AUTOLITE INDIA LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) THE challenge in this petition is to the orders passed by the customs authorities denying duly free clearance of the goods imported by the petitioner under the duty free advance licence granted to them by the licensing authorities.

(2.) THE petitioner is a Small Scale Industrial Unit engaged in the manufacture and export of autohead lamps, tail lamp, etc. It is the case of the petitioner that for the manufacture of the aforesaid items, various raw materials and components, including die steel are required. The petitioner accordingly applied for and obtained an advance licence in terms of EXIM policy 88-91 inter alia for import of die steel. The licensing authority has also issued duty exemption entitlements certificate/pass book so as to enable the petitioner to import die steel without payment of duty.

(3.) IN the light of the advance licence, the petitioner placed an order for imports of die steel from Austria. On arrival of the goods, the petitioner filed a bill of entry for clearance of die steel duty free as per Exemption Notification 116/1988. The Assistant Commissioner of Customs by his order dated 7-6-1989 disallowed the benefit of Notification No. 116/1988 on the ground that die steel imported is not in the nature of raw materials for manufacture of export goods but is meant for manufacture of moulds as capital goods, which is not falling within the scope of Notification No. 116/1988. In other words, it was held that the die steel is not directly used in the manufacture of export product and hence benefit of Notification No. 116 of 1988 cannot be extended to the petitioner. Being aggrieved by the aforesaid order, the petitioner filed an appeal before the Collector of Customs (Appeals), who by his order dated 15-11-1989 (Exhibit G to the petition) dismissed the appeal by holding the customs authorities are not bound by the error committed by the licensing authorities. The Appellate Authority held that the petitioner cannot be allowed the benefit of the exemption notification as the die steel imported are raw materials for manufacture of capital goods namely mould and not raw material for the manufacture of the export goods namely autohead lamps, tail lamps, etc. Challenging the said order, the petitioner has filed the present petition.