated as a post-export incentive rewarding export performance, so it did not create a further export obligation tied to the imported materials. Conversion of imported plastic granules through a job worker was treated as satisfying the actual user requirement, and sale of the resultant products was permissible. The authority found no legal infirmity in granting the notification benefit, so the exemption was upheld.

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Issues: Whether the importer was entitled to the benefit of Notification No. 32/2005-Cus. under the Target Plus Scheme notwithstanding that the imported plastic granules were not physically consumed in the export goods and were converted through job workers.

Analysis: The scheme was treated as a post-export incentive intended to reward export performance, and not as a scheme imposing a further export obligation linked to the imported inputs. The clarified position of the DGFT was relied upon to show that conversion of imported inputs through a jobbing unit satisfies the actual user requirement, and that sale of resultant products is permissible. Paragraph 3.7.6 of the Foreign Trade Policy 2004-2009 and Paragraph 3.2.5(II) of the Handbook of Procedures 2004-2009 were read as requiring only a broad nexus between the imported goods and the export product group, not physical incorporation of the imported goods in the very goods exported. The record did not show any legal infirmity in the original authority's view that the conditions of the notification were fulfilled.

Conclusion: The benefit of the Target Plus Scheme was rightly extended, and the Revenue had no basis to disturb the exemption.

Ratio Decidendi: Under the Target Plus Scheme, the importer need only establish broad nexus and own use within the relevant product group; physical use of the imported inputs in the exact export product is not a mandatory condition.

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