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Customs - Case Laws
Showing 21 to 40 of 38170 Records
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2024 (4) TMI 578
Jurisdiction - power to adjudicate SCN - Seeking direction to expeditiously adjudicate SCN u/s 124 of the Customs Act, 1962 - seeking provisional release of the seized goods u/s 110A of the Act - only argument raised by the petitioner is that the case of the petitioner is peculiar and as such an officer now below the rank of Commissioner of Customs should adjudicate the same.
HELD THAT:- The only factor to show peculiarity is that the petitioner was arrested at the Airport and the arrest was authorized by Commissioner of Customs. Further, it is contended that in the litigation that enured prior to the issuance of the Show Cause Notice, an affidavit was filed by Commissioner of Customs - there are no so-called facts as contended by the petitioner amount of any peculiar facts and circumstances warranting any transfer of jurisdiction.
Section 104 of the Act dealing with power of arrest, empowers Principal Commissioner of Customs or Commissioner of Customs, by a general or special order, to arrest any person whom he has reason to believe has committed an offence punishable under Section 132, 133, 135, 135A or Section 136 of the Act. Petitioner was alleged to have committed an offence under Section 132 and 135 and the arrest of the petitioner was done under the order of Commissioner of Customs.
Since the Commissioner of Customs was impleaded, in terms of the said Circular, it was the Commissioner of Customs, who was authorized to file an affidavit. Accordingly, mere fact that Commissioner of Customs has filed an affidavit would not denude an officer, otherwise empowered under the Act and the Rules and Notifications, to issue and adjudicate a Show Cause Notice even though the officer may be below the rank of the Commissioner of Customs - it is noticed that the case of the petitioner is far from peculiar/unique as there are several cases where arrests are made for infraction of the provisions under orders issued by Commissioner of Customs, which are challenged and proceedings initiated prior and post issuance of Show Cause Notices.
There are no peculiar facts and circumstances in the case of the petitioner to hold that an officer below the rank of Commissioner of Customs is denuded of the power or authority to adjudicate the Show Cause Notice - In the instant case subject Show Cause Notice issued on 31.03.2023 has been issued by a competent and authorized officer whose competence and authority is not under challenge by the petitioner.
There are no merit in the petition - The petition is consequently dismissed.
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2024 (4) TMI 577
Maintainability of petition - Chemical Examiner’s report is correct or not - Classification of imported goods - Technical Grade Urea - to be classified under tariff item 31021090 of the First Schedule to the Customs Tariff Act, 1975 or not - Petitioner seeks to command the respondents to forthwith complete all procedures and formalities and clear the goods imported by the Bill of Entry in Ext. P4 as Technical Grade Urea - HELD THAT:- Whether the petitioner’s product is Technical Grade Urea, or the Fertilizer Grade Urea is a question of fact which can be determined on the basis of the relevant parameters as determined by the Laboratory on examination of the samples drawn from the imported goods. This Court absolutely has no expertise to hold that the Chemical Examiner’s report is incorrect. This question has to be decided by the authorities themselves.
The writ petition is not maintainable and is dismissed.
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2024 (4) TMI 576
Seeking amendment of shipping bills - inadvertent error in the Shipping bills - seeking to credit ROSCTL benefit amounts to the petitioner’s Customs E-Scrip Ledger - HELD THAT:- The issue / question whether an inadvertent error in the Shipping bills by affixing ‘No’ instead of ‘Yes’ under the RoSCTL Scheme can be amended came up for consideration before the Madras High Court in PARAMOUNT TEXTILES MILLS PRIVATE LIMITED VERSUS THE DEPUTY DIRECTOR GENERAL OF FOREIGN TRADE, THE DGFT POLICY RELAXATION COMMITTEE, THE ASSISTANT COMMISSIONER OF CUSTOMS [2022 (4) TMI 1260 - MADRAS HIGH COURT] where the Madras High Court allowed the petition and granted the benefit of the RoSCTL Scheme in favour of the writ petitioner by permitting amendment of the Shipping bills.
In the instant case, the material on record discloses that except for the inadvertent error that had crept into the Shipping bills, wherein the petitioner had declared ‘N’ in the RoDTEP column instead of ‘Yes’, its intention to claim benefits under the RoSCTL Scheme is evident from the other material on record including the Shipping bills. Under these circumstances, in the light of the judgment of the Madras High Court in Paramount’s case, the petitioner would be entitled to amend the subject 28 Shipping bills and necessary directions are to be issued to the respondents in this regard by quashing the Communication at Annexure – N dated 24.11.2022 issued by the 1st respondent.
The concerned respondents are directed to permit / allow the petitioner to amend the 28 Shipping bills vide Annexure – H of the petitioner for the period from January 2021 to September 2021 and to grant the RoSCTL Scheme benefits to the petitioner and credit the said benefits to his Customs E-Scrip Ledger as expeditiously as possible - Petition allowed.
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2024 (4) TMI 575
Refund of Excess Customs Duty paid - principles of unjust enrichment - refund claimed transferred to consumer welfare fund alleging that the amount has been passed on to others and not borne by the appellant - HELD THAT:- The entire amount of duty and interest has been paid by the appellant after receiving certain amounts from M/s. Microsoft Corporation to meet the requirement of payment of duty. During the settlement proceedings, the Hon’ble Settlement Commission recorded the amount required to be paid and the amount deposited and also held that the excess amount, if any, be refunded to the assessee after adjusting the penalty amount. The authorities below transferred the refund amount to the Consumer Welfare Fund observing that the appellant has not borne the burden of the duty themselves but passed on to Microsoft Corporation; also the amount has not been shown as ‘receivable’ soon after payment of duty.
