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Customs - Case Laws
Showing 41 to 60 of 96 Records
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2020 (9) TMI 605 - CESTAT NEW DELHI
Imposition of penalty u/s 114(iii) and Section 114AA of the Customs Act - allegation of abetting the fraudulent export of goods - availment of undue export incentives drawback/ DEPB/ focus products scheme, etc. - export of various goods by inflating value - HELD THAT:- The appellant as an employee carried out the instructions and directions of his employer. Further, the appellant had not filed any documents before the Customs Department. Thus, the allegation of attempt to export goods improperly is not established. Accordingly, we set aside the penalty imposed under Section 114(iii) of the Act.
Penalty under Section 114AA of Customs Act - HELD THAT:- The allegation of aiding and abetting is not proved. However, it is found that the appellant have knowingly made documents like invoices and packing list for export and had further knowledge that two sets of parallel invoices are prepared one for the purpose of buyer in the foreign country for receiving the export proceeds, and the other invoice having inflated value for receiving the duty drawback benefits. Accordingly, the appellant is liable for penalty under section 114AA - Further, as the appellant have acted only in his capacity as an employee and has not made any extra gain over salary of ₹ 15,000/- p.m., the penalty reduced to ₹ 1,12,500/- (being the amount already paid by way of pre-deposit).
Appeal allowed in part.
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2020 (9) TMI 604 - CESTAT BANGALORE
Levy of personal penalty for abetment - Quantum of Penalty - Section 114 of the Customs Act - Smuggling - illegal export - red sanders wood logs - HELD THAT:- The appellant Sachin Kumar was a transport agent who arranged the truck for the exporter and appellant No. (2) Venugopal acted as a CHA for clearance of the goods at the NMPT, Mangalore and appellant No. (3) Ravichandra arranged the CHA and the container. Further, the goods were stuffed at the KSDL factory, Bangalore in the presence of Mr. Hashim, Director of the exporter company and Superintendent of Central Excise and thereafter it was sent to Mangalore and from Mangalore it was exported.
During the investigation DRI recorded the statement of Mr. Hashim, Director of exporter company and also the appellants. In the statement of Mr. Hashim, he has clearly stated that he was responsible for smuggling of red sander wood logs and the appellants were not knowing about their smuggling plan - further, both the authorities in their orders have admitted that there is no direct proof of the complicity of the appellants and there is suspicion against each of the appellant and on the basis of that suspicion, the appellants have been imposed penalties.
It is pertinent to note that the Tribunal in various decisions consistently held that for imposing the personal penalty under Section 114(i) of the Customs Act, 1962, there should be acceptable legal evidence on record about the acts of commission or omission by the appellant. Further in order to hold that the appellant has abetted in the commission of the offence, there has to be a knowledge on the part of the appellant regarding the illegal activities of the exporter whereas in the present case no corroborative evidence has come on record which pinpoint that the appellant had the knowledge of the illegal activities of the exporter company.
The impugned order is not sustainable in law - penalty also set aside - appeal allowed - decided in favor of appellant.
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2020 (9) TMI 563 - KERALA HIGH COURT
Smuggling - Gold - allegation is that along with the other accused namely Shahbaz and Abdul Lais, the petitioner/3rd accused used ladies as carriers for smuggling gold through various Airports in India - retraction of statements - offence punishable under Section 135 of the Customs Act, 1962 - HELD THAT:- The Customs Officials are not Police Officers. The confession, though retracted, is an admission and binds on the petitioner.
Statement given under Section 108 of the Customs Act, which is inculpatory, is not hit by the provisions under Sections 25 and 26 of the Evidence Act. Whether the statements of the co-accused could be used against the petitioner is a question to be determined by the trial court. It is, therefore, premature for this Court to discard the materials against the petitioner in the form of statements under Section 108 of the Customs Act given by the other accused. This is not a fit case for invoking the jurisdiction of this Court under Section 482 Cr.P.C to quash the proceedings.
Petition dismissed.
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2020 (9) TMI 562 - BOMBAY HIGH COURT
Defreezing of Bank Accounts of petitioner (third party) - freezing of account on the ground of illegally availed Integrated Goods and Services Tax (IGST) refund of an exporter was deposited in the bank account of the petitioner - section 110(5) of the Customs Act, 1962 - HELD THAT:- Section 110(5) of the Customs Act, 1962 was inserted in the Customs Act by the Finance (No.2) Act, 2019 with effect from 01.08.2019 - Evidently, the action of freezing the bank account i.e., on 07.12.2018 was undertaken prior to insertion of the aforesaid provision w.e.f. 01.08.2019. Prima-facie this provision may not be applicable to the case of the petitioner. Additionally, as per the condition mentioned in sub-section (5) of section 110, the initial period of freezing the bank account i.e., not exceeding six months has expired long back. That apart, even if as per the proviso such period was extended by the Principal Commissioner of Customs or Commissioner of Customs for a further period not exceeding six months, that extended period has also elapsed. In such circumstances, continuing with the freezing of the bank account of the petitioner would be oppressive and without any sanction of law.
