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Customs - Case Laws
Showing 201 to 220 of 38226 Records
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2024 (3) TMI 996
Refund of SAD - amount paid by the Appellant was a deposit in lieu of an inquiry or not - applicability of time limitation on the refund of amount of deposit or not - HELD THAT:- The letter dated 20.06.2017 by which refund amount along with interest dated 12/20.06.2017 had been paid by the appellant of amount of erroneous refund along with interest on same having been communicated to them was voluntarily act and which falls within parameter of requirement of Section 28 1(b) and because of which the proper officer was not required to issue any further show cause notice, unless the erroneous refund was found to be short paid. The appropriation of amount of refund and interest once paid voluntarily by appellant is selfappropriation. The amount thus paid was clearly on account of erroneous refund which vide its payment was accepted by the party obviating any necessity of further show cause notice.
If for any reason appellant wanted refund of such erroneous refund amount paid by them, then the same had to be within the prescribed limitation which as per the concurrent findings of the lower authorities was not done and therefore, the claim filed in the year 2021 was clearly barred by limitation.
Impugned order is therefore maintained and appeal is rejected.
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2024 (3) TMI 995
100% EOU - Denial of benefit of exemption under Notification No. 52/2003-Cus - violation of input output norms - excess generation of waste and scrap - HELD THAT:- The present case is entirely covered by the case of Meridian Impex Vs. CCE & ST,[2018 (7) TMI 865 - CESTAT AHMEDABAD], wherein it is held that after segregation of the mixed imported scrap, the segregated scrap, if cleared, cannot be considered as clearance of the 'inputs as such. The same has been affirmed by the Gujarat High Court in the decision of Commissioner of Customs (Preventive) Vs. Monarch Overseas,[2019 (1) TMI 1513 - GUJARAT HIGH COURT].
It was submitted that Chapter 6 of the Foreign Trade Policy ("FTP") nowhere mentions that for the excess generation of waste and scrap, duty equivalent to the duty on proportionate quantity of imported raw material is required to be paid. Chapter 6 of the FTP provides that there should be no duty demand even in case where the waste or scrap is destroyed in EOU. Further, it is also stated that the byproducts included in the LOP can be sold in DTA with the permission of the Deputy Commissioner on the payment of applicable duties.
Thus, nowhere it was mentioned that duty amount on proportionate raw materials is to be paid in case, there is excess clearance of waste and scrap and therefore the same cannot be demanded. Further, the only restriction on the excess clearance of the waste and scrap is that the same can be cleared on the payment of full duty which the appellants have already paid.
Moreover, as per Chapter 10 of the CBEC's Custom Manual of instruction issued on 11.09.2001 duty on bonded goods can only be demanded in certain specified circumstances. Therefore, the appeal is allowed with consequential relief.
Appeal allowed.
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2024 (3) TMI 994
Levy / Demand of Countervailing Duty (CVD). - whether the appellant can be considered as an importer when the software has been imported by SAP India Pvt. Ltd. (subsidiary company) was contentious and reached before the Tribunal? - Validity of show cause notice - limitation - Interest - penalty - intent to evade customs duty or not - HELD THAT:- If the appellant pays CVD on the goods (software imported by them) they would be able to avail credit of such CVD paid by them. The entire situation is revenue neutral and there cannot be any intent to evade payment of duty. Further, the appellant was under bona fide belief that they have not imported the goods as they have only entered into an agreement with SAP India Pvt. Ltd. for purchase of the software.
The issue as to whether they can be considered as the importer was contentious and had travelled upto to the Tribunal. Taking these aspects into consideration, the issue is also interpretational in nature. We find that by the Department has not established any positive act on the part of the appellant in regard to suppression of facts with intent to evade Customs duty. Thus, we find that there are no grounds for invocation of extended period. The demand of CVD along with the interest and the imposition of penalties cannot sustain. The issue on limitation is answered in favour of the appellant. The impugned order is set aside on the ground of limitation. The appeal is allowed with consequential relief, if any, as per law.