Reading the agreement in its entirety, it is found that after the proceedings were initiated against the appellant, they have received certain amounts from the overseas suppliers of M/s. Microsoft Corporation to meet the requirement of payment of duty and interest, who advanced certain amounts with a condition that the excess amount, if any, after adjusting the duty and interest be refunded to M/s. Microsoft Corporation. The appellant, thus, cannot retain the excess amount with them in accordance with the said agreement. Consequently, the refund amount cannot be retained by the Appellant but has to be repaid to M/s. Microsoft as per the said Agreement. Also, it is found that the appellant could not reflect the excess amount refundable in their books of accounts before the order of the Settlement Commission but could reflect only after the Settlement Commission has recorded a finding to this effect, quantifying the settlement amount.
There are no discrepancy of not showing the excess amount as receivables before the Settlement Commission’s order in their books of accounts which has been successively every year thereafter has been shown including for the financial year ending 31.3.2023.
The impugned order is set aside - appeal allowed.
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2024 (4) TMI 574
Levy of Anti-dumping duty - reflective glass during the period 04/01/2009 to 22/05/2009 - scope of N/N. 51/2009-Cus. dt. 22/05/2009 - HELD THAT:- During the intervening period i.e. 06.01.2009 to 22.05.2009, green reflective glass was not mentioned under the exclusion category of the N/N. 4/2009-Cus dt. 06/01/2009 but mentioned in the amending N/N. 51/2009-Cus. dt. 22/05/2009.
It is found that recently, Bangalore Bench of this Tribunal interpreting the said notifications in the light of the principle of law laid down by the Hon’ble Supreme Court in the case of Dilip Kumar and Company [2018 (7) TMI 1826 - SUPREME COURT] and in the case of State of Gujarat Vs. Arcelor Mittal Nippon Steel India Ltd. [2022 (1) TMI 1013 - SUPREME COURT], in the case of Glass House Vs. CC(Appeals) [2023 (11) TMI 915 - CESTAT BANGALORE], observed In the present case, since Reflective Glass is not found in the Notification No.4/2009-Cus. dated 06.01.2009 for exempting them from anti-dumping duty, question of extending the benefit does not arise. The Commissioner (Appeals) has rightly held that no attempt can be made to infer the motive or meaning of the Notification other than what is emanating from the plain language of the Notification. Therefore, we uphold the order of the Commissioner (Appeals) and dismiss the Appeal.
The impugned order upheld - appeal dismissed.
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2024 (4) TMI 541
Authority under the Customs Act to proceed against the property of a third party - Prohibition of Benami Property Transactions - petition under Article 226 of the Constitution assails a communication issued by respondent No. 2/Deputy Commissioner of Customs (Preventive), M&P Wing, Mumbai, to the Secretary, Pushpa Niketan Co-op. Housing Society informing the society not to permit the petitioner to transfer the flat owned by her without prior ‘No Objection’ (NOC) from the office of respondent No. 2. as respondent No. 2 had initiated certain investigation against the petitioner’s husband
Whether respondent No. 2 would have any authority under the Customs Act to proceed against the property of a third party namely of the wife of a person who is being investigated?
Whether de hors the Customs Act, there is any provision in law permitting respondent No. 2 to issue such communication?
HELD THAT:- Both the questions are required to be answered in the negative. We have not been pointed out any provision which can be resorted by the Customs officials to attach the property of a third party like the petitioner who cannot be connected to any recovery under the Customs Act, much less to issue the impugned communication. Even the provisions of Section 142 of the Customs Act which provides for recovery of sum due to Government could not have been resorted by respondent No. 2 to issue the impugned communication. Thus, respondent No. 2 has acted in patent lack of jurisdiction.
Even assuming that a statement is stated to be made by the petitioner's husband in relation to the flat in question being purchased by him or actually being his property and ostensibly owned by the petitioner, however, considering the clear provision of Section 3 of the Prohibition of Benami Property Transactions Act, 1988, respondent No. 2 cannot have any jurisdiction to question the petitioner’s ownership of the flat. The only person who can question the petitioner’s ownership, would be the husband of the petitioner.
Thus, in issuing communication of the nature as impugned, the respondent had, in fact, taken upon himself an obligation of concluding that the flat belongs to the husband of the petitioner, when in law such declaration can only be granted by a Civil Court. For such reason, even otherwise, respondent No. 2 would not have any jurisdiction to issue the impugned communication.
As respondent No. 2 did not wield any authority to issue the impugned communication. It was issued in patent lack of jurisdiction. The petition, accordingly, needs to succeed.
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2024 (4) TMI 540
Seeking provisional release of the goods - release of various models of second hand Highly Specialised Equipment digital Multifunction Print, Copying & Scanning Machines, imported by the petitioner - authorization for importing multi-functional device - HELD THAT:- Keeping in view of the foreign trade policy of the Government, the Order of 2012 which stood replaced by the Order of 2021 and subsequent amendments brought to Order 2021 by inserting clauses 6, 7 and 8, what is apparently evident is that in Order, 2012 the product multi-functional device was not a notified item. What was notified so far the writ petitions are concerned was only printers and plotters and the Order, 2012 was also preceded by a decision of the Government exempting highly specialized equipment from the coverage of Order, 2012. The Order, 2012 stood preceded by subsequent Order, 2021 which was issued and brought into force w.e.f 18.03.2021 and the schedule attached to Order, 2021 stood modified to the extent that in addition to printers and plotters the Government also notified multi-functional devices as an item so far as the foreign trade policy is concerned. This change in Order, 2021 so far as adding multi-functional devices in the schedule makes it amply clear that prior to Order, 2021 MFDs were not a notified item and since 18.03.2021 when the Order, 2021 was notified, MFDs became restricted goods under the foreign trade policy.
Though the learned Senior Standing Counsel for CBIC tried to give various interpretations to this clause, but on its plain reading, has its literal meaning and with the literal interpretation of the contents of clause 8, there does not seem to be any restrictions put by the Government so far as the classifications of highly specialized equipment is concerned. There also does not seem to be any mention of the said exemption not being applicable upon a second hand product as is envisaged under clause 2.31 of the foreign trade policy.
Thus, we are in agreement to the submissions made by the learned counsel for the petitioner so far as the import made by the petitioner of MFDs being a highly specialized equipment and the same being one which falls within the purview of an exempted category as per clause 8 of Order, 2021. Thus, we are of the considered opinion that it is a fit case where the petitioner can be permitted for provisional release of the goods seized by the respondent authorities.