The respondents, more particularly respondent Nos.2 and 3, are directed to forthwith unfreeze the seized bank account of the petitioner - petition allowed.
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2020 (9) TMI 561 - CESTAT MUMBAI
Refund of Customs Duty - Liquefied Petroleum Gases for supply to household domestic consumers - Effect of Notification, prospective or retrospective? - N/N. 37/05-Cus dated 2.5.2005 was issued exempting Liquefied Petroleum Gases for supply to household domestic consumers at subsidized prices from whole of customs duty - period September, 2004 to April, 2005.
HELD THAT:- The undisputed facts are that the appellants had imported commercial butane (Liquefied Petroleum Gases) classifying it under Chapter heading 2711.1300 of Customs Tariff Act, 1975 on payment of applicable Basic Customs Duty (BCD) of 10%. Two amended notifications of the basic notification No. 21/02-Cus dated 1.3.2002 were in force during the period namely, Notification No. 82/04-Cus dated 18.8.2004 and 11/05- Cus dated 1.3.2005.
Under Notification No. 82/04-Cus dated 18.8.2004, Liquefied Petroleum Gases (LPG) falling under Chapter subheading 2711 1900 attracted concessional duty @ 5%, whereas the amending notification No. 11/05-Cus prescribed exemption to Liquefied Petroleum Gases for supply to household domestic customs falling under the same chapter heading 2711.1900. It is the contention of the appellant that after the issuance of first amending notification No. 82/04-Cus dated 18.8.2004, they have represented to the Government that oil marketing company did not import Liquefied Petroleum Gases as such, but commercial butane or propane of mixture of commercial butane and propane.
In the present case, in both amending exemption notifications No. 82/04-Cus and 11/05-Cus, concessional rate of duty + Nil rate of duty as the case may be the prescribed to be applicable only to Liquefied Petroleum Gases falling under Chapter 2811.1900. There was no mention of Chapter heading 2711.1300 as declared by the appellant while importing commercial butane (Liquefied Petroleum Gas). Applying the principles of strict interpretation, the exemption notification cannot be made applicable to the clearances of commercial butane (Liquefied Petroleum Gas) during the said period.
In the present case, we are concerned with the period prior to 2.5.2005 where under the notifications did not contain all the three chapter sub-headings like Entry No. 75E of Notification 37/2005Cus. dated 02.5.2005, both notifications 82/2004 Cus and 11/2005 Cus. mentioned the Chapter sub-heading 27111900 only and the description of goods as Liquefied Petroleum Gas only. Besides, the principle of interpretation of an exemption notification is now well settled by the Hon’ble Supreme Court in COMMISSIONER OF CUSTOMS (IMPORT) , MUMBAI VERSUS M/S. DILIP KUMAR AND COMPANY & ORS. [2018 (7) TMI 1826 - SUPREME COURT] - it needs to be construed strictly.
Appeal dismissed - decided against appellant.
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2020 (9) TMI 560 - CESTAT MUMBAI
Served Form India Scheme (SFIS) - Exemption of Customs duty under N/N. 92/2004-Cus. dated 10.09.2004 - Import of two golf carts with accessories - restricted goods or not - HELD THAT:- The department did not file any appeal against the order dated 26.12.2008 passed by the Commissioner (Appeals) in the first round of litigation. Since the department had not challenged the said order, the original authority as well as the appellate authority cannot go beyond the direction issued by the Commissioner (Appeals).
In the present case, DGFT has clarified by issuing various clarifications to the effect that golf carts do not come under the restricted category of vehicles, which is stated in para 3.6.4.5 of the Foreign Trade Policy - Further, the licensing authority, i.e. DGFT, has not taken any action against the appellant for wrongly availing the benefit under the SFIS nor did they take any steps against the appellant. Hence, the Customs authorities cannot refuse exemption to the appellant.
Appeal allowed - decided in favor of appellant.
