Custom
TRT-2025-
Cestat Bangalore
Date:-03-02-23
In:-
Issue Favourable to Tax Payer ?:-
Order Date – 03 February 2023
Parties: M/s. Kerala Horticultural Devolopment Programme Vs Commissioner of Customs, COCHIN-CUS
Facts –
- The Appellant, M/s. Kerala Horticultural Devolopment Programme, imported items of plant and machinery during the period from 1996-99 pursuant to an agreement and paid customs duties.
- The appellant claimed the benefit of the exemption notification dated 18.07.1994, as according to the appellant the cost of the machinery that was imported was not to be repaid to the European Union. The same was rejected as the import could not be treated as a free gift to enable the appellant to claim the benefit of the exemption notification.
Issue –
- Whether the import can be treated as a free of gift to enable the benefit of the exemption notification?
Order –
- The Tribunal observed that as per the amended clause 3 of the agreement provides that the Agro-Processing Component was increased from 4.108 million euro to 7.196 million euro and out of this amount, the capital investment cost (85%) was to be provided as a “grant‟ and the “working capital‟ (15%) was to be provided as a loan to be repaid in a revolving fund.
- Thus, the plant and machinery, which would be included in the capital investment cost, was provided as a “grant‟ which means as a gift. Clause 8 of the exemption notification would, therefore, be satisfied. Also the Certificate clearly mentions that the plant and machinery was gifted free of cost to the Programme under the bilateral Agreement between the Government of India and the European Union.
- Hence the appeal is allowed.
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