NOTES ON ANTI DUMPING DUTY APPLICABILITY AGAINST THE IMPORTS UNDER AA,EOU,SEZ,EPCG and IGCR

 1.ADD is exempt only for imports under AA,EOU and SEZ

https://www.dgtr.gov.in/faq Directorate General of Trade Remedies FAQ

Q.20. Does the levy of Anti Dumping duty on a particular product extend to all imports of that product? Which imports are exempt from such duty ?

Ans. The levy of anti dumping duty is both exporter specific and country specific.

It extends to the imports from only those countries in respect of which dumping has been alleged and the complaint has been filed and duty recommended.

Such duty will not apply to the imports from other countries in respect of which the domestic industry has not alleged dumping.

However, the anti dumping duty is not payable on imports against the Advance License scheme or on imports by the 100% EOUs /EPZ units, even if such imports are from the countries under complaint.

 

2 ADD is not exempt for imports under EPCG

 

The customs Notification number 26/2023 dated 1st April, 2023 regarding EPCG, Sl 1(ii) does not mention the ADD section 9A of the Customs Tariff Act, 1975 in exempted additional duties list hence imports under EPCG is not exempted from ADD

 

3.Imports under IGCR

 

The Customs (Import of Goods at Concessional Rate of Duty or for Specified End Use) Rules, 2022 Rule 2 ( b) reads as follows;

“ an importer intends to avail the benefit of any notification and such benefit is dependent upon the use of the goods imported being covered by that notification for the manufacture of any commodity or provision of output service or being put to a specified end use”

 

It is clear that IGCR rules is applicable for the importers ( category : manufacturers) for   the specified end use of the materials imported and there is no condition on the export of finished goods made out of raw material imported under IGCR. Hence there is no exemption from Anti dumping duty for the imports under IGCR

PRIOR MSME REGISTRATION IS MANDATORY BEFORE ENTERING INTO CONTRACTS OTHERWISE MSME BENEFITS CAN'T BE CLAIMED

 Whether a MSME though had not been registered at the time when the contract was entered into between the parties but is registered during the subsistence of the contract and in such circumstances, whether such party which enter into the contract would be entitled to the benefits under the MSME Act?

 Held- No. Hon’ble Delhi High Court inter alia observed that the purpose of Section 17 and 18 of the MSME Act is to grant a cost-effective dispute resolution mechanism for recovery of unpaid dues of the supplier, which is a micro, small and medium level enterprise. The said Section gives the right to a micro, small and medium enterprise to have its disputes adjudicated by approaching the Facilitation Councils and it cannot be obliterated on account of any other contract to the contrary. Hon’ble Court reliance placed on Apex Court judgement in Gujarat State Civil Supplies Corporation Limited v. Mahakali Foods Private Limited (Unit 2) & Anr., 2023 (6) SCC 401, reads as under:- " 51. Following the above stated ratio, it is held that a party who was not the "supplier" as per Section 2(n) of the Msmed Act, 2006 on the date of entering into the contract, could not seek any benefit as a supplier under the Msmed Act, 2006. A party cannot become a micro or small enterprise or a supplier to claim the benefit under the Msmed Act, 2006 by submitting a memorandum to obtain registration subsequent to entering Into the contract and supply of goods or rendering services. If any registration is obtained subsequently, the same would have the effect prospectively and would apply for the supply of goods and rendering services subsequent to the registration. The same cannot operate retrospectively. However, such Issue being jurisdictional Issue, if raised could also be decided by the Facilitation Council/Institute/Centre acting as an Arbitral Tribunal under the Msmed Act, 2006. xxx 52.6. A party who was not the "supplier" as per the definition contained In Section 2(n) of the Msmed Act, 2006 on the date of entering into contract cannot seek any benefit as the "supplier" under the Msmed Act, 2006. If any registration is obtained subsequently the same would have an effect prospectively and would apply to the supply of goods and rendering services subsequent to the registration." The same view has been taken by a Coordinate Bench of Delhi Court in Malani Construction Company v. Delhi International Arbitration Centre & Ors., 2023 SCC OnLine Del 1665, wherein this Court has observed as under:- "14. 

The ratio of these two judgments is clear to the effect that if the registration under the MSMED Act, 2006 was obtained subsequently, the benefits under the said Act would not apply. Even in a situation where some portion of the goods/services are supplied prior to registration and some are supplied post registration, the Act would apply, depending on the facts, only qua the goods and services which are supplied subsequent to the registration."