Thus, it is ordered that let the respondent authorities pass an order on the application filed by the petitioners for provisional release of the goods subject to the conditions.
In addition, the petitioners are also directed to provide a bank guarantee worth 10 percent of the total price of the goods imported by them. Further, it is also ordered that in the event if the petitioners upon release of the goods provisionally make and sell the supply to their customers, details of the customers that of relevant price and details of the respective transactions shall be maintained and made available to the respondent authorities from time to time.
The present writ petitions accordingly stands allowed.
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2024 (4) TMI 485
Validity of Show Cause Notices issued for revision of the assessable value and customs duty - Undervaluation and Mis-declaration of the goods imported - bypass the normal Customs Channels and clear the imported goods into domestic area by resorting to gross undervaluation and thereby defrauding the government exchequer by evading the payment of higher customs duty - demand for differential Customs Duty - confiscation - reasons to believe - Penalty under the provisions of Section 112(a) & (b)/114A and 114AA - No independent inquiry / investigation with respect to goods imported - No opportunity of Personal Hearing - HELD THAT:- The SCNs i.e. SCN dated 09.02.2022 read with Corrigendum dated 11.02.2022 and SCN 14.02.2022 have been adjudicated by the Ld. Commissioner ex parte vide the impugned OIO MUN-CUSTOM- 000- COM-14-23-24 dated 20.09.2023 without affording any opportunity of Personal Hearing to the Appellant by applying the said value as proposed in the SCN dated 08.09.2021 i.e. the first S.C.N to the subject Bills of Entry and accordingly, have confirmed the entire demand along with interest and has also imposed penalty equal to the confirmed duty. In addition, penalty u/s 114AA has also been imposed.
It is further found that DRI has been stated to have developed an intelligence to the effect that one M/s Zip Zap Exim Pvt. Limited ("M/s ZZEPL"), a trading unit in Special Economic Zone, Kandla (Gujarat) ("KASEZ" ) was importing Knitted Polyester Fabrics and various other Electrical goods and subsequently, clearing the same into DTA to various DTA importers including the Appellant by resorting to gross undervaluation. On the basis of said purported intelligence, an investigation was conducted and after completion of the same, a show cause notice dated 08.09.2021 was issued to M/s ZZEPL & other DTA buyers including the Appellant proposing rejection of value declared by said SEZ Unit and demanding differential duty along with interest from DTA buyers (including the appellant) with respect to respective imported goods. Said show cause notice dated 08.09.2021 is yet to be adjudicated as per verification got done through Authorized Representative, which has revealed that matter was still to be adjudicated in that show cause notice.
However, the learned Adjudicating Authority, has adopted the value proposed to be re-determined in the said SCN and confirmed the demand accordingly. Thus, determination of value proposed in the SCN is done u/s 28 (8) by depending on a show cause notice which has yet to be adjudicated. This is erroneous as value proposed in SCN dated 08.09.2021 the first S.C.N cannot be made basis to raise and confirm the demand in the present case without adjudication. Thus, entire demand confirmed in the present case vide impugned show cause notices on the basis of alleged value proposed in another show cause notice dated 08.09.2021, is bad in law. It is nothing but putting the cart before the horse. Perhaps it is a fit case, where common adjudicating authority for two jurisdictions should have been appointed by the C.B.I.C. An allegation which is yet to be decided in a show cause notice cannot be made evidentiary basis to sustain demand in another.
A weak foundation of allegation alone in one matter cannot lead to strong edifice of sustainable evidence in another matter. “Debile fundamentum fallit opus” applies in the present case. An allegation which has not faced judicial scrutiny does not merit to be treated as authoritative evidence. We therefore, find that order cannot be sustained, same is set aside. Matter is remanded to be heard along with or after decision in show cause notice dated 08.09.2021 i.e. first S.C.N acquires sufficient evidentiary value and after due observance of natural justice in the impugned S.C.Ns and providing various relied upon materials to the appellant and after considering on submissions including made on the point of limitation vis-a-vis of corrigendum by the appellant.
Impugned order is set aside and appeals are allowed by way of remand in above terms. Appeals allowed by remand.
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2024 (4) TMI 484
Validity Of Order-in-Appeal - Seeking amendment in the bills of entry u/s 149 of the Customs Act, 1962 (CA ’62) - refund of excess duty paid - Re-classifying the goods by changing the CTH - Import of ‘Electronic Parts of Lighting Equipment’ - erroneously declared under a wrong CTH 85122010/20 - same parts were imported earlier under the correct CTH 85129000 - HELD THAT:- In the instant case the request for amending the CTH declared in the Bill of Entry would finally result in a refund. This would make it necessary to calculate the duties payable afresh. The redetermination of duty as a principle, would include determining the import permissibility of the revised CTH in terms of the EXIM policy and any other laws regulating imports/exports, determining duties now leviable on the goods on import – (Basic, Additional, Anti-dumping, Safeguards etc.). Permissibility of various benefits under different schemes or applicability of any exemption notification benefits etc. The goods may require the value to be re-fixed based on the Tariff Values fixed for the changed CTH or to be scrutinized for the basis of duty calculation changing from specific duty to ad-valorem duty etc. Its only after this process is complete that the duty liability, which is required to be paid by the importer as per the revised CTH can be determined and the refund claim examined along with unjust enrichment etc.
Hence the administrative action of amending the CTH in the BE would virtually amount to an order of reassessment by the same proper officer after the original assessment done had concluded the determination of the liability of the importer to pay duty and the goods have been cleared from Customs controls. Once assessment is concluded it should not be administratively tinkered with either at the behest of the importer or of the department, without it being challenged in appeal.
