GOODS IMPORT UNDER (IGCRD )

[VISHAL KUMBHARDARE]

DEAR SIR ,

SRESPL has imported ‘evacuated tubes with three layers of solar selective coating for use in the manufacture of solar water heater and system’ classified under Chapter Tariff Heading No. 84199090 of the first schedule to the Customs Tariff Act, 1975 from China. A SURETY BOND submitting of their intention to import the said evacuated tubes was filed with the Assistant Commissioner of Customs, and annexed as ‘Annexure A’.

By virtue of such imports, SRESPL availed the benefit of concessional rate of duty at NIL rate (instead of the normal rate of duty at BASIC 7.5% CVD 12 % SAD 4 % as provided under Serial No. 399 C AND 238 B of Notification Customs AND EXCISE .

However, a go-down/ warehouse search of SRESPL was conducted by the Directorate General of Goods and Service Tax Intelligence (hereinafter referred to as ‘DGGSTI’ for the sake of brevity) in connection with a Customs enquiry that SRESPL was violating the conditions of the exemption notification (Condition No.9) and the rules laid down under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2017 (hereinafter referred to as ‘Customs Rules, 2017’ for the sake of brevity) by selling the evacuated tubes to other MANUFACTURERS and not keeping record and not file returns but SRESPL make the sales bill to other manufaturers .the evacuated tubes cannot be used for any other purpose other than its intended use i.e. for the manufacture of solar water heaters. This is because the said product only has its utility in the manufacture of such solar water systems and would be of no use if utilised elsewhere for anything else. Thus, even though SRESPL sold the imported goods to third parties on whose premises the solar water systems were eventually manufactured, yet it is relevant to bear in mind the fact that ultimately the end or the final product manufactured is the same that would have been manufactured by SRESPL .

And other side same goods are exemption for additional duty in custom tariff namely solar vaccum collector under sr no 361 also....

The notifications that state that Solar Water Heaters and Parts do not attract Excise Duty, Sales Tax, Local Body Tax of any kind of taxes

Please suggest need to go Settlement Commissions or appeal

[DR.MARIAPPAN GOVINDARAJAN]

Whether any show cause notice has been issued in your case?

[VISHAL KUMBHARDARE]

Thanks for reply sir 🙏

now no issues show case notice ...

[Malay pota]

As per my view if any goods is imported availing Customs duty benefit under the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 the imported goods must be utilised in accordance with use as provided in the Notification No.Notification No. 68/2017-Customs (N. T.) New Delhi, the 30th June, 2017.If the person does not so utilise the imported item the appropriate authority may take action for invoking the surety and bond submitted at the time of obtaining the permission (Procurment Certificate (PC)) and take legal action too.

AI Summary

Concessional import duty for specified inputs may be revoked if goods are diverted from the declared manufacturing end use. Importation under the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 of evacuated tubes for manufacture of solar water heaters was permitted at a concessional rate of duty subject to end-use, recordkeeping and return obligations; a DGGSTI search alleges diversion/sale to third parties and failure to maintain records, exposing the importer to invocation of the surety bond and legal action if non utilisation is established.