1. In this case, the Appellate Collector passed an order favourable to the respondents, giving them the benefit of lower rate of customs duty as applicable to Project Imports under Heading 84.66 of the Customs Tariff Act, 1975. The Govt. of India, being of the tent alive view that the appellate order was not correct in law, issued the subject show cause notice under the then Section 131(3) of the Customs Act, 1962 proposing to review the appellate order and passing appropriate order.
The grounds of the proposed review as set out in the subject show cause notice were that the respondents had failed to produce a list of items duly endorsed with Project Import by the Import Trade Control authorities and that they had not made any request for registration of the contract to the Custom House before clearance of the imported goods and thus they did not satisfy the condition which would entitle them to the benefit of the lower rate of duty under Heading 84.66 CTA. The subject show cause notice, on its transfer to this Tribunal under Section 131B(2) of the Customs Act, has been taken up as the present appeal before us.
2. During the hearing before us today, the appellant agreed that neither Tariff Heading 84.66 nor the Project Import Regulations required production of an endorsement for Project Import on the import licence. He maintained, however, that production of such an endorsement had become necessary by practice and it facilitated grant of the Project Import benefit to the concerned importer. But registration of the import contract before clearance of the imported goods was a statutory requirement. There was nothing on record to show that the respondents had applied for registration of their contract before clearance of the goods. The respondents denied this and invited our attention to the Appellate Collector's finding that the respondents did make the request which was turned down. When asked to show the evidence for it, they showed a photostat copy of their own letter dated 21.2.80, in the margin of which someone had made some illegible notation in manuscript and put his initials below that. This photostat copy could not establish that the original letter had been delivered to the Custom House. The identity of the person who made the noting in manuscript was unknown. The appellant maintained that this photostat copy was no proof of the respondents hating made a request for registration, that it was not the practice in Government offices to reject any party's application by returning the original application to the party, that the normal practice was to send a proper official reply to the party, that in this case neither any, application from the respondents nor any office copy of the reply given to them were on record with the Custom House and that the manuscript noting by some unknown person could not be taken as an order or decision of the competent Customs officer which in this case was an Assistant Collector of Customs. The appellant also stated that when the respondents applied for refund in May, 1980 they made no mention of their having applied for registration of their contract in February, 1980 and of the return of their application to them with the noting amounting to rejection of their request. The respondents maintained that they had applied for registration of the contract in good time and that their request had been rejected on the ground of non-production of Import Trade Control Authority's endorsement for Project Import and that since such endorsement was not required under the law, rejection of their request for registration was incorrect. The respondents relied on 1980 ELT 625 (Kerala) to say that since the jurisdiction of the Govt. of India was revisional in character, the Govt. could not treat the review proceedings as an appeal, and substitute its own conclusions on questions of fact in place of those arrived at by the Appellate Collector. Lastly, the respondents added that if the Order-in-Appeal passed in their case was revised to their disadvantage, they would stand discriminated against vis-a-vis M/s Modern Nets in whose case a similar Order-in-Appeal had, according to their knowledge, not been subjected to review proceedings.
3. We have carefully considered the matter. The Kerala High Court judgment cited by the respondents does not apply to the proceedings before us since, as already stated by us, the proceedings before us are deemed to be appeal proceedings. The only question requiring determination in this case is whether the respondents did or did not fulfil the pre-condition of registering their contract under the Project Import Regulations before clearance of the imported goods.
There is nothing on record with the Department to show that they made a request for registration. There is also no record of the request having been turned down. The respondents are unable to show us any proof that they did submit an application for registration of their contract to the Custom House. The photostat copy of their letter dated 21.2.1980 bearing some noting in manuscript in the margin by an unknown person establishes nothing. It is also curious that their detailed application for refund contains no mention of their application for registration or of its rejection by the Custom House. Since we find no evidence of their having applied for registration of their contract under the Regulations, we hold that they were not entitled to the benefit of lower rate of duty laid down in Heading 84.66 CTA. Accordingly, we set aside the impugned Order-in-Appeal and order that the Order-in-Original passed by the Assistant Collector rejecting the respondents' refund claim shall stand restored.