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2020 (9) TMI 528 - MADRAS HIGH COURT
Duty Drawback - non-realisation of sale proceeds - Failure to approach the Reserve Bank of India for obtaining the necessary extension - Rule 16A of the Drawback Rules - HELD THAT:- The issue as to whether the extension is granted by the Reserve Bank of India or whether the petitioner is entitled for the relief otherwise, being factual issues, could be determined by the Revisional Authority himself, in line with the decision relied upon by the learned Standing Counsel for the respondents in ZAZ AND ZAZ PVT. LTD. VERSUS UNION OF INDIA AND 2 OTHERS [2014 (3) TMI 840 - ALLAHABAD HIGH COURT], wherein the Hon'ble Division Bench of the Allahabad High Court was also of the view that factual aspects requires to be verified by the Authorities and accordingly remanded back the matter.
The matter is remanded back to the third respondent herein. The petitioner is granted liberty to submit the remaining 6 Shipping Bills and all other certificates and materials in support of his claim - Petition allowed by way of remand.
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2020 (9) TMI 527 - CESTAT NEW DELHI
Valuation of imported goods - various kind of polyester knitted fabric of different weight and colour - rejection of declared value - enhancement of declared value - Commissioner (Appeals) allowed the appeal accepting the declared value - period 8 June, 2018 to 9 February, 2019 - HELD THAT:- The assessing officer have been making enhancement in a routine manner and the respondent who are regular importers are left with no choice but to sign on the dotted line for taking delivery of their goods to carry on their business, and also save the demurrage charges if the consignment is delayed in the port for want of clearance.
Appeal dismissed - decided against Revenue.
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2020 (9) TMI 526 - CESTAT NEW DELHI
Condonation of delay of 27 days from the date of limitation before commissioner (Appeals) - Delay was within condonable period of thirty days - sufficient cause which prevented the appellant from filing the appeal within limitation period - Benefit of exemption - certificate of origin - HELD THAT:- Commissioner (Appeals) have erred in dismissing the appeal on limitation, vide the impugned order dated 28.07.2020, which is in violation of the direction of the Hon’ble Supreme court in IN RE : COGNIZANCE FOR EXTENSION OF LIMITATION [2020 (5) TMI 418 - SC ORDER]. Accordingly, the present appeal is admitted for hearing on merits.
The rejection of certificate of origin is bad as it was a case of minor discrepancy and was fit to be ignored in terms of Rule 18 of the said rules. Further, the appellant had produced the rectified certificate of origin, which have been wrongly treated as issue of certificate retrospectively - the certificates of origin submitted by the appellant are in order.
The appellant is held entitled to the benefit of exemption/ concessional tariff under Notification No. 096/2008-Cus. - Appeal allowed - decided in favor of appellant.
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2020 (9) TMI 525 - CESTAT ALLAHABAD
Smuggling - Provisional release of seized goods - Betel Nuts and Black Pepper - prohibited goods or not - evidence with revenue to establish that the same were smuggled into the country or not - HELD THAT:- There are no evidence to establish that the goods which were moved within the country, were smuggled in the country and therefore, it was high handedness on the part of revenue to have detained the said goods not released the same inspite of the order of learned Commissioner (Appeals).
The appeal filed by Revenue is dismissed - Further, Revenue is directed to release Black Pepper and Betel Nuts to the respondents by 15 March, 2020.
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2020 (9) TMI 484 - CESTAT MUMBAI
Provisional release of seized goods - In-shell Walnuts imported under the DFIA Scheme - exemption under N/N. 98/2009-Cus dated 11.09.2009 - HELD THAT:- The imported In-shell walnuts are not liable for confiscation and the exemption claimed by the Appellant appears to be correct in view of the judgement of the Hon’ble Madhya Pradesh High Court in case of GLOBAL EXIM & ANOTHER VERSUS THE UNION OF INDIA & OTHERS [2018 (10) TMI 1485 - MADHYA PRADESH HIGH COURT] and the order of the co-ordinate Bench of this Tribunal in case of M/S UNI BOURNE FOOD INGREDIENTS LLP VERSUS COMMISSIONER OF CENTRAL EXCISE, HYDERABAD-II [2019 (3) TMI 1449 - CESTAT HYDERABAD]. It has been held in the said decided cases that In-shell Walnut is allowed to be imported against the DFIA issued for export of assorted confectionery and biscuits under SION E1 and E5 respectively as input items namely, Nut and Nut products, relevant food flavour, flavouring agent/flavour improvers, dietary fibre and fruit/cocoa powder.
