Custom, Excise & Service Tax Tribunal
Arising Out Of The Order-In-Appeal ... vs M/S Surya Food & Agro Ltd on 5 July, 2012
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
Date of Hearing : 5.7.2012
For Approval & signature :
Honble Ms. Archana Wadhwa, Member (Judicial)
Honble Shri Mathew John, Member (Technical)
1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of the order?
4. Whether order is to be circulated to the Department Authorities?
Custom Appeal No. 81 of 2008 with
Cross Objection No. 126 of 2008
[Arising out of the Order-in-Appeal No.342-CUS/APPL/KNP/2007 dated 31.10.2007 passed by the Commissioner (Appeals), Customs & Central Excise, Kanpur)
CCE, Kanpur Appellant
Vs.
M/s Surya Food & Agro Ltd. Respondent
Custom Appeal No. 82 of 2008 with Cross Objection No. 127 of 2008 [Arising out of the Order-in-Appeal No.341-CUS/APPL/KNP/2007 dated 31.10.2007 passed by the Commissioner (Appeals), Customs & Central Excise, Kanpur) CCE, Kanpur Appellant Vs. M/s Kanpur Edible Pvt. Ltd. Respondent Appearance:
Appeared for Appellant : Shri A. Jain, A.R.
Appeared for Respondent : Shri R. Santhanam, Advocate
CORAM: Honble Ms. Archana Wadhwa, Member (Judicial)
Honble Shri Mathew John, Member (Technical)
Order No.dated.
Per Mathew John :
Two appeals by Revenue are being considered in this proceeding along with cross objections filed by the Respondents in each case.
2. The Respondents imported Bakery Shortening and filed Bills of Entry No. 557 dated 22-06-2006 and 587 dated 27-06-2007 at ICD JRY Kanpur. The Respondents claimed exemption from Customs duty under Notification 26/2000-Cus dated 01-03-2000 which was applicable to such goods imported under Indo Sri Lanka Free Trade Agreement (ISLFTA for short).
3. On 02-06-2006, DGFT had issued public Notice that such goods to be imported under ISLFTA could be imported only by NAFED. So Revenue was of the view that the goods imported on 22-06-2006 and 27-06 2007 were not eligible for the said exemption and the Respondent should have paid duty as applicable without claiming such exemption. Based on such reasoning two Show Cause Notices were issued in December 2006 and adjudicated confirming a duty demands of Rs. 82,19,877/- and Rs. 1,44,43,358/- along with interest. The respondents filed appeal with Commissioner (Appeal). Commissioner (Appeal) held that the goods were imported under a Letters of Credit opened prior to 02-06-2006 and therefore the changes in import policy made on 02-06-2006 would not apply to the consignments and the importer was eligible for concession under Notification 26/2000-Cus and set aside the orders of the adjudicating authority. While passing the order the Commissioner (Appeal) relied on in para 1A.5 of the Import Policy providing transitional provisions in case of change in import policy and also Notification 22 (RE-2006)/2004-2009 dated 24th July 2006 and Notification 32 (RE-2006)/2004-2009 dated 11th September 2006. After the issue of notification dated 11-09-2006 import of goods where the goods left the factory of the manufacturer before 02-06-2006 by persons other than NAFED were also considered to have satisfied the conditions of ISLFTA.
4. Aggrieved by the order of the Commissioner (Appeal) Revenue has filed these appeals.
5. The Ld A.R. for Revenue submits that on date of filing of Bill of Entry, Bakery Shortening could have been imported under ISLFTA only by NAFED. For claiming exemption under Notification 26/2000-Cus condition No. 4 of the Notification was required to be satisfied. This condition read as under:
(4) the importer follows the procedure as may be specified by the Government of India from time to time.
6. It is the contention of AR that on the date of filing of the Bill of Entry the said condition is not satisfied in respect of the impugned goods in as much as goods were not imported by NAFED and hence duty concession was not available.
7. He further argues that transitional provisions in Foreign Trade Policy can apply only in respect of import restriction and not in respect of duty concessions. In respect of duty concessions the change is effective from the date of notification. So on the dates when the Bills of Entry were filed the concessional rate could not have been extended to the Respondent. He further argues that notification dated 14-07-2006 and 11-09-2006 by DGFT can have no effect on imports in the past. So the demand was rightly confirmed in the adjudication and the Commissioner (Appeal) has erred in setting aside the order.
8. Opposing the prayer, the Counsel for appellants submit that a change in import policy cannot apply for consignments imported under contracts agreed into prior to the change of policy. In this case the goods were imported under letters of credit opened prior to the change in import policy. There was no manipulation to avail exemption that was available for goods imported under the earlier policy. The argument that changes in duty rates will apply from the date of notification will apply only to notification issued under the Customs Act. In this case change is through notification issued by DGFT. So the policy adopted for giving effect to such policy will apply for duty concession also. That is to say that once it is agreed that the goods are considered to be imported under ISLFTA, the duty concession becomes automatically available.
9. The Counsel relies on the decision of the Hon. Punjab Haryana High Court in Krishna Udyog Vs. UOI - 2007 (207) ELT 194 (P&H).
10. We have considered arguments on both sides. We find that the issue is already decided by the Hon Punjab and Haryana High Court in the case of Krishna Udyog Ltd. The Ld A. R. has not been able to point out any difference in facts of this case as compared to facts of that case. So following the said decision we reject the appeals filed by Revenue. Consequently the cross objections filed by Respondents also gets disposed of.
(Pronounced in open Court) (Archana Wadhwa) Judicial Member (Mathew John) Technical Member RM