TaxTMI 
TaxTMI 
2016 (5) TMI 893
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....h it is to be considered whether the Crude Palm Kernel oil is vegetable fat and whether benefit of Notification No. 46/2002-Cus can be extended or otherwise. Notification No. 46/2002-Cus exempts material imported into India from whole of customs duty, as well as from CVD if the same is for replenishment by a licence as an intermediate. It is the case of the revenue that Crude Palm Kernel oil is not used as raw material, but it is an intermediate for manufacturing biscuits, it is not a raw material, hence not covered by DFRC licence. Coming to a conclusion that such a Crude Palm Kernel oil can not be used for manufacturing of biscuits, the benefit of Notification No. 46/2002-Cus was denied and the re-validation of DFRC lience were rejected. ....
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....ities that palm oil, coconut oil, palm kernel oil are one of the inputs which are required for the manufacture of biscuits. 7.5 Be that as it may, at the same time, we find that the Public Notice issued by the Customs Authorities vide Circular No. 24/2002 dated 6-5-2002 in respect of DFRC scheme reads as under: "2.2 DFRC Scheme DFRC scheme was first announced in Exim Policy 2000-2001 with effect from 1.4.2000 DFRC Scheme has been continued in Exim Policy 2002-2007 with some minor changes. The ealier DFRC scheme announced in 2000-01 Exim Policy required that for the purpose of allowing DFRC benefit to imported inputs used in the resultant expourt product, the quality, technical characteristics and specifications of....
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.... Customs Notification No. 46/2002-Cus dated 22.4.2002 has been issued to operationalise this scheme." 7.6 It can be seen from the above reproduced Circular that the question of co-relating the input and output would arise only in the case of sensitive items, as already reproduced by us in the earlier para that crude palm oil is not listed as a sensitive item, in para 4.31 of the Handbook of Procedures. The adjudicating authority has also not recorded any contrary findings to this submission made by the assessee before him. The entire adjudication proceedings and the findings of the adjudicating authority has proceeded only on the ground that the Crude Palm oil of Edible Grade imported by the assessee is required to be refined bef....
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....s, the benefit can be availed by an importer for the materials imported under DFRC licence, even if it is an intermediate. In the case in hand, there is factual findings that the goods imported, i.e crude palm oil (edible grade) requires refining before it can be put to use for the manufacturing of biscuits, it would get covered under the category of materials as an intermediate. If that be so, the benefit of Notification No. 90/2004 cannot be denied to the assessee. 7.8 We also find strong force in the submissions of the Ld. Counsel, that the nexus is not required to be established by the transferee of the licence. It is seen that in the case before us, it is undisputed that the appellants/importer had purchased DFRC licences fr....
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.... of respondent. (Operative part pronounced in court) ============= Document 1 c No: 01/15/182B/AM07/DES. VI 628 GOVERNMENT OF INDIA MINISTRY OF COMMERCE AND INDUSTRY DIRECTORATE GENERAL OF FOREIGN TRADE UDYOG BHAWAN, NEW DELHI-110011 To M/s. Parle Products Pvt. Vile Parle East, Mumbal-57. [ Date: 29/06/200 Subject: Clarification with regard to input of Vegetable fats against export of Biscuits Under food products. Sir, I am directed to refer to earlier letter dated 25.5.2006 of even no. on the above mentioned subject. As per your letter dated 5.6.2008, the case was considered in the NC Commitee and it has been deckled that the last Para of ALC Minutes dated 18.5.2006 may be amended ....