Judgment M.M.Kumar, J. 1. The revenue has approached this Court by filing this appeal under Section 35G of the Central Excises and Salt Act, 1944 challenging the order dated 29-12-2004 passed by the Customs Excise and Service Tax Appellate Tribunal, New Delhi while disposing of C/Appeal No. 410/2003-NB(C). The revenue has claimed that following substantial question of law arises for our determination : Whether Tribunal have committed error in allowing the benefits of CBEC Circular No. 60/99, dated 10-9-1999 without fulfilling the conditions as said down in the circular? 2. The facts are not in dispute. The assessee respondent is 100% Export Oriented Undertaking and had entered into a contract with M/s. Gauthier S.A. of France for the supply of Rice Processing machinery. However, French firm supplied only a Calorimetric sorting machine, one Electrical Control Panel and a set of spare parts which were cleared under Bill of Entry dated 8-8-1997. The foreign supplier could not supply the rest of the machinery as it went into liquidation. As such the Calorimetric sorting machine could not be used without the rest of the components and other parts. The machinery remained unused ever since its import and the 100% Export Oriented Unit could not be set up and commissioned. The foreign supplier accepted the request made by the assessee-respondent to take back the machinery shipped by them. The assessee also approached the Custom authorities and Development Commissioner of Noida Export Processing Zone for granting necessary permission for re-export of the goods vide letters dated 23-12-1998 and 30-4-2001. In the absence of grant of permission the foreign supplier backed out without any option with the assessee- respondent but to abandon the goods. The assessee eventually surrendered the goods vide letter dated 7-8-2001 leaving it to the Customs Department to dispose of the same in any manner they like. The assessee-respondent also approached the Development Commissioner for de-bonding of the unit and for discharging the bond executed with the Department stating that the Development Commissioner vide letter dated 12-2-2002 had conveyed their consent for withdrawal of 100% Export Oriented Unit and allowing in principle of de-bonding of the unit. However, the request was rejected for surrender of capital goods on the ground that the assessee-respondent had failed to fulfil the condition Nos. 3, 5 and 6(1) of the notification dated 30-6-1997 which requires the manufacture, production, packaging, job work or service in Customs Bonds. However, the request was rejected for surrender of capital goods on the ground that the assessee-respondent had failed to fulfil the condition Nos. 3, 5 and 6(1) of the notification dated 30-6-1997 which requires the manufacture, production, packaging, job work or service in Customs Bonds. The capital goods were required to be installed in the bonded premises within a period of one year from the date of import. The appeal filed by the assessee-respondent was rejected by the Commissioner (Appeals) on the ground that their case is neither a case of clearance of goods for home consumption nor a case of deposit of goods in the warehouse. 3. On appeal to the Tribunal, the assessee-respondent was given the benefit of circular dated 10-9-1999 by observing as under : We have considered the submissions of both the sides. The Central Board of Excise and Customs under Circular No. 60/99-Cus., dated 10-9-1999 has considered the difficulties of EOU., etc. faced by them in regard to replacement of goods imported and found damaged or defective or otherwise unfit for use. The Board after examining the matter issued the instructions that has to be followed by field formations in regard to the goods imported and found damaged or defective or otherwise unfit for use. The relevant portion of the instructions reads as under : (B) Goods imported and found defective/damaged or otherwise unfit for use. (i) The units may be allowed to receive free replacement of the goods imported and found defective, damaged or otherwise unfit for use, prior to re-export of the same. However, re-export of such defective/damaged or otherwise unfit for use goods may be subsequently made later. (ii In case, the supplier of such defective, damaged or otherwise unfit for use goods does not insist on re-export of such goods, the same may not be re-exported subjected to the condition that such goods shall be either destroyed with the permission of Assistant Commissioner of Customs/Central Excise in charge of unit or cleared into DTA on payment of full custom duty. A perusal of the Boards circular clearly reveals that these instructions apply to goods imported and found defective/damaged or otherwise unfit for us. As per the Circular first, the importer is to be allowed free replacement of the goods and subsequently re-export may be allowed. A perusal of the Boards circular clearly reveals that these instructions apply to goods imported and found defective/damaged or otherwise unfit for us. As per the Circular first, the importer is to be allowed free replacement of the goods and subsequently re-export may be allowed. In case the supplier does not insist on re-export of the goods the same has to be destroyed or cleared into DTA on payment of customs duty. The Boards circular does not apply only to defective or damaged goods, it also applies to the goods which are  otherwise unfit for use . It has been contended by the appellants which has not been rebutted by the Revenue that calorimetric sorting machine imported by them was not for use for want of the entire machinery for which they had placed order with the foreign supplier. As the machinery in question was unfit for use and the foreign supplier is not insisting on re-export of the same the only option available to the Appellants was to abandon the goods for which permission is available to them under the Boards Circular dated 10-9-1999. Accordingly, we set aside the impugned order and allow the appeal filed by the Appellants. 