Southern Electronics Bangalore Vs. the Commissioner of Customs - Court Judgment

Excerpt:
1. this appeal arises from the oia no. 26/2004 dated 25.02.2004 by which the benefit of exemption notification no. 21/2002 and 23/2002-cus both dated 01.03.2002 has been denied to the appellants on various grounds by the commissioner (appeals). the benefit of notification is available in respect of basic, additional and special duty of customs in respect of components imported for manufacture of parts of aircraft/gliders and later used in the manufacture of gliders/aircraft by m/s. hindustan aeronautics limited, a psu unit. the appellants could not produce the certificate at the initial stage. however, they produced the same at a later stage before the original authority and the commissioner (appeals). the authenticity of the certificate is not in challenge. the ground taken is that the late production of the document cannot be accepted as it would amount to re-assessment of the bill of entry. this ground is challenged by the appellants on the ground that there is no question of the re-assessment of the bill of entry. the issue pertains to grant of benefit of the notifications only. there was no violation of the notifications except that the required certificate was produced belatedly. (i) jindal vijayanagar steels ltd. v. cc, mangalore final order nos. 54 & 55/2006 dated 12.01.2006 of the bangalore bench of the cestat (ii) goa shipyard ltd. v. cc, acc, sahar 2006 (72) rlt 479(cestat-mum.) (iii) m/s. kaveri telecoms ltd. v. cc, bangalore final order no. 118/2006 dt. 31.01.2006 (tri.-bangalore)cc, bangalore v. integra micro systems (p) ltd. (v) cce, chennai v. dynaspede integrated systems ltd. 2002 (147) elt 541 (tri.-chennai) (vii) sonic band international v. cce, vadodara 1999 (109) elt 524(t)century textiles & industries ltd. v. cc, mumbaicc (imports), mumbai v. tullow india operations ltd.canon india pvt. ltd. v. cc, mumbai 2006 (74) rlt 251 (cestat-del.) the learned counsel submits that it is a well laid down law that the parties can produce the certificate at a belated stage. merely because the certificate has been produced at a belated stage, that will not give room for the authorities to reject the claim. he further submits that it is not a case of re-assessment of bill of entry but only a case of grant of the benefit of the notification on production of the required certificate. the certificate was produced before the original authority and the ground given for rejection is not as per law and in terms of the well laid down judgments cited supra.3. the learned jdr reiterated the findings given by the commissioner (appeals).4. on a careful consideration, we notice that the appellants were required to have produced the certificate from m/s. hal for use of the said components in the said aircrafts. there was a delay in getting the certificate. the certificate was produced before the original authorities. the same was required to have been accepted. the grounds taken by the authorities that it amounts to re-assessment of the bill of entry is not correct. the appellants are not seeking reassessment of the bill of entry but are only claiming the benefit of the notification. the claim made subsequently supported with the essentiality certificate is not denied. in the light of the ratio of the cited judgments (supra), the benefit is required to be granted.this bench, in the case of cc v. integra micro systems (supra), has held that the exemption cannot be denied on the sole ground of belated submission of certificate such delay is only a procedural violation.the same view has been expressed in the case of bajaj tempo ltd. (supra), sonic band international (supra) and century textiles and industries ltd. (supra). the apex court also, in the case of cc v.tullow india operations ltd. (supra), has held that once the assessee satisfies the eligibility clause, then the exemption clause is required to be liberally interpreted and the benefit is required to be extended.in view of the well settled law cited supra, the impugned order is not legal and proper and the same is set aside by allowing the appeal with consequential relief, if any.

Judgment:
1. This appeal arises from the OIA No. 26/2004 dated 25.02.2004 by which the benefit of exemption Notification No. 21/2002 and 23/2002-Cus both dated 01.03.2002 has been denied to the appellants on various grounds by the Commissioner (Appeals). The benefit of Notification is available in respect of basic, additional and special duty of customs in respect of components imported for manufacture of parts of aircraft/gliders and later used in the manufacture of gliders/aircraft by M/s. Hindustan Aeronautics Limited, a PSU Unit. The appellants could not produce the certificate at the initial stage. However, they produced the same at a later stage before the original authority and the Commissioner (Appeals). The authenticity of the Certificate is not in challenge. The ground taken is that the late production of the document cannot be accepted as it would amount to re-assessment of the Bill of Entry. This ground is challenged by the appellants on the ground that there is no question of the re-assessment of the Bill of Entry. The issue pertains to grant of benefit of the Notifications only. There was no violation of the Notifications except that the required Certificate was produced belatedly.

(i) Jindal Vijayanagar Steels Ltd. v. CC, Mangalore Final Order Nos.

54 & 55/2006 dated 12.01.2006 of the Bangalore Bench of the CESTAT (ii) Goa Shipyard Ltd. v. CC, ACC, Sahar 2006 (72) RLT 479(CESTAT-Mum.) (iii) M/s. Kaveri Telecoms Ltd. v. CC, Bangalore Final Order No. 118/2006 dt. 31.01.2006 (Tri.-Bangalore)CC, Bangalore v. Integra Micro Systems (P) Ltd. (v) CCE, Chennai v. Dynaspede Integrated Systems Ltd. 2002 (147) ELT 541 (Tri.-Chennai) (vii) Sonic Band International v. CCE, Vadodara 1999 (109) ELT 524(T)Century Textiles & Industries Ltd. v. CC, MumbaiCC (Imports), Mumbai v. Tullow India Operations Ltd.Canon India Pvt. Ltd. v. CC, Mumbai 2006 (74) RLT 251 (CESTAT-Del.) The learned Counsel submits that it is a well laid down law that the parties can produce the Certificate at a belated stage. Merely because the certificate has been produced at a belated stage, that will not give room for the authorities to reject the claim. He further submits that it is not a case of re-assessment of Bill of Entry but only a case of grant of the benefit of the Notification on production of the required certificate. The Certificate was produced before the original authority and the ground given for rejection is not as per law and in terms of the well laid down judgments cited supra.

3. The learned JDR reiterated the findings given by the Commissioner (Appeals).

4. On a careful consideration, we notice that the appellants were required to have produced the certificate from M/s. HAL for use of the said components in the said aircrafts. There was a delay in getting the Certificate. The Certificate was produced before the original authorities. The same was required to have been accepted. The grounds taken by the authorities that it amounts to re-assessment of the Bill of Entry is not correct. The appellants are not seeking reassessment of the Bill of Entry but are only claiming the benefit of the Notification. The claim made subsequently supported with the Essentiality Certificate is not denied. In the light of the ratio of the cited judgments (supra), the benefit is required to be granted.

This Bench, in the case of CC v. Integra Micro Systems (supra), has held that the exemption cannot be denied on the sole ground of belated submission of Certificate such delay is only a procedural violation.

The same view has been expressed in the case of Bajaj Tempo Ltd. (supra), Sonic Band International (supra) and Century Textiles and Industries Ltd. (supra). The Apex Court also, in the case of CC v.Tullow India Operations Ltd. (supra), has held that once the assessee satisfies the eligibility clause, then the exemption clause is required to be liberally interpreted and the benefit is required to be extended.

In view of the well settled law cited supra, the impugned order is not legal and proper and the same is set aside by allowing the appeal with consequential relief, if any.