Court rules that movement from Free Trade Warehousing Zone to Domestic Tariff Area is a fresh import, not a re-import, rejecting exemption claims under Notification No. 45/2017-Cus.
In a significant judgment, the Delhi High Court has ruled against Baker Hughes Oilfield Services India Pvt. Ltd. and other appellants, denying their claims for re-import exemption on goods moved from a Free Trade Warehousing Zone (FTWZ) back to the Domestic Tariff Area (DTA). The court held that such movements are to be treated as fresh imports and not re-imports, thereby making the appellants ineligible for exemptions under Serial No. 5 of Notification No. 45/2017-Cus. The bench, comprising Justices Anil Kshetarpal and Shail Jain, emphasized that the original transaction concluded upon the completion of the initial contract and export condition, and the subsequent movement under a fresh Essentiality Certificate constitutes a new transaction.
Bottom Line :
Customs Law - Movement of goods from a Free Trade Warehousing Zone (FTWZ) back to the Domestic Tariff Area (DTA) under a fresh Essentiality Certificate (EC) does not qualify for re-import exemption under Serial No. 5 of Notification No. 45/2017-Cus. Such movement is treated as a fresh import and not a re-import, as the original transaction concluded upon completion of the initial contract and export condition.
Statutory provision(s): Customs Act, 1962, Notification No. 45/2017-Cus, Notification No. 50/2017-Cus, Special Economic Zones Act, 2005, Rule 48(3) of Special Economic Zones Rules, 2006, Circular No. 21/2019-Customs