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2024 (3) TMI 993
Refund application for refund of 4% SAD payment - Non-compliance with the mandatory condition of Notification No.102/2007 - issued a deficiency memo - Whether the Chartered Accountant certificate, is sufficient to meet the requirement of unjust enrichment and compliance of the conditions of Notification? - HELD THAT:- In the present case, only objection made by the adjudication authority to reject the refund application is that the Appellant failed to show the due amount of refund as receivable in the books of account and it amounts to non-compliance of the Notification. In impugned order it is further held that the onus of unjust enrichment also not complied. The issue was considered by various authorities and this Tribunal from time to time as stated in ibid paragraphs and it is well settled that once the Appellant produced certificate from concerned Chartered Accountant, it is sufficient to meet the requirement of unjust enrichment and compliance of the conditions of Notification.
The Department have no case that the goods were sold without payment of VAT or Sale Tax as applicable. In the absence of any other objection, impugned order rejecting the refund claim is unsustainable. Following the ratio of the decisions in the matter of Customs, Bangalore Vs M/s Apple India Pvt Ltd [2015 (1) TMI 573 - KARNATAKA HIGH COURT], Chartered Accountant certificate produced by the Appellant is sufficient to allow refund.
Appeals are allowed with consequential relief if any in accordance with law.
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2024 (3) TMI 992
Maintainability of Refund claim - order of assessment in appeal not challenged - quantity discount - import of the pre-fixed quantities - foreign supplier for supply of Chrysotile Asbestos Fibre - HELD THAT:- Admittedly, the appellants have not filed any application under Sections 144 & 149 of the Customs Act, 1962 for rectification or amendment of the Bills of Entry, therefore, the “case laws” relied by the appellants mentioned are no help.
Thus, following the decision of the Hon’ble Apex Court in the case of ITC Limited [2019 (9) TMI 802 - SUPREME COURT], the refund claims are not maintainable as neither Bills of Entry were modified nor the assessments of Bills of Entry were challenged by the appellants. Therefore, the appeals filed by the appellants are dismissed by upholding the impugned order.
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2024 (3) TMI 970
Denial of benefit of the N/N. 52/2003-customs to input/raw material imported by EOU used - denial on the ground that appellant had consumed inputs and generated wastage beyond the norms fixed by norms committee - HELD THAT:- In the instant case for material consumed over and above the SION notification issued by the DGFT, Department views that duty or at least penalty is liable to be charged in case excess wastage comes into play. However, it is found that Hon’ble Gujarat High Court in the matter of COMMISSIONER, CUSTOMS (PREVENTIVE) VERSUS MONARCH OVERSEAS [2019 (1) TMI 1513 - GUJARAT HIGH COURT], while dealing with scope of Notification No. 52/2003–Cus. Dated 03.01.2003 31.03.2003 particularly clause (3) construed the non-obstante clause by interpreting that once the material procured are used for the purpose of manufacture of finished goods or services then even if, waste and scrap arises in course of production and manufacture over the norm then same is also exempt from the duty of custom leviable or the additional duty.
Appeal allowed.
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2024 (3) TMI 938
Seeking rectification of an alleged mistake - error apparent on the face of record or not - submission in the applications is that this Tribunal committed an error because this Tribunal was competent to decide but had not decided the question of jurisdiction - HELD THAT:- These applications seeking rectification of mistake are misconceived. The appellants were represented by a learned counsel who made submissions on their behalf. Needless to say, that when a learned counsel makes submissions, the court has to presume those to be on the instructions of the appellants. After arguing the appeal on merits and partly succeeding and partly failing in the appeal, the appellant then decided to hire a new counsel to find fault with the submissions made by the previous counsel and further alleging that this Tribunal committed a mistake in proceeding on the basis of the submissions made by the previous counsel.
It is also incorrect to say that this Tribunal did not follow the directions of the High Court and had not applied its mind on the question of jurisdiction. It had not only applied its mind but also recorded in paragraphs 1 and 2 of the Final Order the question of jurisdiction not only with respect to the judgment in M/S MANGALI IMPEX LTD., M/S PACE INTERNATIONAL AND OTHERS VERSUS UNION OF INDIA AND OTHERS [2016 (5) TMI 225 - DELHI HIGH COURT], the review petition filed by the Revenue and the further retrospective amendments made by Finance Act, 2022.
