- (1.) It is not in dispute that the writ petitioners availed the benefit of duty exemption/remission scheme, which appears to have been propounded in order to facilitate export of the finished fabrics, raw materials whereof might have been imported from abroad. The obligation of the importer is however to export the goods without changing their contents. In this case fabric was imported. The writ petitioners allegedly used that fabric for the purpose of making pants and thereafter exported the pants. The obligation was that the writ petitioner shall manufacture and export the pants of the same fabric which he had imported from abroad. The case of the revenue is that the imported fabric contained 52% of polyester, 45% cotton and 3% spandex. The sample of the pants exported was drawn. The test of the sample revealed that the pants contained 98% of cotton and 2% spandex yarn.
(2.) It is, therefore, amply clear that the goods imported were not utilised for the purpose of making those pants. The imported goods might have been utilised for the purpose of sale in the domestic market and some other goods purchased from the domestic market might have been utilised for the purpose of making pants which were ultimately exported. The revenue in the circumstances, issued a notice dated 11th July, 2011 claiming and contending inter alia as follows: "The importer submitted a bond at the time of importation and agreed with conditions mentioned in the said bond. They have failed to fulfill the conditions mentioned therein. Therefore, the duty concession amounting Rs. 20,21,378/ - (Rupees twenty lakh twenty one thousand three hundred seventy eight only) for importation goods above at (i) and (ii) along with applicable interest thereon is recoverable under Sec. 28 of the Customs Act, 1962."
(3.) The writ petitioner replied to the notice dated 11th July, 2011 stating as follows: "In this connection we would like to confirm that the sample against shipping Bill No. 3450 dated 27 -12 -2002 has been drawn by you and the said shipping Bill has been finally assessed by your office as per photocopy attached. Here we would like to point out that we have exported garments made out of the same fabric that we imported under the said advance license and the export obligation has been 100% fulfilled. We are enclosing a copy of the certificate issued by the Office of the joint DGFT confirming the same. Under the above circumstances you are requested to kindly treat the matter as closed.";