4. Mr. Kamal Sehgal, learned Counsel for the revenue has made two fold submissions before us. According to the learned Counsel the benefit of the circular dated 10-9-1999 could not be extended to the assessee-respondent as the bill of entry was presented on 8-8-1997. According to the learned Counsel, the circular issued on 10-9-1999 cannot be applied retrospectively. He has also submitted that according to Para 12A of the notification dated 3-6- 1997, which deals with the recovery of custom duty, certain conditions are required to be fulfilled before the prayer of the assessee-respondent could be accepted for destruction of the goods. In that regard, he has made detailed reference to the order dated 25-4-2003 passed by the Commissioner (Appeals) (Annexure A.3). 5. Mr. K. Kumar, learned Counsel for the assessee respondent has, on the other hand, argued that there are categorical findings that the Calorimetric sorting machine imported by the assessee was not fit for use for want of entire machinery for which they had placed order with the foreign supplier. 5. Mr. K. Kumar, learned Counsel for the assessee respondent has, on the other hand, argued that there are categorical findings that the Calorimetric sorting machine imported by the assessee was not fit for use for want of entire machinery for which they had placed order with the foreign supplier. Learned Counsel has maintained that the machinery in question was unfit for use and the foreign supplier was not insisting on re-export of the same and therefore the only option available to the assessee was to abandon the goods which is permissible by circular dated 10-9-1999. Mr. Kumar has also submitted that the circular dated 10-9-1999 is not retrospective merely on the basis that the bill of entry was presented on 8-8-1997. According to the learned Counsel the application seeking the benefit of circular was filed on 25-10-2002 (Annexure A. l) where the prayer for destruction of imported goods was made. He placed reliance on condition no.12 A of the notification dated 3-6-1997 and further reliance was placed on circular dated 10-9-1999. 6. After hearing the learned Counsel for the parties we are of the considered view that this appeal lacks merit and is thus liable to be dismissed. There are categorical findings recorded by the Tribunal to the effect that the entire machinery for which the assessee had placed the order with the foreign supplier, had not been supplied resulting into its non-installation. The machinery received in part became unfit for use and the foreign supplier has not even insisted on re-export of the same. Therefore, the only option left with the assessee was to abandon the goods by seeking permission as per the requirement of circular dated 10-9-1999. In that regard reference is made to sub-clause (B) of clause 2 of the circular which reads as under : 2. The matter has been examined. I am directed to say that following instructions may be followed in this regard : (A) xx xx xx xx xx (B) Goods imported and found defective/damaged or otherwise unfit for use. (i) The units may be allowed to receive free replacement of the goods imported and found defective, damaged or otherwise unfit for use, prior to the export of the same. However, re-export of such defective/damaged or otherwise unfit for use goods may be subsequently made later. (i) The units may be allowed to receive free replacement of the goods imported and found defective, damaged or otherwise unfit for use, prior to the export of the same. However, re-export of such defective/damaged or otherwise unfit for use goods may be subsequently made later. (ii In case, the supplier of such defective, damaged or otherwise unfit for use goods does not insist on re-export of such goods, the same may not be re-exported subject to the condition that such goods shall be either destroyed with the permission of Assistant Commissioner of Customs/Central Excise in charge of unit or cleared into DTA on payment of full customs duty. 7. A perusal of the afore-mentioned clause makes it evident that in case the goods supplied are unfit for use and the supplier does not insist on re-export then such goods are required either to be destructed with the permission of the Assistant Commissioner of Customs/Central Excise, Incharge of the unit or cleared into DTA on payment of full customs duty. The circular appear to have been issued on account of difficulties being faced by the export oriented units like the petitioner in regard to replacement of goods imported or exported which have been found to be damaged or defective or otherwise unfit for use. Therefore, there arises no substantial question of law warranting admission of the appeal. The appeal is wholly without any merit and the same is, accordingly, dismissed.