Full Judgment
2. Shri R. Nambirajan, the learned advocate, who appeared on behalf of the respondents, pleaded that an endorsement on the import licence is not a mandatory requirement and the benefit of project import can be extended if the contract had registered before the clearance of the goods. In support of his arguments, he cited the Tribunal's judgment in the case of Saurashtra Cement and Chemical Industries Ltd v. Collector of Customs, Ahmedabad, reported in 1983 ECR 570D (CEGAT). He laid special emphasis on para 4 of the said judgment, and pleaded for the rejection of the appeal.
3. We have heard both the sides and have gone into the facts and circumstances of the case. it is not disputed by both the sides that an application for registration of the contract was filed before the clearance of the goods. The matter is fully covered by an earlier decision of the Tribunal in the case of M/s Saurashtra Cement & Chemical Industries Ltd. (supra). Para 4 from the said judgment is reproduced below: We have carefully considered the matter. We agree with the appellants that the Collector by granting registration, after considering their explanation for delay had, impliedly, accepted their explanation and it was, therefore, not fair on his part to make the question of delay a ground for proceeding against the appellants later. We also agree with the appellants that their failure to produce the Project Import endorsement on their import licence or a Recommendatory Letter to that effect was not a bar to their availing of the benefit of Heading 84.66 if otherwise due to them. As regards the Collector's charge of suppression of facts on the part of the appellants, we find force in their grievance on this count too. No such allegation was contained in the show cause notice issued by the Collector, and consequently, the appellants were not heard on this count. The Collector's order holding the appellants guilty of suppression of facts was, therefore, a unilateral one and this part of his order has to be struck down on that ground alone.
Even on merit, we find no substance in the charge that the appellants were guilty of suppression of facts. No doubt, they made no clear declaration in the body of their application for registration that their imports in question were for modernisation and replacement only. It is also true that it would be rather too much to expect the authorities to come to this conclusion through the devious method of co-relating the voluminous contract with the industrial licence. Yet, if the Collector really felt that only imports for initial setting up of a unit for substantial expansion of an existing unit alone were entitled to be assessed under Heading 84.66, we wonder why he registered the appellants' contract at all in the first instance when there was no declaration anywhere in the application submitted by them or in the documents enclosed therewith that the imports were for initial setting up of a unit or for substantial expansion of an existing unit. On the other hand, whatever vague and incomplete information the appellants did furnish, for example, the subject heading in their letters and application for registration and their leaving the column relating to capacity in the application for registration blank, it pointed to the proposition that the contract was not for initial setting up of any unit or for expansion of an existing unit. In the circumstances, the charge of suppression of facts on the part of the appellants cannot stand.
We follow our earlier decision and hold that an endorsement on the import licence for the grant of benefit of project import under heading 84.66 is not a mandatory requirement. Accordingly, in view of these observations, we do not find any merit in the Revenue's appeal. The appeal is dismissed.