The ratio of the judgment in the case of Global Exim was held to be inapplicable to the facts of the present case by the learned Commissioner of Customs on the ground that the said judgment delivered by the Hon'ble Madhya Pradesh High Court was accepted by the department and not appealed against on the monetary limit fixed by the CBEC - With regard to the precedential value of the decision of this Tribunal in the case of M/s Unibourne Food Ingredients LLP, the learned Commissioner of Customs has held that such order of the Tribunal has not been accepted and the department is in the process of filing an appeal before the Hon'ble High Court of Telangana.
Further, the technical opinion dated 08.08.2018 furnished by the Joint Director, JNCH Lab, opining that walnuts may be used of source of dietary fibres in the manufacture of Biscuits/Cookies and confectionery was not discussed by the learned Commissioner of Customs in the impugned communication dated 28.06.2019.
In order to meet the ends of justice, as an interim measure, the impugned communication directing the appellant for execution of Bond/Bank Guarantee and submission of undertaking for payment of the future adjudged dues should be stayed till final disposal of the case through proper adjudication process - Appeal allowed.
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2020 (9) TMI 483 - CESTAT MUMBAI
Confiscation - imposition of redemption fine and penalties - mis-declaration of imported goods - goods declared as Crystallised Glass Panel Grade B - test reports revealed that the goods were “Agglomerated Marble” and not “Crystallised Glass Panel Grade B”, as declared by the appellant - HELD THAT:- In this case, the facts are not in dispute that the appellant had filed the Bills of Entry, declaring the description of goods as 'Crystallised Glass Panel Grade B', whereas as per the test report obtained by the department, the same were reported to be 'Agglomerated Marble'; that the value in respect of both the category of goods were also different. Thus, there was misdeclaration in respect of both description and value of goods. Further, the subject goods were also imported in violation of the provisions of Foreign Trade Policy. All these aspects of statutory contravention were admitted and accepted by the Proprietor of the appellant-importer in the statement recorded under summon in terms of Section 108 ibid. Hence, under the facts and circumstances of the case, it is evident that the penal consequences provided under Sections 111, 125(1), 112(a)(i) and 114AA ibid are attracted for confiscation of imported goods, imposition of redemption fine and penalties.
It is found from the available records that though the importer-appellant had placed the purchase order for import of 'Crystallised Glass Panel, but the overseas supper had wrongly shipped different types of goods, the fact of which had also been acknowledged in the e-mail correspondence dated 09.12.2018. Further, the supplier had also expressed his willingness to take back the consignments as per the description provided in the Bills of Entry filed by the importer-appellant. However, it an admitted position that the importer-appellant did not take proper steps to check the cargo before presentation of the Bills of Entry for assessment purpose and accordingly, it cannot plead that the action on its part is entirely bonafide.
The quantum of redemption fine and penalty imposed on the importer appellant can be reduced to meet the ends of justice. Accordingly, while upholding the impugned order on merits of the case, we reduce the redemption fine from ₹ 1,18,85,000/- to 18,00,000 - penalty imposed under Section 112 of Customs, Act, 1962 reduced from ₹ 7,50,000 to ₹ 2,50,000.
Penalty under Section 114AA on Shri Sumeet Agarwal, proprietor of the importer-appellant - learned counsel argues that it is a settled principle of law that simultaneous penalties cannot be imposed on both - HELD THAT:- What we have before us is the imposition of penalty on the company under Section 112(a) and imposition of Penalty on the proprietor under section 114AA, ibid. The facts of the case and issue dealt are different. However, looking in to the facts and circumstances of the case, penalty imposed on Shri Sumit Agarwal reduced to ₹ 1,00,000.
Appeal allowed in part.
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2020 (9) TMI 482 - CESTAT MUMBAI
100% EOU - non-payment of Customs Duty - 100% cotton comber Noil - violation of conditions/provisions of Notification No. 52/2003-cus dated 31.3.2003 and conditions mentioned in their Letter of Permission (LOP) and the undertaking given by them in their B-17 Bond - Monetary limit involved in the appeal.
HELD THAT:- In the present set of 11 appeals, 8 appeals from Sr. No. 1 to 8 of the table mentioned in para 1 of this order, can be dismissed under the Litigation Policy as per Circular No. F. No. 390/Misc/163/2010-JC, dated 17.12.2015, which prescribes the monetary limit of ₹ 10 lakhs. In view of the Customs Notification cited above, first 8 Appeals in the table cited above are dismissed under the Litigation Policy without going into the merit of the case.
