NANYA IMPORTS & EXPORTS ENTERPRISES versus COMMISSIONER OF CUSTOMS, CHENNAI

Citation: [2006] 3 S.C.R. 1037 · Decided: 10-04-2006 · Supreme Court of India · Bench: ASHOK BHAN · Disposal: Appeal(s) allowed

Judgment (excerpt)

NANY A IMPORTS & EXPORTS ENTERPRISES 
A 
v. 
COMMISSIONER OF CUSTOMS, CHENNAI 
APRIL 10, 2006 
(ASHOK BHAN AND LOKESHWAR SINGH PANT A, JJ.] 
B 
Customs Act' 1962; 
Section 25-Exemption Notification No. 2011999 covering insoles, 
midsoles and sheets thereof-"PU coated leather fabrics" used in the leather C 
footwear industry as "insoles and midsoles" 'imported in the form of "sheets" 
but rolled up for the convenience loading and safe transport-denial of the 
benefit of exemption on the ground that goods imported were not "sheets" 
but 'films' or 'running sheets '-Held, goods entitled to the benefit of the 
exemption Notification. 
D 
Appellant is a partnership firm dealing in the business, inter alia, of 
leather footwear materials and accessories. One of the items regularlyl, 
imported by the appellant is "PU coated leather fabrics" which are extensively 
used in the leather footwear industry as "insoles and midsoles. Appellant 
received a consignment of PU coated insoles sheets for leather fabrics at 
Chennai in June, 1999. Revenue ("the respondent" herein) denied the benefit 
of the Notification No. 20/99. Appellant waived show cause notice and the 
_personal hearing and placed submissions before the adjudicating authority 
based on the earlier imports by it and the order passed by the Commissioner 
therein. The adjudicating authority held that though the end use of the subject 
goods was established, but denied the benefit of the Notification No. 20/99 to 
. the appellant on the ground that the subject goods were not "sheets" but 
"films" or "running sheets" and therefore, not entitled to the exemption from 
customs duty. Aggrieved by the above, the appellant preferred an appeal before 
the Customs Excise and Gold (Control) Appellate Tribunal, South Zone Bench 
E 
F 
at Chennai (for short.'.'the Tribunal") which was dismissed by the impugned G 
order. 
For the appellant it was strenuously contended that the impugned goods 
had been imported by the appellant in the form of "sheets" but for loading 
convenience; the sheets, being 50 metres long and the material being highly 
1007 
H 
I 
1038 
SUPREME COURT REPORTS 
[2006] 3 S.C.R. 
A nexible, had been rolled up for loading, which did not detract from the facts 
that the goods were sheets in rolls. The Notification merely required the goods 
to be in the form of sheets in contradistinction to being cut in shapes and 
forms. There is no distinction between being in rolls or loose sheets. It was 
further contended that the issue as to whether the subject goods imported in 
B rolls had already been the subject matter of several judicial pronouncements, 
some of them between the parties, were binding on the revenue as the same 
had attained finality. 
For the respondent it was contended that the goods imported by the 
appellant were no "sheets" but "films" 'or running sheets' and therefore, 
C not entitled to the exemption from customs duty. 
Allowing the appeal, the Court 
HELD 1.1. The goods, "PU coated leather fabrics" extensively used in 
the leather footwear industry as "insoles and midsoles," imported in the form 
D of the sheets being 50 metres long, rolled up as specified by the ISi standards 
for loading and safe transportation, would not convert them into 'films' or 
'sheetings' thereby denying the assessee the benefit of the exemption 
Notification. (1039-D-E; 1041-G-H; 1045-B-C) 
Collector of Customs, Bombay v. Mis. K. Mohan and Company Exports, 
E 119891 2 sec 337, distinguished 
F 
P/ast Fahs v. Collector of Customs, (1993) 66 ELT 441; Mod Apparel 
Exports v. CC Calcutta, (1996) 14 RL T 174 (CEGA T); order dated 11.6.1996 
of the High Court of Calcutta in C.A. No. 1717of1995 and Tirupati Garments 
& Anr. v. Union of India & Ors., referred to. 
2.1. The burden of proof as to whether the item in question is taxable 
in the manner claimed by the revenue is on the revenue. Mere assertion in 
that regard is of no use. It is for the taxing authority to lay evidence in that 
behalf. (1044-H; 1045-AI 
G 
Union of India and Ors. v. Garware Nylons Ltd. & Ors., (1996) 10 SCC 
H 
413 and Hindustan Ferodo Ltd v. Collector of Central Excise, Bombay, (19971 
2 sec 677, relied upon. 
CIVIL APPEL LA TE JURISDICTION : Civil Appeal No.1520 of 2001. 
t 
' 
NANY A IMPORTS & EXPORTS ENTERPRISES 1·. COMMR. OF CUSTOMS, CHENNAI [BHAN,J.] } 039 
From the find Order No. 547/2000 dated 25.4.2000 of The Customs, A 
Excise & Gold (Control) Appellate Tribunal, South Zonal Bench at Chenn

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