Transferred advance licence protected customs exemption for glycerine imports despite policy norm objections and quality-related challenges.

Exemption under Notification No. 79/95-Cus. could not be denied where the imported unrefined glycerine was covered by a transferred advance licence that permitted import without any specification of quality or kind. The import and export policy norms governed the licensing authority and did not bind Customs when testing admissibility of the exemption notification. Once the licence authorised the goods, Customs could not refuse clearance on the ground that the licence did not conform to policy norms. The notification condition linking the imported goods to the export product was also inapplicable after transfer of the licence, and statements by the original licence applicants were not relevant against the transferee-importer.

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Issues: Whether exemption under Notification No. 79/95-Cus. could be denied on the ground that the imported unrefined glycerine was not of the quality required for manufacture of the export product under the import policy, notwithstanding that the goods were covered by a transferred advance licence.

Analysis: The licence permitted import of glycerine without a specification of quality or kind. The norms in the import and export policy governed the grant of licences by the licensing authority and did not bind Customs while examining admissibility of the exemption notification. Once the licence allowed import of the goods, Customs could not deny clearance on the ground that the licence was not issued in conformity with policy norms. Since the licence had been transferred, the notification condition correlating the imported goods with the export product was also inapplicable. Statements made by the original licence applicants as to use of glycerine were irrelevant against the transferee-importer and, in any event, were raised belatedly.

Conclusion: The exemption could not be denied, and the departmental appeal failed.

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