It is also to be mentioned that although rectification of mistakes or clerical errors are permissible u/s 154 of the Customs Act, the Appellant has not used that provision to alter / rectify the BE. Hence the Appellant himself acknowledges that the change sought to be made in the BE is not merely an error or mistake. Rightly so as the amendment request is not for only one Bill of Entry but for Bills of Entry filed over a period of time. Even a bonafide error made over a period of time would be in the nature of negligence which in common parlance means and implies a failure to exercise due care, expected of a reasonable prudent person.
If the goods are not available for verification or examination or testing as embodied in Section 17(4), the reassessment cannot be permitted.
However, once a decision is taken by the proper officer to verify / examine or test goods, then, as per the rule of prudence in law, appellate power is not to be exercised by an Authority for the purpose of substituting one’s subjective satisfaction with another, without there being any specific reason for such substitution.
There are 3 methods provided in the Customs Act, for any modification or amendment to be made in any Bill of Entry. Hence an amendment application u/s 149 of Customs Act, 1962 can be filed to revise the classification in the Bill of Entry.
We find that the present issue arises with an aim of the Appellant getting a refund of excess duty perceived to have been paid. From the inception of the Customs Act the “assessment” of imported goods was done by the ‘proper officer’.
It is the Appellants contention that the Apex Court in ITC Ltd [2019 (9) TMI 802 - SUPREME COURT], has categorically observed that self-assessment could be modified either u/s 128 or under relevant provisions of the Act. According to them on a plain reading of the provisions of Section 149, it is clear that a Bill of Entry can be authorised to be amended even after the imported goods have been cleared for home consumption on the basis of documentary evidence that was in existence at the time the goods were cleared. The Appellant’s claim to amend a document under the said section is not disputed. The question is whether an amendment facility permitted u/s 49 is among the ‘relevant provisions of the Act’ that empowers and can be used as the route to review and undo the assessment already made, which assessment order as per the Hon’ble Supreme Court’s judgment in Flock India [2000 (8) TMI 88 - SUPREME COURT], ‘is in the nature of execution of a decree/order’.
From the discussions above regarding the impact of a change of CTH declared in the Bill of Entry on the assessment already made, it appear that as per the Hon’ble Supreme Court’s judgement discussed above the request for change in CTH and consequently of a final assessment could only be made before a superior authority in appeal.
In the light of the ratio of the judgments of the Hon’ble Madras High Court in the case of Stanley Engineered Fastening India Pvt Ltd v. CC [2023 (3) TMI 846 - MADRAS HIGH COURT] and Bharti Airtel v. UOI [2022 (2) TMI 154 - MADRAS HIGH COURT], the impugned order is set aside and the matter is remanded to the proper officer. He is directed to process the request of the appellant dated 13.9.2019 for amendment of the BE’s as per section 149 of CA ’62. On being satisfied he should re-assess the impugned goods to duty by passing a speaking order. After the re-assessment order is issued the appellant will be eligible to claim consequential refund, if any, as per law. The lower authority shall follow the principles of natural justice and afford a reasonable opportunity to the appellant to state their case both orally and in writing if they so wish, before finalizing the matter. The appellant should also co-operate with the adjudicating authority in completing the process expeditiously and in any case within ninety days of receipt of this order.
The appeal is disposed of accordingly.
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2024 (4) TMI 483
Jurisdiction of this Tribunal to entertain appeal - Jurisdiction u/s 129A of Customs Act, the proviso (a) to sub-clause 1 - Confiscation of goods - Indian currency/Goods - Baggage Rules - HELD THAT:- It is clear that the appellant was traveling back from Bali to India, however, had forgot his hand bag at Bali Airport along with INR 4,34,000/- therein. It is apparent that the Indian Currency of INR 4,34,000/- was handed over in India by the airlines staff to the appellant on 09.07.2019 in presence of the customs authorities. Since, the Currency was in excess of the permissible limit of Rs. 25,000/- per person as provided under FEMA vide Notification dated 29.12.2015, that amount over and above Rs. 25,000/- i.e. Rs. 4,09,000/- (INR) was proposed to be confiscated under Section 111 read with Section 113 of the Customs Act with the proposal of imposing penalty on the appellant under Section 112 (a) and 112 (b) (i) and 114AA of Customs Act, 1962.
The appellant had kept currency in his baggage which he was supposed to bring into India but forgot the baggage having Indian currency/Goods in said ‘Baggage’ at Bali airport. The said Baggage when was brought to India and was inspected it was found carrying INR of value more than permissible one. The order confiscating the same has been passed specifically under Section 111 (L), considering the recovered currency being beyond permissible limit (Prohibited) as ‘Goods’ imported in ‘Baggage’ without a declaration required under Section 77 of Customs Act.
The very perusal shows that the context of confiscation of Indian Currency in the present appeal, is one recovered from Baggage which the appellant has failed to declare under Section 77 of the Act. The penalty has also been imposed under Section 111D and 113D due to import being contrary to the prohibition imposed under FEMA is sufficient to hold that the context of the present appeal is ‘Baggage’. In terms of Section 129A, sub-clause (a) of the proviso therein, the appeal in such case has to be filed before the Revisional Authority and is not maintainable before this Tribunal.
The decision of Calcutta High Court in Vinod Kumar Shaw 2010 (12) TMI 1335 - CALCUTTA HIGH COURT] case is observed to not to be applicable to the given set of circumstances. The said decision has categorically held that question of jurisdiction is relatable to the question of fact. When the case proceeds on the basis of Baggage it has to be understood whether the subject matter is Baggage or not. The subject matter before Calcutta High court was held to be Indian currency simpliciter whereas in the present case the subject matter is the confiscation of Indian currency not only under Section 111D also under Section 111 (L) but that too beyond permissible limit currency being imported/exported in ‘Baggage’.
Thus, present is the appeal against an order which has been passed with respect to Currency i.e. goods improperly exported and improperly imported as Baggage. Hence, this Tribunal is held to have no jurisdiction to try the impugned appeal - appeal disposed off.