Further, after completion of the hearing, learned AR for the Revenue brought to our notice that the issue which is involved in the present case has been referred to the larger Bench in appeal No. C/85110/2013. He further prayed that the present appeals should be adjourned awaiting the decision of the Larger Bench in the case of M/S. EUROTEX INDUSTRIES & EXPORTS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLHAPUR [2020 (9) TMI 448 - CESTAT MUMBAI]. Since the issue involved in the present case has already been referred to the larger bench, therefore, we order that three appeals are adjourned and should be listed after the decision of the larger Bench.
Thus, 8 appeals namely, Appeal No. C/88586, 88590 and 88592 to 88597/2013 are dismissed under the Litigation Policy dated 17.12.2015 and 3 appeals namely, Appeal No. C/88598, 88599 & 88603/2013 are adjourned and to be listed after the decision of the larger Bench.
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2020 (9) TMI 479 - CESTAT MUMBAI
Valuation of import goods - marble blocks and slabs - undervaluation - allegation is that the appellant had presented undervalued invoices to the Customs for assessment of goods and that the amounts indicated in the undervalued invoices were remitted through banking channels and that portion of the value which was excluded from the invoices, was paid in cash or wire transfer - HELD THAT:- The learned adjudicating authority in the impugned order at paragraph 12 has held that even though the show cause notice has referred to the recovery of documents during the search operation, but the subsequent investigation did not throw any light on such documents and the entire case was made out only on the basis of 12 Bills of Entry. Further, it has also been noted in para 15 thereof, that the Note-Verbale, which formed the bedrock of the present proceedings, indicated only commencement of criminal proceedings against the indenting agents and that the Deputy Director, DRI was unable to provide information regarding the finality of the proceedings against such persons on the ground that the investigation was under the competency of the Public Prosecutor’s office of the Italian Republic at the Tribunal of Massa Carra. Furthermore, the learned adjudicating authority in para 16 thereof, has noted that in the present case, the modus operandi of undervaluation mentioned in the Note-Verbale was not followed – (a) intelligence regarding generic descriptions being used without revealing the actual variety of marble, did not stand scrutiny; (b) intelligence regarding price being in the range of 230-240 euros per tonne also did not stand and (c) the investigation did not produce any evidence of financial flowback through nonbanking channels in low tax countries.
The learned adjudicating authority in this case has accepted that the Note-Verbale only indicated commencement of criminal proceedings against the indenting agents in Italy and did not conclusively prove the guilt against such persons. In fact, as noted in the impugned order, even the Deputy Director of DRI had also expressed his inability to provide information regarding the final outcome of criminal proceedings against such persons. Since the investigations with regard to alleged fraud committed in exportation of goods in the originating country, has not attained finality, it cannot be hypothetically concluded that the appellant had indulged into the activities of undervaluing the goods - the present proceedings initiated against the appellant were premature and cannot be sustained. Further, in the statement recorded under summon, Shri K.M. Swamy, Director of the appellant had denied the fact regarding involvement of the intermediaries/indenting agents in purchases made by the appellants in respect of the disputed goods from the Italian suppliers. Furthermore, the investigations made by DRI did not produce any evidence of financial flow back through non-banking channels in low tax countries. Thus, under such circumstances, the charges of undervaluation cannot be leveled on the appellant.
The learned adjudicating authority has rejected the declared value in respect of the subject Bills of Entry under Section 14(1) ibid read with Rule 12 ibid and re-determined the assessable value under Section 14(1) ibid read with Rule 3(1) ibid, holding that sufficient evidence exists to show that actual invoice values were hidden from the Indian Customs authorities and manipulated invoices were presented for assessment purposes. We find that in support of such contentions, no credible evidences were produced by the department. Further, the procedures laid down under Rule 12 ibid have not been succinctly followed for rejection of the declared value - In this case, it is an admitted fact on record that the mandates of Rule 12ibid read with Rules 4 to 9 ibid have not been complied with by the department. Thus, rejection of declared value is contrary to the statutory provisions and accordingly, redetermination of the alleged transaction value cannot stand for judicial scrutiny.
There are no merits in the impugned order - appeal allowed - decided in favor of appellant.
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2020 (9) TMI 478 - CESTAT MUMBAI
Classification of export goods - ropes of various types made of PP and Polyester - MEIS Scheme - HELD THAT:- It is an admitted fact on record that in compliance of Section 50 ibid, the appellant had submitted all the requisite particulars/information for assessment and ascertainment of the duty liability, if any, in respect of the Shipping Bills, which were accepted by the proper officer of Customs and the appellant was permitted by an order under Section 51 ibid for clearance of the subject goods for exportation. In so far, an order of assessment is concerned, Section 129D ibid provides for passing of certain orders by the competent authority(s).
