Once an SEZ LOP Application is Approved, Unit Acquires SEZ Status and Becomes Eligible for an Exemption under Section 26 of the SEZ Act: Bombay High Court
The Bombay High Court ruled that once an SEZ LOP application is approved, the unit acquires SEZ status and becomes eligible for an exemption under Section 26 of the SEZ Act.
Background
The facts in all the petitions were almost identical barring minor differences. In all the matters, Sections 111(d) and 111(m) and Section 112(a) and Section 114A of the Customs Act, 1962 have been invoked and penalty imposed. In some cases, Section 118(a) of the Customs Act, 1962 has been invoked. Section 118(a) basically deals with confiscation of packages.
Issue raised
Whether Petitioners were permitted to import new/unused jewellery for remaking after melting.
Arguments
Advocate Vijay H. Kantharia, appearing for the Custom Authorities in all petitions, submitted that Rule has been issued only on the issue of jurisdiction and petitioner has an alternative remedy to challenge the order by filing an appeal.
He further submitted that the issue of jurisdiction of customs authorities to issue notice or take penal action under the Customs Act against a unit situated in the Special Economic Zone, came to be considered by the Gujarat High Court in the matter of Union of India V/s. Oswal Agricomm Pvt. Ltd., the Gujarat High Court, inter alia, held that the competent authorities under the Customs Act are still empowered to confiscate any goods under Sections 111 and 112 and impose penalty under Sections 113 and 114, in appropriate cases, even with regard to the units situated within the Special Economic Zone.
Decision
The division bench of Justice A.S. Doctor and Justice K.R. Shriram observed that the respondent has completely failed to appreciate the true intent and purport of Section 111(m) of the Customs Act while invoking the same. For invoking Section 111(m) of the Customs Act, the declaration made in an entry under the Customs Act, which is the Bill of Entry filed under Section 46 of the Customs Act, must fail to correspond, in value or any other particular, to the goods actually imported by petitioner.
It was further observed that Section 111(m) deals with intentional misdeclaration and mis-match between what has been declared on the Bill of Entry and what has actually been imported by the importer.
The bench held that there is absolutely no misdeclaration between the description and / or value declared in the Bill of Entry and the goods actually imported by petitioner, both being diamond studded gold and silver jewellery.
The court quashed and set aside the notices read with the addendums and addendum/corrigendum 2009 to the notice, as well as the orders of 2010 in all petitions.
It further discharged the petitioner from its obligation to renew the Bank Guarantee as furnished for provisional release at the time of admission of petitions. The Bank Guarantees be cancelled and returned to petitioners within eight weeks. Where consignments have not been released, such parties may apply for release. The application shall be granted within eight weeks.
Case title: M/s. Renaissance Global Limited v/s Union of India
Citation: Writ petition no.2003 of 2009
Date: 19.11.2022
