Commissioner of Customs (EP) vs Hindustan Unilever Ltd.

Under 20 advance licences the respondent-assessee was permitted to import 11.31 crores number of inner cartons for packing the soap manufactured by the assessee. Admittedly, under the said licences, the assessee had imported 9.10 Crore number of cartons and after packing the same with soap had exported 9.88 Crore cartons by utilizing the imported cartons as well as indigenous cartons. Although, the total quantity imported was less than the quantity permitted to be imported under the 20 advance licences, it appears that in some licences quantity imported were shown to be more than the quantity permitted to be imported under those licences. Based on the above facts, proceedings were initiated and by order-in-original the duty with fine and penalty were confirmed.

On an appeal filed by the Assesses, the Tribunal by the impugned order set aside the order-in-original 2012 (278) ELT 618 . Challenging the said order, the present appeal is filed.

The grievance of the Revenue is that when the imports are licence specific, the imports effected under that particular licences cannot be used for the manufacture and export of the final products under another licences. The finding of fact recorded by the Tribunal is that firstly the Licensing Authority has found that the conditions attached to the said 20 advance licences have been complied with and accordingly granted export obligation discharge certificate in respect of those 20 licences. Secondly, the total quantity of cartons imported is admittedly less than the quantity permitted under the 20 licences and the quantity exported is more than the quantity imported under the 20 licences. Thirdly having not raised any objection at the time of import, the customs authorities are not justified in raising objection after the fulfilment of the export obligation to the satisfaction of the licensing authorities. Moreover, the customs notifications under which the goods in question have been imported, itself permit the manufacturer-importer after fulfilling the export obligation to use the excess imported material in the manufacture and sale of goods under other licenses. In these circumstances, we see no reason to entertain this appeal and the same is hereby dismissed with no order as to costs.