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2024 (4) TMI 482
Failure to re-export the goods after re-import - Benefit of exemption from customs duty - Change of Notification in the bill of entry - Recovery of Drawback - Exports leather shoes - goods returned for repair of the shoes - failed to comply with the condition of re-exporting the goods - Whether the appellant is eligible for the benefit of Notification No.94/96 although they have not claimed the said benefit at the time of import of goods - HELD THAT:- From the facts, it can be seen that that the appellant had intended to re-export the goods after repair of the shoes. However, they could not fulfil this requirement and thereafter sold the goods locally. They then requested the department to extend to them the benefit of Notification No.94/96. The department has not considered the same observing that the appellant has availed drawback and claimed benefit of Notification No.158/95 at the time of import of the goods.
On similar set of facts, the Tribunal in the case of Olam Agro India Ltd.[2024 (2) TMI 317 - CESTAT AHMEDABAD] had considered the very same issue and held that the appellant would be eligible for alternate beneficial notification. The decision of the Hon’ble Supreme Court in the case of Share Medical Care [2007 (2) TMI 2 - SUPREME COURT] held that assessee cannot be denied the benefit of alternate notification when it is eligible at the time of import of the goods. Following the cited decisions (supra), we are of the view that the appellant is eligible for the benefit of Notification No.94/96. However, it is made clear that the appellant has to pay back the drawback claimed by them along with interest.
The impugned order is set aside. Appeal is allowed with consequential relief, if any, on the condition that appellant has to pay back drawback claimed.
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2024 (4) TMI 481
Classification - Imported goods from Korea - "gold coins (other than legal tenders)" - fall under CTH 7114 1910 as claimed by the appellant Or under CTH 7118 9000 as claimed by the department - exemption from payment of Customs duty - rejection of exemption under notification dated 31.12.2009, as amended by notification dated 31.12.2016 - recovery of differential duty with interest - Whether the imported gold coins can be called as the ‘Prohibited Goods’ merely for want of letter issued by Reserve Bank of India - HELD THAT:- The goods in question apparently and admittedly are gold coins. As the terms suggest these are the articles crafted out of precious metal hence appears to be subject matter of CTH 7114. Simultaneously these articles specifically are coins and coins are precisely mentioned under CTH 7118. Thus it becomes the point of interpretation as to which CTH entry suits the impugned goods more. Hon’ble Apex Court in the case of Commissioner of Central Excise, Shillong vs. Wood Craft Products Ltd.[1995 (3) TMI 93 - SUPREME COURT] and also in a later decision in the case of L.M.L Ltd. vs. Commissioner of Customs [2010 (9) TMI 12 - SUPREME COURT] has held that for resolving any dispute relating to tariff classification, a safe guide is the internationally accepted nomenclature emerging from HSN.
Entry at CTH 7114 covers all articles of Gold. The word article has also not been defined under any of the Notes to Chapter 71. Again the dictionary meaning has to be relied upon. As per Oxford Dictionary article is a particular item or object and include household articles. Cambridge Dictionary also define article to mean as an object, a particular thing specially one i.e. one of several things of a similar type or a thing similarly placed. As per Merriam Webster dictionary article is a thing or a person of a particular and distinctive kind of class. Thus, it becomes clear that goods in question, (gold coins) being an object/ a thing of particular kind, hence are nothing but the articles.
Keeping in view the entire discussion about Chapter Notes, explanatory notes, the General Rules of Interpretation and the description of respective entries under CTH 7114 and 7118, it becomes clear that gold coins are such articles of gold which are in the form of coin, but being the coins of non legal tender, these cannot be covered under CTH 7018. These being articles of precious metals are therefore held to be covered under CTH 7114.
This issue is otherwise no more res-integra as has been decided by this Tribunal’s Principle Bench in the case of Abans Jewels Pvt. Ltd. vs. Principal Commissioner of Customs, ACC (Import) [2022 (4) TMI 1370 - CESTAT NEW DELHI] and also by the Regional Bench of Hyderabad as well as of Bangalore in the case of Sri Exports [2019 (5) TMI 82 - CESTAT BANGALORE]. Accordingly, the above formulated question No. 1 stands decided in favour of the importer and against the Department.
As far as goods imported and classified under CTH 7114 1910 are concerned, in terms of the Schedule I of the ITC (HS), the same were freely importable without any restrictions prior to the issuance of the Notification No. 25/2017 dated 25.08.2017. Vide the said Import Policy, the Articles of gold were allowed to be imported free whereas coins of any metal other than gold, though were freely importable but were subject to RBI regulations. Thus Import Policy of 2017 clarifies that since the goods in question were though coins but of gold, no prohibition is at all applicable upon these coins which were merely articles of gold.
Both these documents are sufficient to hold that gold coins in question were not restricted. Only such coins as are classified under CTH 7118 were restricted. As already held above that impugned gold coins are classified under CTH 7114 the RBI can issue regulations u/s 58 of the Reserve Bank of India Act, 1934 or section 47 of the foreign Exchange Management Act, 1999.
The exemption as availed by the appellant under Notification No. 152/2009-Customs dated 31.12.2009 as amended by Notification No. 66/2016 Cus. dated 31.12.2016, is held to be very much available to the appellant. We are of the opinion that Commissioner (Appeals) has wrongly relied upon the decision of Hon’ble High Court of Delhi in the case of Khandwala Enterprises Pvt. Ltd. vs. Union of India [2019 (11) TMI 740 - DELHI HIGH COURT].
Accordingly we hold that Adjudicating Authority below has wrongly interpreted the said decision. In-fact has wrongly applied the same to the facts of the present case despite that the facts are not identical. Thus both these questions (No. 2 & 3) also stands decided in favour of appellant holding that the gold coins imported by appellant are not the restricted goods and that the appellant is entitled for the exemption from payment of customs duty in terms of Notification No.66/2016-Cus dated 31.12.2016.