Sub-sections (2) and (3) of Section 129D of Customs Act - HELD THAT:- no appeals were filed by the Department against the assessment orders passed on the Shipping Bills before the Commissioner (Appeals) under Section 128 of the Act. Hence, the issue of classification and other facets concerning exportation of subject goods covered under the already assessed Shipping Bills was attained finality and any issues arising out of finalisation of such Shipping Bills cannot be questioned or agitated by the Department subsequently by initiating show cause proceedings against the exporter, the appellant herein.
In this case, the Department has initiated show cause proceedings and confirmed the adjudged duty demand under Section 28AAA of the Act on the appellant. The provisions contained therein for recovery of duties are applicable only in the eventuality, where an instrument issued to a person has been obtained by him by means of 'collusion'; or 'willful misstatement'; or 'suppression of facts'. We find that the learned Commissioner has dealt with such statutory provisions and their application to the facts of the present case at paragraph 10 in the impugned order. He has not particularly referred to any communication addressed by the office of Development Commissioner functioning under the DGFT to hold that the appellant got the MEIS scrip issued by the said authority by means of collusion, willful misstatement or suppression of facts. Further, there is no material evidence available on record to prove that the competent licensing authority under the Foreign Trade Policy had initiated any proceedings against the appellant alleging acquisition of the scrips in a fraudulent manner. The allegation with regard to MEIS benefits wrongly availed by the appellant does not have an independent nexus to the Customs Act, 1962 inasmuch as such scheme designed for the Merchant Exporter are dealt with under the Foreign Trade Policy (2015-2020) and Foreign Trade (Development & Regulation) Act, 1992.
The adjudicating authority has lost sight of the fact that the appellant's company is an artificial or non-human entity, cannot function or operate without involvement of the natural person i.e. the directors or the authorized persons. Therefore, we are of the considered view that the charges of guilt of 'collusion', 'wilful misstatement' or 'suppression of facts' cannot be levelled against the appellant, justifying invocation of the provisions of Section 28AAA of the Act - The impugned order in paragraph 12(ii) has confiscated the goods covered under Shipping Bill Nos. 7289261 and 7289281 both dated 12.07.2017 and imposed redemption fine on the appellant by relying upon the test report dated 02.11.2017 furnished by the DYCC/JNCH. The said report confirms that the Rope in question comprised of Polypropylene as the primary/major ingredient.
It is evident that the integral part and parcel of the principles of natural justice has been violated in this case inasmuch as reasons are the soul of any judicial order and good and proper reasoning make its body strong, which admittedly is absent in the present case. Accordingly, the matter should be remanded to the original authority for grant of opportunity to the appellant for cross examining the chemical examiner and thereafter to address the issue in a just and fair manner.
The impugned order is set aside, in so far as it has changed the classification of exported goods from CTH 56079090 to CTH 56074900, resulting in confirmation of duty demand along with interest and imposition of penalty on the appellant - As regards confiscation of goods and imposition of redemption fine, the impugned order is set aside and appeal is allowed by way of remand to the original authority for grant of permission to the appellant for cross examining the chemical examiner and thereafter to adjudicate the matter based on the outcome of such examination report.
Appeal disposed off.
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2020 (9) TMI 450 - BOMBAY HIGH COURT
Provisional release of car imported - only area of dispute is that according to the petitioner, the imported vehicle is a brand new one whereas according to the respondents, it is a second hand model - HELD THAT:- It is admitted that petitioner has paid the entire duty of ₹ 72,48,875.00 on the declared assessable value of the imported car of ₹ 33,71,569.00. It is also an admitted position that the vehicle is under seizure, seizure being made on 20.03.2020 though under detention since 11.01.2020 and that it has neither been confiscated nor adjudication has commenced.
Section 110 of the Act deals with seizure of goods, documents and things. Sub-section (1) says that if the proper officer has reason to believe that any goods are liable to confiscation under the Customs Act, he may seize such goods. While we are not called upon to adjudicate on the correctness of the decision to seize the imported vehicle in the present proceeding, what is relevant to note is that the condition precedent for seizure of any goods is that the proper officer must have reason to believe that such goods are liable to confiscation under the Customs Act. Confiscation is provided under section 111. Therefore, contention of the respondents that the vehicle was seized under section 111(d) is not correct. Seizure was made under section 110 perhaps on the belief that the vehicle is liable to confiscation under section 111(d).
As a matter of fact, section 110A provides a pragmatic mechanism to facilitate provisional release of seized goods etc. to the owner pending adjudication but at the same time protecting the interest of the revenue. Keeping the above in mind, the provision is required to be understood and applied.
