CESTAT Kolkata Sets Aside MOOWR Interest Demand for Capital Goods

CESTAT Kolkata's Ruling on MOOWR Interest Demand

The CESTAT Kolkata has set aside a significant interest demand on customs duty applicable to capital goods cleared from a MOOWR warehouse. The Tribunal clarified that the necessary requirement revolves around the 'intended for use' rather than actual use, leading to the conclusion that the demand was not justified.

In the present case, the Tribunal carefully considered the statutory provisions regarding the clearance of capital goods under the MOOWR scheme, observing that the prior interpretation overlooked the distinction between intended use and actual application of the goods in question.

This ruling has critical implications for businesses operating under the MOOWR framework, suggesting that companies may avoid interest liabilities if they can substantiate intended use without actual deployment of the imported capital goods.