Order Date : January 30, 2024 Mahanagar Telephone Nigam Ltd (Petitioner) Vs. Delhi International Arbitration Centre, Through Its Co Ordinator & Ors(Respondents) High Court of Delhi W.P.(C) 14515/2023 & CM APPL. 57558/2023

Dispute is based on the Inspection Report of the Chartered Engineer - Enhancement as per estimated new equipment value at the Year Of Manufacture is set aside

CESTAT CHENNAI

M/S. TECHNIGROUP INTERNATIONAL PRIVATE LIMITED VERSUS COMMISSIONER OF CUSTOMS, CHENNAI

Customs Appeal No. 40535 of 2014 AND Customs Appeal No. 40536 of 2014

Order No. - FINAL ORDER NOs. 41117-41118 / 2023

Dated: - 13-12-2023

Judgment / Order

HON’BLE MR. P. DINESHA, MEMBER (JUDICIAL) And HON’BLE MR. M. AJIT KUMAR, MEMBER (TECHNICAL)

Shri N. Viswanathan, Advocate for the Appellant

Shri Harendra Singh Pal, Assistant Commissioner for the Respondent

ORDER

Order : [Per Hon’ble Mr. P. Dinesha]

These appeals are filed by the importer- appellant against the common Order-in-Appeal C.Cus. No. 1835 & 1836/2013 dated 19.12.2013 passed by the Commissioner of Customs (Appeals), Chennai.

2.1 The present dispute lies on a very narrow compass; the admitted facts are that the importer imported ‘used office furniture’ declaring a certain value which was not accepted by the Revenue. Hence, the Department required the assistance of a Chartered Engineer to evaluate the exact value of the imported used furniture.

2.2 Accordingly, the Chartered Engineer vide Inspection Report dated 05.08.2013 gave his report whereby the said Chartered Engineer has considered new equipment value and arrived at a different value for the imported goods in question.

3. Best on the above Inspection Report of the chartered engineer, the original authority vide Order- in-Original No. 21933/2013 dated 16.09.2013 and Order-in-Original No. 21932/2013 dated 19.09.2013 has rejected the declared value of the used goods and has determined the value at an enhanced rate. The difference is about Rupees two lakhs and the officer has given an option to redeem the same on the payment of redemption fine of Rs.5,00,000/- and Rs.10,00,000/- respectively, apart from penalty of Rs.2,00,000/- and Rs.5,00,000/- respectively under Section 112 (a) of the Customs Act, 1962.

4. It appears that the importer filed appeals before the first authority and the first appellate authority having considered the plea of the importer–appellant, per impugned Order-in-Appeal has partly allowed the appeals of the appellant by reducing the redemption fine to Rs.3,00,000/- and Rs.5,00,000/- respectively and also by reducing the penalty imposed to Rs.1,00,000/- and Rs.2,50,000/- respectively. It is this order that has been appealed before us.

5. Heard Shri N. Viswanathan, Ld. Advocate for the appellant and Shri Harendra Singh Pal, Ld. Assistant Commissioner. The only issue that arises for our consideration is: whether the adjudicating authority is justified in determining the value of the used imported goods?

6.1 Facts are not in dispute; the only dispute is based on the Inspection Report of the Charted Engineer. We have perused the Inspection Report filed by the Chartered Engineer which is placed on record. They said Chartered Engineer has not disputed that the goods in question were in fact used goods. At paragraph 2.6 of his report, the said engineer is giving an estimated new equipment value at the YOM; other than this, the said engineer has not considered any other similar goods which were imported at about the same time/date.

6.2 Moreover, as observed by us in the above paragraph, he has given an estimated value of new equipment, which is not comparable since, admittedly, the imported goods were used goods/equipment and not new equipment, as observed in the Inspection Report. Hence, the Inspection Report does not inspire any confidence as regards the valuation is concerned and hence the reliance placed on the same is not the correct position. Hence, the lower authority has clearly erred in solely relying on the said inspection report, which is of no evidentiary value.

7. In view of the above, we are constrained  to ignore the said report, and consequently, the re-valuation as well, which is solely based on the said report. In that view of the matter, we set aside the impugned order and allow the appeals.

( Order pronounced in the open court on 13. 12. 2023 )

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