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Subject News *  Documentary evidence dominates probe, further custody unwarranted: mumbai court grants bail in Rs. 22.44 crore customs duty evasion case. *  Business premises can’t remain sealed for non-participation in GST search: Allahabad High Court. *  GST pre-deposit must be refunded proportionately when taxpayer partly succeeds in appeal: Bombay High Court. *  Supreme Court grants 30 days to file GST appeal; keeps pre-deposit issue open due to deposit in parallel CGST proceedings. *  GST demand can’t exceed amount proposed in SCN: Allahabad High Court quashes Rs. 20.47 Crore order. *  Hundreds-of-crores GST demand and heavy 10% pre-deposit no ground to bypass statutory appeal: Punjab & Haryana High Court. *  Delhi High Court refuses to entertain challenge to gold confiscation due to statutory appeal remedy and unexplained delay. *  Procedural error in customs broker licence inquiry can be rectified through remand: Delhi High Court. *  GSTR-2A mismatch alone can’t justify ITC denial without invoice-wise verification; personal hearing mandatory: GSTAT. *  GST order passed without uploading personal hearing notices violates sec. 75(4): Allahabad High Court. *  TAX EVASION - Sec. 74 GST SCN quashed for not spelling out fraud, wilful misstatement or suppression: Allahabad High Court. *  STPI’s SOFTEX certification and NoC charges taxable as business support services: CESTAT. *  Suspicion can’t replace proof: CESTAT quashes penalty in alleged gold-smuggling operation. *   Limitation runs from communication of order: Madras High Court upholds rejection of delayed GST Appeals. *  Rajasthan High Court quashes GST demand over unsigned show cause notice. *  ITC recovery upheld where supplier failed to deposit GST: Rajasthan High Court. *  Customs commissioner’s empowered to make port trust liable for duty on pilfered goods: Supreme Court. *  Rectification proceedings can’t be used to challenge an uncontested GST assessment through a writ petition: Andhra Pradesh HC. *  GST proceedings against deceased proprietor unsustainable without notice to legal heir: GSTAT. *  Mere availment of ineligible self-assessed ITC doesn’t amount to suppression without evidence of fraud or wilful misstatement: GSTAT. *  Disposal of mining overburden by entity authorised by mining lease holder constitutes taxable service: CESTAT. *  Toll plaza data not mandatory for ITC refund: GSTAT. *  Disputed GST fraud allegations require investigation: Punjab and Haryana High Court makes interim bail absolute in alleged fraud and GST fraud case. *  Non-manufacturer contractor liable to deposit excess excise duty collected from buyer: CESTAT. *  GST order can’t reject taxpayer’s reply as “not satisfactory” without reasons: Madhya Pradesh High Court. *  Uncorroborated statements can’t establish alleged diversion of duty-free goods: CESTAT. *  Erection services were not liable to service tax prior to 10th september 2004: CESTAT. *  Sec. 74 GST notice must spell out statutory ingredients for invoking extended tax demand proceedings: Allahabad High Court. *  No jurisdictional bar under section 6(2)(b) in parallel CGST SGST proceedings: Delhi High Court refuses to bypass GST appeal remedy. *  Madras High Court remits GST demand for fresh adjudication after taxpayer claims it was unaware of SCN following business closure.  

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PJ/Case Laws/2011-12/1349

Permission for re-export of machinery parts imported for jobwork purpose

Case: Craftsman Automation Pvt. Ltd. versus Commissioner of Customs
 
Citation: 2011 (271) ELT 554 (Tri. – Chennai)
 
Issue:- Re-export of parts of machinery imported earlier for undertaking jobwork – re-export sought as supplier not wanting to continue the work and demanded return of goods – whether permission can be denied?
 
Brief Facts:- Appellants imported parts of printing machinery from M/s. Beijing Mitsubishi Heavy Industries Beiren Print­ing Machinery Co. Ltd., China in the month of August 2008. They had imported the same for the purpose of undertaking job work. They have undertaken job work using some quantity of the parts imported and exported the resultant sub-assemblies to the above mentioned supplier in China. It is claimed that due to slow down in economic activities the supplier did not want further job work to be done by the appellant and asked for return of the balance of imported parts as such. The ap­pellants made the request for re-export for balance of goods received by them which was rejected by the Commissioner.
 
Hence, appellant is before the Tribunal.
 
Appellant’s Contention:- Appellant contended that the goods were im­ported only for the purpose of job work; that they are not the owners of the goods; that as the supplier has chosen not to continue the work and sought for the return of the balance of the goods, they were under the obligation to return the goods as such. He relies on the decision of the Tribunal in the case of Kerala Hi- Tech Industries Ltd. v. CCE, Cochin [2001 (132) E.L.T. 593] wherein re-export of goods imported in similar circumstances was permitted. Appellant also relies on the decision of the Tribunal in the case of Also Marine & Harvests Ltd. v. CC, Cochin [2007 (216) E.L.T. 405] and submits that the law does not expect anything which is impossible to be done in their case, as the goods belong to the supplier and they do not want the job work to be done, it becomes inevitable on their part to return the balance goods and keeping the goods by them has become impossible. Appellant also relied on Para 2.35 of the Foreign Trade Policy which per­mits re-export of imported goods in the same or substantially in the same form provided that the item to be imported or exported is not restricted for import or export.
 
Respondent’s Contention:- Revenue submitted that the condition of the notification for re-export is not fulfilled.
 
Reasoning of Judgment:- The Tribunal noted that Notification No. 93/2004 permits "where the materials are found defective or unfit for use, the said materials may be re-exported back to the foreign supplier within three years from the date of payment of duty on the importation thereof, provided that at the time of re-­export the materials are identified to the satisfaction of the Deputy Commis­sioner of Customs or Assistant Commissioner of Customs, as the case may be, as the materials which were imported."
 
It was held that the reasoning given by the Commissioner is that the appellants have used part of the imported consignments for manufac­turing the sub-assemblies and exported and therefore the remaining parts cannot be held to be defective or unfit for use. There is no doubt that the goods cannot be treated as unfit for use. However, it is the case where the supplier has not permitted the appellants to use any further.
 
It was held that it is not as if no permission is being granted by the customs authori­ties for re-export of the imported goods. The Foreign Trade Policy (Para 2.35) permits re-export of imported goods provided there is no restriction on the im­port and the export. For example, in cases of wrong supply re-export is being permitted. Even in cases of mis-declaration, the request for re-export is being considered after subjecting the goods to adjudication for the offence of mis-declaration.
 
The Tribunal held that in the present case it has not been alleged that there is any restric­tion on the import of the goods or for export of the same goods. If duty has been paid at the time of import, the re-export as such has to be governed by the provi­sions of Section 74 of the Customs Act, 1962 on the quantum of drawback.
 
In the present case, the goods have been imported duty-free i.e. subject to nil assessment. The appellants are only asking for re-export of the goods in the circumstances mentioned above. The reasoning adopted by the Commissioner for rejecting re-export cannot be appreciated. It is not the case that the condition of the notification has been violated and therefore the Commis­sioner has held the goods to be liable for confiscation or has demanded any duty. Therefore, the order of the Commissioner rejecting the request for re-export can­not be sustained. The same is set aside. The Commissioner shall allow re-export subject to the appellants proving that the goods sought to be exported are the same as the goods which were imported.
 
Decision:- Appeal allowed.

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