This Court modified the order of provisional release by directing provisional release of the Ferrari F 430 car subject to petitioner executing a bond for full value and furnishing bank guarantee of any nationalized bank for ₹ 15 lakhs. Further condition imposed was that petitioner should not create any third party right, title or interest in the said imported car till adjudication proceedings reached finality - When the statute itself provides for provisional release of seized goods, merely on the ground that the good in question is a prohibited one or that the aggrieved person has filed appeal before the CESTAT cannot be the reason not to exercise the statutory discretion conferred by section 110-A.
Petition disposed off.
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2020 (9) TMI 449 - CESTAT NEW DELHI
Levy of Penalty u/s 112 (a) of the Customs Act on the employees of CHA - Absolute Confiscation - Smuggling - declared goods were 144 air conditioners as per the bill of entry, however, on inspection, it was found to contain 65 air conditioners, 940 cylinders of “Refrigerant 22” gas and 315 Sony Play Stations - prohibited goods or not - HELD THAT:- No case of aiding and abetting is made out against this appellant. This appellant as an employee of the CHA company was working as per the instructions given to him by his senior. There is no case made out of any abnormal gain by the appellant to indicate any collusion or abetment on his part with the importer of the consignment under dispute Shri Goyal and/or Shri Brijesh Mishra.
Penalty has been imposed mechanically without application of mind - Accordingly, the penalty imposed under Section 112 (a) of the Customs Act is set aside - appeal allowed - decided in favor of appellant.
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2020 (9) TMI 448 - CESTAT MUMBAI
100% EOU - clearance of cotton waste to domestic tariff area - Benefit of N/N. 1/95-CE dated 4th January 1995 and N/N. 22/03-CE dated 31st March 2003 pertaining to domestic procurement of raw materials and consumables - Benefit of N/N. 53/97-Cus dated 3rd June 1997 and no. 52/03-Cus dated 31st March 2003 - whether payment of excise duty at nil rate on clearance of cotton waste to domestic tariff area (DTA) in manner as prescribed by EXIM Policy, would be covered by the phrase “on payment of appropriate duty of excise” used in these exemption notifications, making appellants entitled to the benefit of these exemption notifications or otherwise?
HELD THAT:- Admittedly revenue had earlier issued a Circular in 1995 clarifying that “appropriate rate of duty” will include the “nil” rate of duty. Hence the view was that though Supreme Court had decided the issue, holding that “appropriate rate of duty” will not include the case of payment of duty at “nil” rate, but in view of Circular/ clarification issued, the interpretation made in circular will be binding on the revenue authorities. However this view was not concurred by the Hon’ble Supreme Court and in case of Kalyani Packaging [2004 (5) TMI 78 - SUPREME COURT], Hon’ble Supreme Court held that cases where benefits has been granted, cases should not be reopened. Otherwise Courts/Tribunals can not ignore a judgment of this Court and follow circulars of the Board - The decision of Kalyani Packaging was affirmed by the five member bench of Hon’ble Supreme Court in case of Rattan Wire and Melting [2008 (10) TMI 5 - SUPREME COURT].
Five Member bench of Hon’ble Supreme Court has in case Dilip Kumar & Co [2018 (7) TMI 1826 - SUPREME COURT ] settled the law in favour of strict interpretation of exemption notification and resolution of ambiguity in the interpretation of notification if any in favour of revenue.
Thus, we are not in position to agree with the decision rendered by the Mumbai Bench of CESTAT, in case of M/S. TECHNOCRAFT INDUSTRIES (I) LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, THANE I [2019 (8) TMI 719 - CESTAT MUMBAI], relied upon by the counsels for Appellant - In view of the decision of Hon’ble Apex Court in case of Sant Lal Gupta & Ors. [2010 (10) TMI 194 - SUPREME COURT] and Hon’ble Bombay High Court in case of Mercedes Benz India (P) Ltd. v. UOI, [2010 (3) TMI 300 - BOMBAY HIGH COURT] the matter needs to be referred to the President for constitution of a larger Bench for consideration of the issue.
The matter is referred to Learned President, for being placed before Larger Bench of Tribunal the following questions for consideration:
a. Whether the term “appropriate rate of duty” used in the exemption notifications 1/95-CE dated 4th January 1995 and no. 22/03-CE dated 31st March 2003 pertaining to domestic procurement of raw materials and consumables and notification no. 53/97-Cus dated 3rd June 1997 and no. 52/03-Cus dated 31st March 2003, will cover the case where the finished goods are cleared on payment of duty at nil rate?
b. Whether the CESTAT Mumbai in case of Technocraft Industries, was correct in holding that the benefit of these exemption notifications shall be admissible even when the finished goods are cleared on payment of duty at ‘nil’ rate?
