Absence of COO Marking on Aluminium Scrap Not Ground to Deny Exemption: CESTAT Sets Aside Duty Demand Against Jindal Aluminium Ltd [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai Bench, has set aside the denial of exemption benefit holding that absence of country-of-origin (COO) markings on aluminium scrap cannot be a ground to deny concessional duty under the ASEAN–India Free Trade Agreement (AIFTA).

The Tribunal allowed the appeal filed by the assessee and held that the benefit of exemption under Notification No. 046/2011-Cus dated 01.06.2011 is admissible. It further ruled that denial of exemption based solely on absence of physical COO markings is unjustified when documentary evidence sufficiently establishes origin.

The appellant Jindal Aluminium Ltd. imported Aluminium Scrap Tread from Singapore. The appellant filed three Bills of Entry claiming exemption under AIFTA on the basis of a valid Certificate of Origin.

However, in the course of the first check examination the customs authorities observed that the goods did not bear any marking relating to the country of origin. The exemption was thus denied and the duty was demanded. The demand was thus paid under protest. The Commissionerof Customs has upheld the denial of exemption as a result an appeal has been filed.

The assessee has contended that the Aluminium Scrap does not ordinarily bear any marking such as made in Singapore because it is not a manufactured product. The Rules of Origin do not provide for marking in such cases. All the necessary documents were verified without any discrepancy.

The Department has contended that the goods were not identified because of the lack of marking and description.

The Bench comprising Ajayan T.V. (Judicial Member) and M. Ajit Kumar (Technical Member) observed that the goods were clearly described in the Bills of Entry and matched the description in the Certificate of Origin. It noted that all relevant documents were verified and no discrepancies were found.

Accordingly, the Tribunal held that absence of COO markings on scrap goods does not impair their identification and particularly when documentary evidence is complete and reliable. The Tribunal set aside the impugned order and allowed the impugned goods the benefit of exemption from Basic Customs Duty under Notification No. 046/2011-Cus dated 01.06.2011.

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