The customs authorities cannot deny exemption under one notification based on conditions pertaining to another, particularly when the Import License remains valid without challenge.

JUSTICE DILIP GUPTA:

This appeal seeks to assail the order dated 19.02.2025 passed by the Principal Commissioner of Customs ACC (Import), New Customs House, New Delhi, the Principal Commissioner that confirms the customs duty on M/s. Narrondass Manordass, the appellant in respect of goods imported with interest under section 28AA of the Customs Act, 1962 , the Customs Act and penalty under section 112(a)(i) of the Customs Act.

2. The issue that arises for consideration in this appeal is whether the appellant is justified in availing exemption of customs duty under Notification No. 96/2008-Cus dated 13.08.2008, the 2008 Exemption Notification on import of gold dore bars from Tanzania in terms of the Import License dated 13.06.2022 issued by the Directorate General of Foreign Trade, DGFT permitting imports subject to Notification No. 12/2012-Cus dated 17.03.2012, the 2012 Notification

3. In the Doha Ministerial Order of the World Trade Conference held in 2001, the member countries, including India, committed to consider providing duty free, quota free market access for Least Developed Countries products and to consider additional measures to improve market excess to such countries. In the Hong Kong Ministerial Declaration held in 2005, the World Trade Organisation countries agreed to provide duty free and quota free market access on a lasting basis on all products originating from Least Developed Countries. The Government of India, in 2008, extended duty free tariff preference scheme for the Least Developed Countries.

4. Accordingly, the 2008 Exemption Notification was issued on 13.08.2008 in exercise of the powers conferred by section 25(1) of the Customs Act. It exempted goods falling under the First Schedule to the Customs Tariff Act, 1975, other than those specified in Appendix I and Appendix II, from the whole of duty of customs as specified in the First Schedule to the Customs Tariff Act and from the whole of Agriculture Infrastructure and Development Cess, AIDC leviable under section 124 of the Finance Act, 2021, the 2021 Finance Act when imported to India from a country listed in the Schedule to the Notification.

5. On 17.03.2012, the 2012 Notification was issued extending benefits of concessional rate of basic customs duty as well as additional duty to certain goods, including gold dore bars at Serial No. 318 having gold content not exceeding 95% subject to Condition No’s 5 and 34. Condition No’s 5 and 34 are reproduced below:

6. Customs Notification No. 50/2017, the 2017 Notification was issued on 30.06.2017 superseding the 2012 Notification. This Notification extended benefit of concessional rate of basic customs duty to gold dore bars under Serial No. 354 subject to two Conditions at Serial No’s. 9 and 40 which are identical to Condition No’s 5 and 34 of the 2012 Notification.

7. On 13.06.2022, the DGFT issued Import License to the appellant permitting the appellant to import gold dore bars with purity upto 95%. The Conditions contained in the License are as follows:

2. CONDITION SHEET

8. The appellant filed a Bill of Entry on 26.06.2023 for import of gold dore bars from Tanzania and claimed exemption of duty under the 2008 Exemption Notification. The appellant also filed the country of origin certificate. Investigation was carried out and it was revealed that the appellant had wrongly claimed exemption under the 2008 Exemption Notification since the Condition of the Import License issued by the DGFT specifically mentioned that the goods shall be cleared under the 2012 Notification later superseded by the 2017 Notification.

9. The appellant received a Pre-Notice Consultation Letter dated 09.04.2024 alle