Compliance with Transitional Arrangement prior to when Watermelon Seeds placed under Restricted Category from free category: CESTAT grants benefit of Import [Read Order]

The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) granted benefit of import as there was compliance with Transitional Arrangement prior to when the watermelon seeds were placed under the restricted category from free category.

The appellant had filed a Bill of Entry for clearance of Watermelon Seeds falling under Customs Tariff Heading 12077090. It appeared that the impugned goods were restricted vide Notification No. 03/2015-20 dated 26.04.2021 and import thereof was allowed subject to the Policy Condition No. 4 of the Chapter 12 of the Customs Tariff Act, 1975. As the appellant failed to fulfil the conditions stipulated in the said notification, the goods appeared to be liable for confiscation and therefore, the impugned goods were placed under the seizure.

The Counsel who appeared on behalf of the appellant submitted that the entire case of the department is based upon the fact that at the time of filing Bill of Entry and clearance of the goods there was restriction as per the foreign trade policy on import of the impugned goods. It is his submission that by the date on which the restriction was imposed, the goods had already reached India and were due for clearance and that in this fact restrictions placed under foreign trade policy shall not apply when the goods are in transit.

The counsel also argued that in the present case there is no dispute that the shipment of import was made within the original validity period of an irrevocable commercial letter of credit, therefore the restriction was imposed post shipment of imported goods, such restriction shall not apply in the facts of the present case. In this regard, he referred to all the import documents which shows that Para 1.05 (b) is applicable. Accordingly, the restriction is not applicable. Consequently, the entire case of the department fails.

A Two-Member Bench comprising Ramesh Nair, Judicial Member and Raju, Technical Member observed that “The aforesaid documents were admittedly submitted before restriction imposed in import of “watermelon seeds” brought vide DGFT Notification No. 3/2015-20dated 26.04.2021. From the above documents it is undisputed that the appellant had complied with the stipulation of Transitional Arrangement as per Foreign Trade Policy as the appellant had paid entire amount of the consignment in question much prior to watermelon seeds being placed under restricted category from free category. Therefore, in our considered view the appellant are eligible for consequential benefit of import qua FTP provisions.”

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates