TaxTMI 
TaxTMI 
2001 (6) TMI 129
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.... it was yet to take place. The import and export was concurrently going on. 2.This appellant claimed in respect of the material that it imported under these licences, benefit of Notification 204/92. In essence this notification requires that the goods be imported against the quantity based duty exemption entitlement certificate issued by the licensing authority. The importer is required to furnish a bond or legal undertaking before the licensing authority for compliance of the condition in the notification, that exempted material shall not be disposed of or utilised in any manner, except for utilisation and discharge of export obligation, before the obligation under the licence is discharged in full and export is full. Notification, defines, in the explanation 'material' to mean "(a) raw materials, components, intermediates, consumables and parts required for manufacture of export product; (b) spares and mandatory spares within a value limit of 5% of the value of the licence, which are required to be exported along with the export products; and (c) packing m....
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....xported product but had been incorporated in the licence by furnishing wrong information to the licensing authorities and propose denial of exemption to it. Notices also propose confiscation of materials under Section 111(d) of the Act and penalties on the importer, its director Mahendra Kothari and Manager Ashwin Thakkar. 5.In the orders disposing of these show cause notices the Commissioner gave up the first charge that we have referred to. He noted that the norms prescribed in the Handbook were in the nature of average and any person, who by using better and more efficient technology could do with a lesser quantity than that was prescribed in the norms could not be punished, and was entitled to the exemption for the entire quantity arrived at by applying that norms. He found the second and third charges to be substantiated and demanded duty on these and imposed penalties on the company, its Director and Manager. Hence these appeals. 6.The reason that the Commissioner advances for his conclusion with regard to the charge relating to import of materials for which the norms were fixed by the licensing committees are as follows: The manufacturer who applies for the licence is ....
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....ng conflict between the two authorities resulting harassment to the importer. If the licence is granted for a particular item by the licensing authority the customs authority will have no right or power to go beyond the licence, Despite the passage of 20 years after the judgement was delivered, it is distressing to find the same situation. This judgement of the Court has been followed in number of decisions of the Tribunal. Therefore, if the Commissioner were of the view that the importer has misled the licensing authority or any other authority formulated by it with regard to the quantity that it required for manufacture of the export product, it is his duty and function to intimate the licensing authority so that authority can investigate into the matter and institute necessary proceedings against the licensee under the statute. It is not his function to overrule the decision of the licensing authority to decide whether a particular item could or not be imported. 8.The fact that the benefit of notification is available does not in any way alter this position. The right to import of the goods under the notification flows from the possession of the advance licence. No doubt othe....
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....or being eligible for granting of exemption under the said notification it is to be seen whether lignine sulphonate is as such or of a kind which is commercially known to be used in the manufacture of the said product so as to fall within the definition of 'material' as discussed in the preceding paragraph. He records the submission of the manufacturer that lignine sulphonate is commercially known to be used in the manufacture of resultant product. Thereafter he relies upon the statement of the Dy. General Manager of the appellant, which he finds have said : "in the correct terms lignine sulphonate is a dispensing agent which is never used in the manufacture of reactive dyes". 12.The Condensed Chemical Dictionary indicates as one of the use of lignine sulphonate as manufacture of dyestuffs although it is silent about the kind of dyes. Counsel for the appellants could not produce before us any material from any recognised technical literature to show that lignine sulphonate is used in the manufacture of reactive dyes. He, however, cites some patent application filed in the UK and India, which indicates in the manufacturing process, use of the lignine sulphonate in the reactive dy....