| Re-imported
goods liable for payment of customs duty - Supreme Court
The
Supreme Court has held that machinery which is exported out
of India for repairs and thereafter re-imported into India
would also be liable to Customs duty under the provisions of
the Customs Act, 1962, and the benefit of exemption under
Notification No. 13/81 could not be claimed by the assessee
in such cases (Tata Tea Ltd. V. Commissioner of Customs
reported in AIR 2000 Supreme Court 376)
Notification
No. 13/81 has been issued by the Central Government in
exercise of the powers conferred under Section 25(1) of the
Act Customs Act. Vide the said notification, the Central
Government has exempted capital goods, inter alia, when
imported into India for the purpose of manufacture of
articles for export out of India by 100% EOUs provided that
the importer has been granted necessary licence for the
import of the goods for the said purpose.
In
the above case, the assessee, which had imported certain
machinery in 1982, from Germany and installed the same in
its Tea Factory in Kerala, sent the same to Germany for
repairs in the year 1992. The machinery was repaired and
re-exported to India and exemption was claimed from payment
of customs duty under Notification No.13/ 81. The said
exemption was denied by the assessing authority, but allowed
by the appellate authority. The Revenue preferred an appeal
before the Tribunal, which was allowed against which the
assessee filed an appeal before the Supreme Court.
The
Tribunal had ruled in favour of the Revenue after making an
analysis of the applicable statutory provisions, the
Import-Export Policy and the Notification No. 13/81 and
concluded that exemption is granted only to the goods
imported for the first time in India and the notification
does not cover the goods already imported and sent abroad
for the purpose of repairs and them re-imported to India.
Upholding
the decision of the Tribunal, the Supreme Court held that
under Section 20 of the Customs Act, read with the
definition of "import", imported goods would
include re-imported goods as well as therefore the goods
sent out of India and re-imported would also be liable to
payment of duty in the same manner in which they would have
been liable if imported for the first time in India.
Accordingly, the appeals were dismissed.
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