TaxTMI 
TaxTMI 
2013 (9) TMI 921
X X X X Extracts X X X X
X X X X Extracts X X X X
....o pay any Custom duties on such raw materials? 3. Such questions arise in following factual background. The appellant No.1, is a Company registered under the Companies Act, 1956 (hereinafter to be referred to as "the Company") and is engaged in the business of manufacture of plastic products like re-processed plastic granules, agglomerates, etc. The Company established its manufacturing unit in Kandla Free Trade Zone ("KAFTZ" for short). The Ministry of Commerce, Government of India issued a Letter of Permission ("LoP" for short) dated 27-12-1996 to the Company for setting up a new industrial unit in KAFTZ for manufacturing of plastic granules, shredding, grinding, pieces etc. subject to certain conditions. The items of manufacture were specified in the LoP. Such items were to be manufactured from waste/scrap/discarded/ obsolete plastic items. The annual capacity of production year-wise for five years was also specified. One of the conditions was that the unit had to export 100% of its production to General Currency Area countries. Condition No. 4 of the LoP which is the center of the controversy between the parties read as under : "(4) Import of plastic scrap/waste shall be stri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oms passed an order dated 20-4-2001 primarily on the ground that the imported plastic items did not conform to the requirements of the public notice dated 1-1-1997. That duty demand with interest, confiscation were confirmed. The Commissioner passed the following order : "(1) The total quantity of 63,180 MTs of usable rolls of plastic and plastic scrap declared value at Rs. 5,63,400/- which are put under seizure under panchnama dated 18-6-99 is confiscated under section 111(d) & (m) of the Customs Act, 1962 read with Foreign Trade Development & Regulation Act, 1992. However, since the goods have been provisionally released and they are not available for confiscation, I impose a fine of Rs. 4,50,000 (Rupees four lakhs fifty thousand only) in lieu of confiscation. I note that the goods have already been released provisionally on furnishing Bank Guarantee and P.D. Bond. The same is ordered to be appropriated from Bank Guarantee amount and remaining should be recovered by enforcing the provision of P.D. Bond under the relevant provision of the Customs Act, 1962 and Rules and Regulations as applicable. (2) The classification of the goods in the B/E No. 375, dated 15-6-1999 for useable....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ppellants had to fulfill two requirements of imports at the time of actual imports. In this case, at the time of such imports, public notice dated 1-1-1997 was already issued which governed the imports to be made by all importers without any distinction. 14. To resolve this controversy, we may look at some of the provisions contained in the Import Export Policy. The Export and Import Policy of 1992-97 contained Chapter IX pertaining to Export Oriented Units and Units in Export Processing Zones. Paragraph 93 of Chapter IX pertains to eligibility for units to qualify for EOU or EPZ units. Paragraph 94 pertain to importability of goods and provided as under : "94. An EOU/EPZ unit may import free of duty all types of goods, including capital goods, required by it for manufacture, production or processing provided they are not prohibited items in the Negative List of Imports. However, import of Basmati paddy/brown rice shall be prohibited.". 15. The Government of India also to implement such Import Export Policy, published Handbook of Procedures, Chapter V thereof pertains to imports. Paragraph 24 contained in such chapter provided that where an import license or customs clearance pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....requirement of obtaining a license read with the very beginning of the notice in which reference is made to paragraph 27(2) of the Handbook which pertains to procedure for industries which are not EOU/EPZ units, would show that such public notice pertain to units other than EOU/EPZ units. We are informed that for importing raw materials as per the permission granted for LoP, as per the procedure prescribed by the Government of India at the relevant time, no licenses were required to be obtained. We may also notice that in paragraph 10 of the notice while specifying that the import license issued in accordance with the public notice shall be subject to actual user condition and other such condition as may be imposed by the Special Licensing Committee, it is further provided as under : "(3) While imports of plastic wastes and scrap by 100% EOUs and unit in EPZ shall continue to be governed by the provisions of para 94 of the Export and Import Policy, the parameters for import of plastic wastes/scrap as specified. This Public Notice shall, however, be kept in view by the Board of Approval concerned while approving such units under the Scheme." 21. This would, thus, reveal that the ....