TARAJYOT POLYMERS LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) This batch of eight Writ Petitions have been filed at the instance of Transferees of Duty Free Import Authorisation (in short, 'DFIA') praying for the issue of a Writ of declaration declaring section 93 of Finance Act 2009 ultra vires the Foreign Trade (Development) Act, 1992, the Foreign Trade Policy and relevant Hand Book of Procedure, the Customs Act, 1962, Notification No. 40/2006 - CUS dated 01.05.2006 and Articles 14, 19(1)(g), 21 and 265 of the Constitution of India.

(2.) The facts as relating to W.P.No. 8334 of 2013, Tarajyot Polymers Limited are taken to be representative of all matters in the batch. The petitioner is a trader in plastic granules and imports the same under the Duty Free Import Authorisation Scheme (DFIA) under para 4.4.1 and 4.4.2 of the Foreign Trade Policy read with Notification No. 40 of 2006 - Cus dated 1.5.2016. The Petitioner, a transferee of DFIA, purchased the scrips and utilised the same for discharging duty liability against various Bills of Entry under Notification No. 40 of 2006 and 17 of 2009 dated 19.2.2009. Show cause notices were issued by the Additional Commissioner Of Customs dated 11.1.2011 calling upon the petitioner to show cause why additional duty along with interest from the date of clearance not be recovered from it on the materials imported under various bills of entry as per Notification 40 of 2006 as amended by condition (iii) of Notification No. 17 of 2009 - Customs along with penalty under section 114-A of the Customs Act 1962.

(3.) The basis of the show cause notice was that the petitioner had not declared at the time of clearance of the goods, the fact that CENVAT credit had been availed of by the original licence holders, Virgo Polymers (I) Pvt. Ltd, Big Bags India Pvt. Ltd., (BBI) Bangalore and others. Since there had been no declaration as called for in terms of clause (iii) of Notification 17 of 2009, additional Duty had not been levied. Upon notice, BBI had confirmed the position that CENVAT credit had indeed been availed of by them in respect of inputs procured indigenously and used for the manufacture of the goods exported. The show cause notice alleged that this fact was within the knowledge of the assessee since additional duty had been remitted in respect of earlier clearances under the DFIA scheme.