As per Notfn. 25/2002 Customs, concessional rate of duty is available on imported inputs used in the manufacture of specified finished goods. XYZ is importing Input “A” which is used to manufacture Intermediate Goods “B” and “B” in turn is used to manufacture the finished goods “C”. Now customs department is denying the concessional rate on ‘A’ since the same is not directly used for “C”. Any defence possible?
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