CVD Exemption Benefit Can Be Claimed Later Even If Not Initially Invoked: CESTAT [Read Order]

The Chandigarh Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) held that  Countervailing Duty (CVD) exemption benefits under customs notifications can be claimed even if not invoked at the earlier stage.

Garg Impex,appellant-assessee,was engaged in importing and trading Polyester Knitted Fabric from China. The assessee imported several consignments and filed Bills of Entry, declaring the value based on commercial invoices and submitting all required documents. On examination, the goods matched the declarations.

However, the Assessing Authority(AA) relied on a DRI alert and proposed a higher import value, assessing the goods provisionally at USD 2.80 to 2.85 per kg. The assessee paid the duty on this enhanced value to avoid delays and additional charges.

Later, the AA confirmed the higher value and denied the benefit of Countervailing Duty (CVD) exemption under Notification No. 30/2004-CE. Additionally, benefits under other exemption notifications related to customs duty and haulage charges were denied for some consignments.

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The assessee filed an appeal, but the Commissioner (Appeals) rejected them, upholding the higher value based on the Directorate of Revenue Intelligence (DRI) alert. The Commissioner also noted that the appellant had not challenged the denial of CVD exemption earlier.

The assessee then appealed before the tribunal.

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The two member bench comprising S.S.Garg(Judicial Member) and P.Anjani Kumar(Technical Member) reviewed the arguments and documents from both sides and focused on whether the appellants were entitled to exemption from payment of CVD under Notification No. 30/2004-CE dated 09.07.2004.

The appellate tribunal noted that the issue had been addressed in several previous cases, including the decision in M/s Artex Textile Private Limited [2017 (9) TMI 1011], where it had held that the benefit of exemption under Notification No. 30/2004-CE was available in light of the Supreme Court ruling in SRF Ltd. vs. CC, Chennai [2015 (318) ELT 607 (S.C.)]. In that case, the Apex Court held that when the condition regarding non-availment of CENVAT credit did not apply to the importer, denial of exemption could not be sustained.

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The tribunal further rejected the objection that the benefit had not been claimed at the time of filing Bills of Entry, relying on the Supreme Court's ruling in Share Medical Care vs. UOI [2007 (209) ELT 321 (S.C.)], which held that a claim for exemption cannot be denied solely because it was not made initially.

Additionally, the CESTAT observed that the assessee had already been allowed the benefit of Notification No. 072/2005 dated 22.07.2005 and Notification No. 151-Cus dated 14.05.1982 by the Commissioner (Appeals) through respective orders passed in 2017 and 2016.

In light of these findings and by following the legal precedents, the tribunal held that the impugned orders were not legally sustainable and accordingly set them aside, allowing the appeal with consequential relief to the assessee.

To Read the full text of the Order CLICK HERE

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