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2024 (4) TMI 446
Refund of IGST on Export of Goods - Conditions were complied with post-export - Amendment of Bills of Entry for imported goods under the Advanced Authorisation Scheme and the Export-Oriented Unit (EOU) Scheme - A significant bone of contention was whether Bills of Entry could be amended post-clearance to reflect IGST payments - HELD THAT:- The Central Board of Indirect Taxes and Customs (CBIC), relying on the difficulty faced by the importers in amending the Bill of Entry despite payment of IGST and compensation cess, had issued notification Circular No.16/2023 and provided a separate procedure for amending the Bill of Entry inspite of second proviso to section 149.
The office of Principal Commissioner of Customs, Maharashtra had issued public notice dated 23rd February 2024 for amending the Bills of Entry as per the procedure prescribed in different scenarios mentioned in the said public notice. In view of the notification No.78/2017-Customs dated 13th October 2017 and the public notice, the stand of the respondents that the Bills of entry cannot be allowed to be amended as the petitioners have not paid the IGST at the time of clearance of the imported goods and as a Bill of entry can be amended only on the basis of the documents available at the time of clearance of the goods, does not hold a valid ground for rejecting amendment of the Bill of Entry. Rejecting the application for amendment of the Bills of Entry despite payment of IGST and interest except in Writ Petition No.4670 of 2024 where the interest has not been paid cannot be countenanced.
Further, as noted, except for the petitioner in Writ Petition, the Commissioner of Customs vide order dated 4th March 2022 directed the petitioners to deposit the IGST along with interest for all the Bills of Entry for which erroneous refund was availed under Rule 96(10) of the CGST Rules, 2017 and submitted the report after making payments. Out of the 12 entities who were directed to remit the amount of IGST along with interest, in the case of two entities, the Bills of Entry have been amended. However in the case of the petitioners, amendment to the Bills of Entry have been refused. There is no explanation coming forth from the respondents for choosing a few to allow them to amend the bills of entries and denying the same relief to others.
Therefore, the petitions are to succeed, and thus, allowed. Respondents are directed to amend the bills of Entry of the petitioners. The petitioner in the Writ Petition is directed to pay the interest, if already not paid, within a period of 15 days from today and on the payment of interest and verification of the documents of payment of IGST and interest, the Bills of Entry should also be amended. Thus, the Writ Petitions stand allowed.
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2024 (4) TMI 445
Exemption under Sl. No. 303 of Notification No.12/2012-CE dated 17.03.2012 - import of flight simulators and avionics for M/s. Hindustan Aeronautics Limited (HAL), Bangalore and others - It is alleged that the appellant had wrongly claimed the benefit of the Notification claiming them as parts that are intended for servicing, repair or maintenance of aircrafts, thus evading duty of Countervailing Duty (CVD), Special Additional Duty (SAD) and Education cess.
HELD THAT:- The benefit of the Notification is available only for the parts of the aircraft which are intended for servicing, repair or maintenance of the aircraft. The question to be decided is whether the imported ‘prototype’ form part of the aircraft and whether they are intended for the said purpose mentioned in the Notification. The appellant themselves vide their letter dated 07.01.2013 have stated that the first prototype (engineering unit) imported by them is identical in terms of its functions and applications when compared to the other 2 prototypes imported by them but the only difference between the first unit and the other units is that the first unit is tested on the ground in the designers’ lab to verify that all functionalities, weight and power consumption, as required by the customers are incorporated - Admittedly, the first prototype unit imported by the appellant is only for testing the worthiness of the aircraft for the required upgradation and does not form part of the aircraft. Therefore, the Commissioner was right in disallowing the benefit of the Notification since admittedly; it does not form part of the aircraft.
With regard to the other two imports, the technical write-up states that it is meant for upgrading the Engine and Flight Instrument System (EFIS) for DARIN III upgrade programme for Jaguar Aircraft. The set equipment is meant for replacement of the conventional Electro-mechanical instruments/sensors of DARIN Jaguar aircraft. The Commissioner in the impugned order states that the appellant has declared them as ‘prototypes’ while the first one is not fitted to the aircraft and the other 2 are claimed to have been fitted for upgradation of the aircraft. This plea is rejected on the ground that “the notice themselves refer to the goods in all the 3 imports as prototypes. As indicated earlier, prototypes by definition and by general understanding are for testing and evaluation and not for commercial use.
Whether these imports which are intended for replacement/upgradation of the aircraft are eligible for the benefit of the Notification which is intended for servicing, maintenance or repair? - HELD THAT:- Since the benefit is being extended to the parts of aircrafts owned by Government of India, these terms must be understood in terms of their usage and practice. Therefore, in order to understand its true meaning under the said Notification, reference must be made to the Aircraft Rules, 1937 - contention of the Revenue is that these goods are meant for replacement and upgradation, which cannot be considered as an activity of servicing, repairing or maintenance and therefore, the appellant is not eligible for the benefit of the Notification No. 12/2012-Cus., dated 17-3-2012, is devoid of merit.
The ‘Flight Clearance Certificate for Engine’ dated 30.05.2013 issued by the Ministry of Defence states that “the EFIS replaces the engine fuel hydraulic pressure standby flight instruments in the jaguar cockpit. These electro mechanical instruments are replaced with LCD display of EFIS. The EFIS system provides engine parameters, fuel parameters, hydraulic parameters and flight parameters.” This establishes the fact that it forms the part of the aircraft - the benefit of the Notification is denied to the first prototype cleared vide Bill of Entry No.7362578 dated 11.07.2012 and the benefit of the Notification to the other two imports which are meant for upgradation of the aircraft is allowed.
Appeal allowed in part.
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2024 (4) TMI 444
Smuggling - Gold of foreign origin - Absolute Confiscation - town seizure - reliability of statements/retraction of statements - cross-examination of witnesses - recording of statements in gross violation of order given by the Apex Court in the case of Shafhi Mohammad vs The State of Himachal Pradesh [2018 (4) TMI 1830 - SUPREME COURT] - onus to prove u/s 123 of CA - HELD THAT:- It is found that the owner of the gold in question Mr. TPK, at the very initial stage of being questioned by Revenue, has stated that the gold is out of stock in trade. Further, he has lead evidence that as per his stock register, he was having 6303.804 gms of gold. Thus, issue of 1431.61 gms of gold, after adjusting the sales made till 23.08.2020 on the date on which gold in question was sent for conversion into ornaments through his employee – Mr. CNR, stands fully explained.
