2023 (5) TMI 666 - AT - Customs

Entitlement to duty free clearance - Return (import) of export goods (unsold) - undeclared quantity of cut and polished diamonds - N/N. 45/2017- Cus dated 30th June 2017 - failure to declare the second box in the impugned consignment was found sufficient for depriving the goods of the benefit of the exemption notification to confirm recovery of duty liability - HELD THAT:- The order impugned here is the outcome of an appeal, filed by an importer whose grievance, and thereby the framework of the appeal itself, was limited to the points raised in appeal and section 118 of Customs Act, 1962 was not one among them for the same had been considered and dropped in the order appealed against. The provision, so deliberately dropped, could not have been revived in appeal within the boundaries noticed by the Hon’ble Supreme Court in the judgements by an appeal of Revenue or, in specific exercise of power so granted by the statute, by reframing of the issues in appeal but only after placing the appellant before it on notice of intent to do so.

By the failure of the confiscation upheld in the impugned order, the consequent penalty under section 112 of Customs Act, 1962 cannot be sustained. Moreover, the findings of the original authority are replete with observations about the mistake that occurred as well as the role of the ‘consol intermediary’ for not reflecting the contents of the consignment despite having issued ‘house airway bill (HAWB)’ in acknowledgement of having assumed custodianship of the package and its contents. The fastening of wrongdoing on the appellant, therefore, does not sustain.

It has ever been the claim of the appellant that the consignment in its entirety are unsold returns from the two export shipments affected by them in accordance with notification no. 45/2017-Cus dated 30th June 2017. No attempt was made to establish the veracity of the claim even in relation to the contents declared in the bill of entry before effecting seizure of the consignment of its entire on 24th February 2020. However, the lower authorities have acknowledged the eligibility, subject to ascertain, of the declared goods to such exemption; the principle so espoused cannot be withheld from the entirety of the consignment in view of mandated ‘first check’ appraisal of contents. The eligibility of the undeclared ‘cut and polished diamonds’ would adequately evidence the lack of motive in concealment, let alone deliberate attempt to evade duty.

As the goods are yet to be cleared for home consumption, there cannot be any prejudice caused to Revenue by exercise of authority under section 149 of Customs Act, 1962 to make appropriate alterations in the bill of entry for which the appellant may make formal application insofar as the ascertainment of claim for eligibility to exemption from duty is extendable to them is concerned.

The impugned order set aside except the extent of ascertainment of eligibility to notification no. 45/2017-Cus dated 30th June 2017 while modifying even that to cover the entire 410.17 carats - appeal disposed off.