Commissioner of Customs Vs Brightpoint India Pvt. Ltd. (CESTAT Chennai)
The Department appealed against an order of the Commissioner (Appeals), Chennai, which had allowed an importer to claim the concessional rate of Countervailing Duty (CVD) of 1% under Notification No. 12/2012-CE for imported mobile phones. The importer had initially paid CVD at 12.5% on the Maximum Retail Price (MRP) basis along with applicable National Calamity Contingent Duty for imports made between May and July 2015. It subsequently claimed the concessional rate, contending that the condition relating to non-availment of CENVAT credit stood satisfied. The original authority rejected the claim, but the Commissioner (Appeals) allowed the benefit by relying on the Supreme Court’s decision in SRF Ltd.
The Department argued that exemption notifications must be strictly construed and that the importer had failed to satisfy the mandatory condition regarding non-availment of CENVAT credit. It contended that this condition was intrinsically linked to the manufacturing process and could not be presumed to have been fulfilled in the case of imported goods. It further submitted that the decision in SRF Ltd. could not be applied in view of subsequent clarifications and amendments.
The Tribunal identified the issues for determination as whether the importer was entitled to the concessional CVD under Notification No. 12/2012-CE and whether the order of the Commissioner (Appeals) was sustainable. It observed that additional customs duty under Section 3(1) of the Customs Tariff Act is levied to maintain parity between imported goods and like goods manufactured in India. While noting an earlier Tribunal decision on the nature of additional duty, it held that the issue had to be examined in light of the binding Supreme Court judgment in SRF Ltd.