The Adjudicating Authority has made an attempt to compare the stock position as on 30.09.2020 which is not at all relevant and is wholly mis-conceived. In case of ascertaining stock position the relevant date is the date on which availability is claimed, which is fully satisfied in the facts of the present case. It is further found that the appellant has also shown and accounted for the seizure of 1431.61 gms of gold by the DRI, in his books of accounts, which is also reflected in their balance sheet.
It is further found that both Mr. CNR and Smt. Padma Priya. V, of M/s JRV Jewellers have retracted their statements in reply to SCN. Further, it is found that these persons, in spite of the retraction being in the knowledge of Revenue, were not examined by the Adjudicating Authority in the adjudication proceedings. Thus the retraction goes un-rebutted. Further, it was the onus of the Revenue to establish that the statements were given voluntarily without any pressure or duress, as held by the Hon’ble Supreme Court in the case of Vinod Solanki [2008 (12) TMI 31 - SUPREME COURT]. It is an admitted fact that the seizure is by way of town seizure and further there were no markings on the gold bar/pieces indicating foreign origin. Further, it is evident from the report of the valuer that the bars are of irregular shape and size being of the weights – 538.980 gms/842.550 gms/43.6 gms/6.480 gms. Thus, the shape and weight of the bars also speak for itself that these are not of any foreign origin as it is known in the trade circle that gold of foreign origin is of standard weight and shape of 100 gm/1 kg and also has the marking of the refiner with the unique serial number.
The appellants have submitted various documents in support of their contention as regards source of gold being extract of their books of accounts and registers, financial statements like balance sheet and profit and loss account, copy of GST returns, copy of challan issued for sending gold to Coimbatore through Mr. CNR. Such documents have not been found to be untrue. Accordingly, the appellants have discharged the onus under section 123 of the Customs Act - the entire proceedings are vitiated as SCN has been issued after more than 6 months from the date of seizure.
The appellant – Mr. T. Pavan Kumar shall be entitled to release of 1431.61 gms of 24 ct gold and if the same has already been sold, shall be entitled to the sale proceeds with interest, as per Rules - the impugned order set aside - appeal allowed.
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2024 (4) TMI 443
Interest on delayed refund - Interest for the delay in payment of additional duty - calculation of relevant time - HELD THAT:- As per Section 18(4) of the Customs Act, 1962, it is clear that on finalization of assessment of duty, assessee is entitled for refund and if refund is not made within 3 months from the date of such assessment, assessee is entitled for interest on such amount as per the rate fixed by Central Government under Section 27A of the Customs Act, 1962, till the date of refund of such amount.
The ratio of the judgement relied by the appellant the matter of M/S GKN DRIVE LINE (INDIA) LTD. VERSUS COMMISSIONER OF CUSTOMS, NEW DELHI [2013 (8) TMI 355 - CESTAT NEW DELHI], right to interest under Section 18(4) of Customs Act, 1962 is applicable if the due amount is not paid within 3 months from the date of final assessment and not to reckoned 3 months after submission of refund claim as per section 27 of the Customs Act, 1962. Only for the rate of interest, rate fixed by Central Government under Section 27A will apply.
Considering the fact that adjudication/appellate authority has not considered the provisions of Sections 18(4) of Customs Act, 1962 in appellant’s case, the appeal is remanded to adjudication authority to consider the plea of the appellant regarding their entitlement of interest under Section 18(4) of the Customs Act, 1962. The Adjudication Authority directed to consider and pass appropriate orders within 4 months after the receipt of the final order.
Appeal is allowed by way of remand.
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2024 (4) TMI 385
Confiscation of goods - recovery of Customs duty - imposition of penalties - Clandestine removal of bunkers - import of duty free Furnace Oil & HSD Fuel Oil under warehouse procedure and same was illegally supplied under the guise of Export to Stores on Foreign Going Vessel - case of the revenue is that although the goods were taken out of charge Ex-Bond successfully yet the same was not supplied to any Foreign Going Vessel and diverted elsewhere - HELD THAT:- It is found that revenue during the investigation Bunker Supply documents consisting of the photocopies of Shipping Bills, Short Shipment Notices, Sale contract and Warehousing Bonds/ undertaking etc. were called and recovered from the Appellants. Besides the documents like Shipping Bills, related to bunker supplies and EGM of the recipient vessels were also called for from the Customs Houses of the Ports of Supply where the supplies were shown having been made to the vessels by the Appellants. The documents like Log Book (LB) and the Oil Records Books of Bunker Barges shown having used in the transportation were also called for from the Barge owners/ Operators and details of all bunkers supplies made through barge Zee-II were called for from M/s Zee Shipping Services and others.
It is found that the Shipping Bills filed at the Ports, wherein the Consignee is shown as the Master of the Foreign Going Vessels to whom the supply is to be made, were duly assessed by the proper officers of Customs at Kandla, Mundra and others ports where the Bonded tanks is located. This is evident from the fact that on Shipping Bills, bear the signatures of the Customs Officers, who assessed the Shipping Bills. Documentary evidences like acknowledgment by the Master of the vessel, acknowledgment by the Customs officers who escorted bunkers and supervised delivery to the Ships etc. produced by the Appellants clearly established that Bunkers covered under each of the Shipping Bills were supplied to the Foreign going vessels - Customs officers whose statements were recorded by the investigating officers have also confirmed the fact of the concerned bunkers having been supplied to foreign going vessels under their supervision and they have singed/counter singed/endorsed the documents.
It is found that if bunkers were diverted i.e they were not supplied to the forging going vessels then it was a case of clandestine removal of bunkers which had to be proved by the department by adducing cogent and reliable evidences for establishing actual clandestine removal and delivery of such disputed bunkers to other persons. But there is no such case nor any evidence by the department for actual diversion of the bunkers were produced on records. We agree with the arguments of the appellant that diversion of duty free goods in clandestine manner being a serious charge which has to be proved by the department by adducing cogent and reliable evidence of independent nature. The case made out by Revenue cannot be sustained in the absence of evidence showing diversion of the duty free imported goods to other persons or in the local markets.
