The Andhra Pradesh High Court has provisionally allowed installation of equipment and generated solar power to supply for home consumption.
The bench of Justice G.Narendar and Justice T.C.D.Sekhar has observed that the applicability of Section 65 of the Act and the prohibition contained under the Manufacturing and Other Operations in a Customs Bonded Warehouse (MOOWR Regulations) has been the subject matter of the decision.
The petitioner/assessee has been permitted to import certain equipment for the production of solar energy.
The Department has also granted Customs Private Bonded Warehouse License in favour of the petitioner, under Licence Nos. 9 of 2024 and 10 of 2024, in exercise of the powers vested in it under Section 58 of the Customs Act, 1962. The dispute now centres around the clearance of the products from the warehouse for home consumption.
Para 2 of Licence No.9 of 2024 enables the petitioner to establish a private bonded warehouse in the premises at Sy.Nos.791 & 794 of Chennakkapally Village, Gadivemula Mandal, Nandyal, Andhra Pradesh (300 MW AC Solar Power Project) for importing and warehousing of the capital goods viz., Monocrystalline Bifacial Solar PV Modules/Panels falling under Customs Tariff Heading: 8541 upto the amount of customs duty i.e., Rs.294.80 crores.
Similarly, Para 2 of Licence No. 10 of 2024 enables the petitioner to establish a private bonded warehouse (700 MW AC Solar Power Project) for importing and warehousing of the same capital goods upto the amount of customs duty i.e., Rs.687.86 crores.
Conditions of the licence are imposed in Para 5 of the licences. Clause (i) of Para 5 mandates strict observance of the provisions of the Act. Clause (ii) mandates compliance with the regulations laid down under the Private Warehoue Licensing Regulations. Clause (vi) mandates that the licence holder shall bind himself to pay any duties, interest, fine and penalties that may arise or become payable in respect of the warehoused goods. It is in compliance with this clause that bonds for a sum of Rs.2070.00 crores and Rs.885.00 crores have been given by the petitioner to protect the interest of the Department.
The petitioner sought the stay on the operation of the Instructions issued by the Respondent department as well as provisionally allow the Petitioner to use the goods (as imported into the private bonded warehouse as set up under Section 58 of the Customs Act) for setting up of its solar power project, within the customs bonded area, during the pendency of the present Writ Petition.
The issue raised was whether the respondent Department was right in attempting to negate the permission under Section 65 of the Act, after having permitted not only the establishment of the warehouse but also the import of the equipment.
The court stayed the stay the operation of the proceedings subject to the condition that the interim order shall remain in operation till any orders that may be passed by the Apex Court in the pending SLP (C) No.20274-20281 of 2024 preferred by the Central Board of Indirect Taxes and Customs.
The court directed the State Bank of India, Jubilee Hills Branch, Hyderabad, to deduct a sum equivalent to 15% of the payment received under the PPAs dated 02.02.2022 and 07.07.2022 and retain the sum in a fixed deposit until orders from the Court.
The court clarified that interim order will not entitle the petitioner to seek for refund of any amounts that have been paid under protest. All payments made and received shall be subject to final orders.
Case Details
Case Title: M/s Greenko versus CBIC
Case No.: WP NO: 28047 OF 2024
Date: 09/12/2024
Counsel For Petitioner: Sr. Adv. Sujit Ghosh Assisted By V Akshaya Babu
Counsel For Respondent: Santhi Chandra