Considering the judgments and the subsequent amendments, if it has to be decided if the officer issuing the SCN had jurisdiction or not in this case, it can only be done on the basis of the submissions made by both sides. Both sides did not want to press the question of jurisdiction and therefore the matter was decided on merits and it was decided so.
The Tribunal can rectify if there is a mistake apparent on record. In this case, there are no mistake at all in Final Order, let alone, an error apparent on record. Therefore, the applications deserve to be dismissed and are dismissed.
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2024 (3) TMI 937
Recovery of duty foregone - non-installation of the capital goods and consequent non-fulfilment of post-importation condition - It is the contention that the ‘capital goods’ had not been installed within the prescribed time period and that the export obligation could not, therefore, have been fulfilled - HELD THAT:- It is on record that the ‘capital goods’ were found to have been installed at premises other than that indicated in the licensing documents. It was held in the impugned order that, though the rent agreement for the said premises had been produced, documents evidencing shift of the ‘capital goods’ was neither available nor furnished by the appellant. The imports had been permitted, and duty had been foregone, subject to condition that ‘export obligation’ would be completed within six years. It is also on record that the licensing authority had extended the time-period for effecting the installation which, in effect, re-scheduled the date by which the export obligation would have to be fulfilled.
There is nothing available on record to indicate that, after such installation, as claimed by the appellant in application for relaxation of time for fulfillment had been preferred, exports had been undertaken. It would also appear to us that the deferment of time for installation does not, of itself, re-schedule the deadline for completion of export obligation. The imports had been effected in October 2012 and December 2012 with post-import fulfilment of the export obligation by 2018.
In the facts and circumstances of fulfilment of export obligation not having been evinced and the stipulated deadline prescribed in the authorisations not adhered to, the confirmation of duty liability, equal to the duty foregone, would appear to be reasonable. However, there is no finding on the entitlement for depreciation in proportion to the export performance established from the records. This would have a bearing on the other consequences under Customs Act, 1962. The rectification of that want requires that the impugned order be set aside and matter remanded back to the original authority for fresh decision after consideration of the facts and circumstances including evidence of exports undertaken by deployment of the said capital goods that may be furnished by the appellant herein.
The appeal is disposed off by way of remand.
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2024 (3) TMI 936
Classification of goods - Nutrition/Dietary Supplements classified under Tariff item 21069099 attracts IGST at the rate of 18 % under serial No. 453 and/or 23 of Schedule III of Notification No. 1/2017- Integrated Tax (Rate) dated 28-06-2017 as claimed by the appellant or the said goods is covered under serial No. 9 of Schedule IV of the said notification which provided for IGST at the rate of 28% as claimed by the Revenue? - HELD THAT:- The case of the department is that since goods are covered under Serial No. 9 the same will not fall under either Serial No. 453 or 23 of Schedule III, which is absolutely incorrect. Other than the specified goods covered under Serial No. 9 all other goods fall under Serial No. 453 and/or 23 of any chapter falls under the discerption given therein. We find that the Adjudicating Authority has not given any heed to a vital fact that discerption mentioned in serial No. 9 is only for some specific items which does not cover the goods of the present case. Therefore, the appellant’s goods does not fall under Serial No. 9. Accordingly, the Serial No. 453 and/or 23 of Schedule III is the correct entry where the appellant’s goods fall. Hence, the correct rate of IGST applied by the appellant i.e. 18% is correct and legal.
The identical issue has been considered by this Tribunal in the case of NEUVERA WELLNESS VENTURES P. LTD. VERSUS C.C. MUNDRA [2023 (10) TMI 964 - CESTAT AHMEDABAD] wherein it was held that From tariff entry of 2106, it can be seen that the entry covers various food preparation not elsewhere specified or included. However, out of the many items provided under tariff item 2106, the serial No. 9 described only some of those goods. This also establish that Serial No. 9 is not a general entry which covers entire entry of 2106 but only some of the goods which are specified in the description of goods are provided under serial no. 9 of Schedule IV,. This fact also strengthens the claim of the appellant that their goods are not covered under serial no. 9 of the schedule IV of Notification 1/2017-IGST-Rate and correctly falls under Serial No. 453 according to which the rate of IGST is 18%.
