2026-VIL-1550-CESTAT-MUM-CU
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CUSTOMS CESTAT Cases

Customs - EPCG Scheme duty exemption - Fulfillment of Conditions through Subsequently Produced Documents - Confirmation of Duty Demands - Appellant imported capital goods for which import duty was foregone and executed bonds undertaking to fulfill export obligation. Department found that appellant had failed to produce Capital Goods Installation Certificate upon importation and had not submitted Export Obligation Discharge Certificate in terms of applicable notification - Demand of duty foregone amount along with interest under Section 143 of the Customs Act and confiscation under Section 111(o) read with penalty under Section 112(a) - After passage of impugned order appellant obtained installation certificates and EODC - Whether adjudged demands for duty foregone can be sustained when requisite export obligation has been fulfilled and EODC issued by competent licensing authority and installation certificates obtained subsequent to adjudication - HELD – Upon examining the documents placed in the appeal records including the letter issued by the Deputy Commissioner of Customs cancelling bonds executed for availing duty exemption and installation certificates from the jurisdictional Central Excise authorities, the requisite compliance with the notification conditions had been fulfilled by the Appellant. Non-production of EODC at the time of adjudication was beyond the control of the appellant as the same was not issued by the competent authorities despite action by the appellant for export of specified goods having been completed for fulfillment of export obligation and necessary documents having been submitted to DGFT - The proper course of action for the original authority would have been to keep the notice pending till the licensing authority had responded one way or the other rather than proceeding with haste to dispose of the SCN. The Customs authorities having themselves accepted the EODC and cancelled the bonds after passing the impugned order constituted apparent contradiction with their earlier confirmation of duty demands for non-production of EODC - No merits in confirmation of adjudged demands based on the premise of non-submission of requisite documents by the appellant - The impugned order to the extent it had confirmed the duty demands along with imposition of redemption fine and penalty is set aside - The appeal is allowed
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