TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 957
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....um frames were imported without payment of duty between December 2023 and September 2024, i.e., prior to the effective date of the said notification. 2. Submission made by the applicant 2.1 The Applicant has submitted that they are engaged in the manufacture of solar panels/modules at their facility located at SF No. 166 & 169, Kuppepalayam Village, Sembagounden Pudur, Sarkar Samakulam (Via), Coimbatore - 641 107. The Applicant further states that they have been granted a licence for Manufacture and Other Operations in Warehouse (MOOWR) in respect of the said premises under Chapter IX of the Customs Act, 1962. Pursuant to the said licence, the Applicant has been importing raw materials as well as capital goods required for the manufacturing process by filing Bills of Entry for warehousing under Section 46 read with Section 60 of the Customs Act, 1962 2.2 For manufacture of solar modules, the Applicant has imported certain aluminium Frames for Solar Panels/Modules (covered under tariff heading 7610 9010) without payment of duty during December 2023 to September 2024 under the MOOWR license. 2.3 During, September 2024, Government vide Notification No. 16/2024-Customs (ADD....
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....Q 8: Question: Can a unit undertaking manufacture and other operations in a bonded warehouse import capital goods without payment of duty? If yes, does this cover only Basic Customs Duty (BCD) or both BCD and Integrated Goods and Services Tax (IGST) on imports? For how long is the duty deferment available? Is interest payable after some time? Response: A unit licensed under Sections 58 and 65 of the Customs Act can import capital goods and warehouse them without payment of duty. The scheme for manufacture and other operations in a bonded warehouse is a duty deferment scheme, meaning both BCD and IGST on imports are deferred. For capital goods, the import duties (both BCD and IGST) are deferred until they are cleared from the warehouse for home consumption or exported. This deferment is without any time limitation. Relevant Extract from FAQ 11: Question: Is the import of raw materials without BCD and IGST allowed? Will there be any interest obligation if IGST is paid when finished goods are sold in domestic markets? Response: Inputs/raw materials can be imported and deposited in the licensed warehouse without payment of BCD and IGST. Ther....
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....ealers, the price paid by them did not include the cess that was payable only by the manufacturer either to the Board or to the Government and that therefore, the same should not be included as part of the turnover. But the said contention was overruled by the Supreme Court on the ground that the liability to pay cess got attached to the rubber when manufactured and that when it is ultimately paid by the end user, namely the manufacturer, it is implicit that the element of cess payable would be one of the factors in determining the price payable in respect thereof. 5.2.2 Mr. C. Natarajan, learned senior counsel appearing for the petitioner sought to draw a distinction between all the aforesaid three decisions of the Supreme Court (McDowell, Mohan Breweries and Madras Rubber Factory) and the case on hand, by contending that the revision petitioner is actually located in a Special Economic Zone and that they are not liable to pay even the basic customs duty and countervailing duty, in view of the provisions of the Special Economic Zones Act, 2005. Therefore, it is his contention that the sale and supply of goods made by the revision petitioner on an ex-works basis to a company who....
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.... of sales tax, additional sales tax and entry tax, if any, applicable to goods removed from a Special Economic Zone shall be at the rate in force as on the date of such removal, and where such date is not ascertainable, on the date of payment of tax. 5.2.5 As a matter of fact, the liability to pay anti-dumping duty arises due to the import. The revision petitioner herein is exempt from payment of the same, solely on account of the fact that they are located in a Special Economic Zone and that therefore, they are protected by Section 26(1) of the Central enactment and Section 12(1) of the State enactment. It is the appellant who enjoys the exemption by virtue of the statutory scheme and it is the very same appellant who suffers the automatic withdrawal of exemption, the moment the goods are removed from the Special Economic Zone to the Domestic Tariff Area. 5.3 The aforementioned judgement clarifies that the duties and taxes applicable needs to be determined at the time of goods being imported into SEZs. Applying the same analogy in the current facts of the Applicant, it is clearly evident that, at the time of import of aluminum frames, there was no requirement / no imposition....
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.... However, no response or comments have been received from the jurisdictional Commissionerate till the passing of this ruling. The matter is, therefore, being proceeded with on the basis of the records available and the submissions made by the applicant. 7. Details of Personal Hearing: 7.1 Further, a personal hearing was held on 10.11.2025 at 12:30 am in the matter. Shri Ashish S. Chartered Account, appeared for the hearing on behalf of applicant. He reiterated the submissions filed with the application that the applicant had imported during the period December, 2023 to September 2024. Aluminium Frames for manufacturing solar panels/modules (CTI 76109010) without payment of duty; which are still not cleared from the premises. The said goods were imported under MOOWR Scheme. That they believe that the MOOWR scheme is a duty deferment scheme and the goods imported on or before September, 2024 do not attract ADD in as much the said goods were imported between December 2023 to September, 2024 but the ADD notification issued vide notification 16/2024 Customs Dated 27.09.2024. In support he relied upon Hon'ble Madras High Court decision in the matter of Flextronics Technology....