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2020 (9) TMI 422 - GUJARAT HIGH COURT
Constitutional Validity of Section 25(4) of the Customs Act, 1962 as amended Finance Act, 2016 - Increase in duty on crude palm oil from 30% to 44% - Electronic publication of notification versus publication of notification in the official gazette - vires of Notification no.29 dated 1st March 2018.
Whether the petitioners would be liable to pay increased rate of duty as per the Notification issued under Section 25(1) of the Customs Act on the same day on which the bills of entry were field by the petitioner, but the notification was made available in official gazette in electronic form subsequently, in view of the provisions of Section 25(4) of the Customs Act as amended by the Finance Act, 2016? - Whether the provisions of Section 25(4) of the Customs Act, 1962 as amended by the Finance Act, 2016 is arbitrary, illegal, ultra vires and unconstitutional or not?
HELD THAT:- The above questions came for the consideration before the Andhra Pradesh High Court in M/S RUCHI SOYA INDUSTRIES LTD. VERSUS UNION OF INDIA [2019 (9) TMI 1374 - ANDHRA PRADESH HIGH COURT], the petitioner and the Andhra Pradesh High Court after considering the submissions canvassed by both the sides has held as under for striking down Section 25(4) of the Customs Act declaring as arbitrary and contrary to Section 25(1)(2A) of the Customs Act, 1962 - In view of above judgment and order of the Andhra Pradesh High Court dealing with the same issue, we are of the opinion that the same should also apply to the cause of action within the territorial jurisdiction of this Court also so as to maintain consistency for application of the provision of the Customs Act, 1962, which is a Central Act.
As held by the Supreme Court in case of KUSUM INGOTS & ALLOYS LTD. VERSUS UNION OF INDIA [2004 (4) TMI 342 - SUPREME COURT], the parliamentary legislation without receiving the consent of the President of India and published in a official gazette unless specifically excluded will apply to entire territory of India. If passing of the legislation gives rise to cause of action, the writ petition questioning the constitutionality thereof can be filed in any High Court of the country having requisite territorial jurisdiction and an order passed on writ petition questioning the constitutionality of Parliamentary Act, where interim or final keeping in view the provisions contained in clause (2) of Article 226 of the Constitution of India will effect throughout the territory of India, subject to applicability of the Act.
The provisions of Section 25(4) of the Customs Act, 1962 is declared as arbitrary and contrary to Section 25(1) & (2)(A) of the Customs Act, 1962. The respondents are therefore, directed to refund the excess amount of custom duty and differential amount of IGST collected from the petitioners for clearance of imported goods for home consumption as per the Notification published subsequently to the date of filing of bills of entry with simple interest @ 6% p.a. from the date of deposit till the date of payment - Petition allowed.
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2020 (9) TMI 421 - MADRAS HIGH COURT
Smuggling - import of plant khat - Narcotics drugs or not - only ground raised by the petitioner is that the alleged package was booked prior to the notification i.e., on 24.02.2018. Therefore, no offence can be tried as on the date of booking of the package and the substance was not banned in India - HELD THAT:- In the case on hand, the package was reached the shores of Mumbai on 03.03.2018 and thereafter it reached the Foreign Post Office, Meenambakkam, Chennai on 05.03.2018. Thereafter, on 12.03.2018, the parcel was examined and referred to Postal Appraisal Department. Thereafter only on 27.04.2018, in the presence of two independent witnesses, the officer in-charge taken the parcel for examination and found two pink polythene bags containing khat leaves weighing 7.9 kg, addressed to the petitioner herein. Therefore, the commission of the offence had taken place on 27.04.2018 as such, on the date of commission of offence, the contraband called khat leaves were included as psychotropic substances and the same was notified by the Government of India, Ministry of Finance vide notification No.S.O.821(E), dated 27.02.2018.
Reliance was placed in the case of CHIRAG HASMUKHRAI BHOJANI & 1 VERSUS STATE OF GUJARAT & 1 [2018 (5) TMI 2018 - GUJARAT HIGH COURT] where it was held that on the date of commission of the offence, the contraband called khat leaves were not included as psychotropic substances. It is notified only on 27.02.2018 and the khat leaves came to be included under NDPS Act after the notification - the above judgement is not applicable to the case on hand and on the date of commission of offence the contraband called khat leaves were very much included in the list of psychotropic substances under the NDPS Act, 1985.
Petition dismissed.
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