Baker Hughes Oilfield Services India Pvt Ltd Vs Customs Authority For Advance Rulings And Anr (Delhi High Court)
Summary: The Delhi High Court considered whether equipment initially imported into India at a concessional rate under Notification No. 50/2017-Cus. (“NN-50”), subsequently moved from the Domestic Tariff Area (DTA) to a Free Trade Warehousing Zone (FTWZ), and later brought back into the DTA under a fresh Essentiality Certificate (EC) for a new petroleum contract, could claim the residuary exemption under Serial No. 5 of Notification No. 45/2017-Cus. dated 30.06.2017 (“NN-45”). The Court dismissed the connected appeals and upheld the adverse advance rulings of the Customs Authority for Advance Rulings (CAAR).
The batch comprised CUSAA 43/2023, CUSAA 62/2023, CUSAA 63/2023 and CUSAA 66/2023, with CUSAA 43/2023 treated as the lead matter. The appellants were service providers/sub-contractors rendering technical mining and allied support services to oil and gas exploration and production companies in India. They proposed importing specialised equipment under NN-50 against an EC issued by the relevant contractor, using the equipment for the specified petroleum operation and, after completion of the contract, moving the same equipment to an LSP situated in an SEZ/FTWZ rather than physically exporting it outside India. No duty drawback, rebate or other export incentive was proposed to be claimed on the DTA-to-FTWZ movement. When another domestic contract was secured and a fresh EC issued, the appellants proposed to bring the same equipment from the FTWZ back into the DTA, claiming the concessional treatment under NN-50 together with the residuary exemption under Serial No. 5 of NN-45.