In the present matter the demand is confirmed by the Ld. Adjudicating authorities in respect of the Shipping Bills on the ground that the EGM”s filed by the vessels do not reflect the receipts of the Bunkers as supplied by the Appellants by virtue of the said Shipping Bills. In this regard we find that EGM is a document that is prepared by the Master of the Vessel or the Shipping agent and filed with the proper officers at the time of departure or within 7 days from the date of departure. However on this basis only duty liability cannot be confirmed against the Appellant. In the present disputed matter we find that in respect of the all the shipping bills appellants have duly recovered the consideration for the bunker supplied to recipient vessels. Despite the EGM not mentioning the receipt of bunkers, the owner of the recipient vessels has duly made payment for the said bunkers - the goods involved in all cases were examined and cleared for “Foreign Going Vessel” in terms of the Section 88 read with Section 69 of the Customs Act 1962. Goods were loaded on the vessel and the concerned officers who examined the goods and issued let export order confirmed in cross examination that they had made the report/order on the dates appearing in the Shipping Bill(s). In such circumstance, a finding contrary to the official records of the Custom Department cannot be supporetd. It is not established that the officers had predated their signatures on the Shipping Bills. Moreover, it is on record that sale proceeds against the supply of goods were received.
Penalties imposed upon other co-appellants - HELD THAT:- It is found that the evidences on record clearly point out that M/s AEL and M/s World Link supplied the goods to foreign going vessels and there is no diversion of the disputed goods elsewhere as alleged by the department. In such circumstances we do not find any merit in the impugned orders imposing the penalties on the co-appellants.
The impugned orders are liable to be set aside and accordingly the impugned orders are set aside - Appeal allowed.
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2024 (4) TMI 384
Levy of Customs Duty - bunkers lying inside the tanks of the vessel including the consumption between Bedi Port to Alang or not - transshipment of cargo - foreign –going vessel - Scope of SCN - HELD THAT:- Section 86(2) inter alia provides that any stores imported in a vessel or aircraft may with proper permission of the proper officer be transferred to any vessel as stores for consumption therein as provided in Section 87, which inter alia provides that imported stores may, without payment of duty be consumed on the vessel as stores during the period such vessel is a foreign going vessel. In order to appreciate the contention raised in the disputed matter, it is necessary to notice a basic premise that under Customs Act goods entering into India becomes imported goods and chargeable to duty under Section 12, unless they are exempt from payment of duty by virtue of specific provisions. It is significant to note that ship stores or spares thereof are not exempted from the operation of Section 12, but by virtue of Section 53 of the Act are allowed to be transited without payment of duty - Similar provision is found in Section 54 in respect of the goods imported into a customs port or customs airport but is intended for transhipment of goods.
In the present matter, it is found that the tug had originally arrived at Bedi ports from overseas port laden on mother vessel. Mother vessel was unable to complete the delivery of the said tug at Alang owing to requirement of deeper draught which was not available at the ship breaking yard at Alang. The said tug had arrived from foreign port, it was treated as a foreign –going vessel. There is no dispute over the fact that the said tug had not performed any costal voyage or undertaken any coastal operation. Therefore the fuel consumed during their transshipment from Bedi port to Alang cannot be considered as dutiable.
The impugned orders are not sustainable, hence the same are set aside - Appeal allowed.
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2024 (4) TMI 383
IGST exemption at the time of import of input materials by the appellant - Advance Authorization Scheme - HELD THAT:- It is not disputed that, had the appellant paid the IGST at the time of import they would have been eligible for input tax credit. Further, admittedly the goods have been used as inputs for manufacture of other goods which have undisputedly been exported to Hindalco. Admittedly, DGFT have issue ‘Export Obligation Discharge Certificate’ to the appellant. It is further noticed that it is not the policy of the Government to export taxes. It is further found that it is a case of contributory negligence on the part of Revenue also, as inspite of having registrated the Advance Authorisation and the entitlement of the appellant to exemption under Notification No. 21/2015–CUS, have allowed the exemption of IGST also as applicable under Notification No. 18/2015– CUS.
The situation being revenue neutral undisputedly, no case of malafide is made out against the appellant. In this view of the matter, following the ruling of the Apex Court in the NIRLON LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, MUMBAI [2015 (5) TMI 101 - SUPREME COURT], the demand is not invokable by invokation to extended period of limitation.
The impugned order set aside - appeal allowed.
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2024 (4) TMI 382
Smuggling - Absolute confiscation of three gold bars and one small piece of remelted gold - Penalty u/s 112(a) and (b)(i) of Customs Act - failure to examine witnesses during adjudication proceedings - retraction of statements - HELD THAT:- Admittedly, there were no foreign markings on the gold seized and subsequently confiscated, being 1129 gms of gold. Further, admittedly the gold is comprised of bar/rods and bits and is not of standard shape, size and weight, as in the case of gold of foreign origin. It is further found that Revenue has not laid any evidence as to the smuggled nature of gold save and except assumption and presumption based on the statements of Mr. NPK & Mr. VVRK recorded at the time of seizure. As such statements have been subsequently retracted, the initial statements have lost their evidentiary value. It is further found that Revenue has failed to examine their witnesses during adjudication proceedings, as required under section 138B of the Act.
Further, the appellant – Mr. R. Rajasekhar who has claimed the ownership of the gold has led cogent evidence in the form of his business records and account statements in support of the gold in question. It is further found that such cogent explanation has not been found to be untrue but have been arbitrarily rejected by Revenue. It is also found that the explanation given by these appellants has been corroborated by the statement of smelters/melters both at Jaggayyapet and at Chennai. Accordingly, it is found that appellants have discharged the onus under section 123 of the Act.
The impugned orders set aside - appeal allowed.
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