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....ds" during the warehousing period; * The nature of anti-dumping duty as a duty of customs under Section 9A of the CTA, 1975 read with Section 12 of the Customs Act; * The binding judgments of the Supreme Court in Kiran Spinning Mills, Sneh Enterprises, Mangalore Refinery, Priya Blue Industries, etc .; * CBIC Circulars clarifying the operational framework of MOOWR vis-à-vis the general warehousing provisions. The resolution of this issue requires determining whether the duty liability crystallizes: * on the date of filing the into-bond bill of entry, as contended by certain applicant in MOOWR contexts, or * on the date of filing the ex-bond bill of entry, as consistently held in Supreme Court jurisprudence for goods remaining "imported goods" until home-consumption clearance. 8.3 The applicant's main plank is that MOOWR is a pure duty deferment scheme under which the duty that was "applicable" at the time of import alone becomes payable at the time of ex-bond. It is contended that since, during December 2023 to September 2024, no ADD was in force on aluminium frames under CTH 7610 90 10, the later imposition of ADD ....
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....onsumption has been made by the proper officer." This provision clearly states that the goods are not removed into the domestic tariff area until a Bill of Entry for home consumption is filed, the "import duty ... payable in respect of such goods" is paid, and an order for clearance is passed. 8.9 The expression "import duty ... payable in respect of such goods" in clause (b) does not itself fix the rate or date; it simply states that whatever duty is legally payable in respect of those goods has to be paid before clearance. The question "which rate is payable and with reference to what date?" is answered by Section 15, not by Section 68 itself. 8.10 Section 15(1)(b) - Date for Determination of Rate of Duty- Section 15(1)(b) provides as follows: - Section 15(1) (b) in the case of goods cleared from a warehouse under section 68, on the date on which a bill of entry for home consumption in respect of such goods is presented under that section; 8.11 The language is clear, mandatory and unambiguous. For goods cleared from a warehouse under Section 68, the statutory date for determination of the rate of duty is the date on which the ex-bond Bill of Entry for home co....
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...., if at all, must attach only at the time of "first import". However, it is notable that the applicant has not placed on record the statutory definition of "imported goods" as contained in Section 2(25) of the Customs Act, 1962. 8.17 For completeness, Section 2(25) of the Customs Act provides: - "'imported goods' means any goods brought into India from a place outside India but does not include goods which have been cleared for home consumption." 8.18 Two propositions flow directly from this: (i) Goods that have been brought into India and warehoused (including under MOOWR) are "imported goods" until they are cleared for home consumption; (ii) It is only when they are actually cleared for home consumption under Section 68 that they cease to be "imported goods". 8.19 Therefore, aluminium frames lying in the applicant's MOOWR warehouse continue to be "imported goods" under the Act at all material times prior to their ex-bond clearance. Being imported goods, they remain fully subject to the customs duty regime, including any new or additional duty components validly introduced before their clearance. 8.20 The applicant's attempt to treat t....
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....uty structure as on the date of warehousing. 9.3 These authorities decisively support the proposition that: * Warehousing does not "fix" the duty regime once and for all; * The rate of duty applicable to warehoused goods is governed by the statute with reference to a later date (ex-bond date or deemed removal date), and any intervening change in law, including imposition of new duty components, must be given effect to. 10. Applicant's Reliance on CBIC FAQs and Circulars- The applicant has relied on CBIC's MOOWR FAQs and Circular No. 50/2018-Customs (particularly clause 2(b) relating to EOUs) to argue that only the duty for which exemption was originally availed or deferred is payable at the time of removal, and no new levy introduced later can apply. 10.1 Firstly, Circular 50/2018-Cus. deals specifically with EOU/EPZ/EHTP/STP schemes and the reversal of exemption when goods are cleared into the domestic tariff area. MOOWR scheme is structurally different: it is a bonded warehousing and duty deferment scheme, not an exemption scheme. The analogy, therefore, is inherently limited. 10.2 Secondly, even within the EOU context, the Circular must be r....
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.... the consistent line of warehousing decisions such as SISCOL, W.G. Forge and Kesoram Rayon cited herein feesyear above. 12. In this regard, it is equally pertinent to note the judicial position that precedents must be applied contextually and with careful attention to their factual foundation. The Hon'ble Supreme Court in Ambica Quarry Works v. State of Gujarat & others, 1987 (1) SCC 213, held: "The ratio of any decision must be understood in the background of the facts of that case. It has been said long time ago that a case is only an authority for what it actually decides, and not what logically follows from it." Further, the Hon'ble Supreme Court reiterated this principle in Bhavnagar University v. Palitana Sugar Mills Pvt. Ltd., 2003 (2) SCC 111, wherein it was observed: "It is well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision. " These pronouncements reinforce that reliance on judicial precedent requires strict factual alignment, and that extrapolation beyond the specific context addressed by the Court is impermissible. Accordingly, the reliance placed by th....