The appellants have correctly declared their goods under Serial No. 453 and/or 23 of Schedule III of Notification No. 1/2017- Integrated Tax (Rate) which attracts 18% of IGST. Therefore, the impugned order is not sustainable.
The impugned order is set aside. Appeal is allowed.
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2024 (3) TMI 935
Classification of imported goods - defatted coconut - to be classified under CTH 08011990 or under CTH 23065020? - Benefit of Notification No.50/2017- Customs dated 30.06.2017 Sl. No. 114 - HELD THAT:- As per the first test report dated 11.11.2020, oil content is 46.8% and it confirm to the FSSAI (Food Products Standards and Food Additives) standard of defatted coconut. There is no reason given in the impugned order-in-original to discard the said finding. Thereafter another set of sample were drawn and sent to Coconut Development Board. Vide report dated 08.12.2020, they have also classified that sample submitted is defatted coconut and oil content was 45.51%. Alleging that the said report was not clear about the parameter for identifying the defatted and desiccated coconut, on further query was made and they have confirmed that as per Codex committee there is no difference between defatted and desiccated coconut.
The adjudicating authority proceed with technical standards for desiccated coconut as per CODEX standard (CODEX STAN 177-1991) and concluded that goods which was defatted coconut is low fat desiccated coconut classifiable as under CTH 08011110. Such presumption is drawn on conclusion that to bring the goods under CTH 2306, oil should have removed from them and in the nature of residues material suitable for any subsequent use after there primary use in food industry. Such finding is arrived without considering the standard prescribed by the FSSAI and only based on the standard of Codex. Such method adopted by the adjudicating authority for classification of food articles is prima facie unsustainable. Moreover, Revenue is not disputing the fact that similar goods are being imported through Chennai port.
There is no infirmity in the order issued by the Commissioner (Appeal) - Revenue is directed to classify the goods as per the declaration made by the respondent by extending the benefit of notification as applicable - Appeal dismissed.
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2024 (3) TMI 934
Valuation of imported goods - Cement Carrier ship - rejection of transaction value - redetermination of value - inclusion of handling charges, transportation, cost of insurance and landing charges in assessable value - failure to declare the value of Bunkers on board at the time of delivery at Colombo.
Mis-declaring the value of ship by not adding value of transportation, cost of insurance and lending charges - failure to declare the value of Bunkers on board at the time of delivery at Colombo - HELD THAT:- In the present case, though the invoice value of Rs. 26,91,00,000/- was declared at the time of import, as per the prevailing practice, at the request of appellant, it was subject to valuation by Chartered Engineer and as per the valuation report, chartered engineer assessed the value of ship as Rs. 27,00,00,000/- and based on the above said value, it was allowed to clear on payment of proper Custom duty. Now in addition to that, adjudicating authority is adding 20% as cost of transportation, handling charges of 1.125% and 1% of assessable value for confirming demand of Rs. 30,31,174/- - The inclusion of ‘freight’ and ‘insurance’ in the assessable value in commercial parlance, is designated as ‘CIF’ in transactions. The vessel, ever coursing the seas and oceans, does not take on additional insurance merely for the purposes of movement to a destination for registration and the cost of self-propulsion does not add to the value of the vessel. Moreover as per the estimated voyage cost produced by the appellant, they have added cost of Rs. 1,70,595/- towards cost of voyage and other expenses for the fuel from Colombo to Mangalore Port and paid customs duty. Consequently, the enhancement of ‘assessable value’ beyond the value assessed by Chartered Engineer fails on every count.
Adding the cost of Bunkers, based on the balance quantity of Bunkers at Mangalore port - HELD THAT:- The issue is squarely covered by the judgment of the Hon’ble Supreme court in the matter Mangalore Refinery & Petrochemicals Ltd. Vs. CC, Mangalore, [2015 (9) TMI 245 - SUPREME COURT] where it is held that the quantity actually received into the shore tank in port in India should be the basis for payment of Customs duty, being the goods imported into India. Considering the law laid down by the apex court, demand of duty for the balance quantity of Bunkers available in Colombo at the time of delivery of the ship cannot be added towards the cost of Bunkers.
Regarding value, as per the request of the appellant, Chartered Engineer carried out survey and as per the report No. AR/016/2011-12 dated 09.05.2011, value assessed the as Rs 27 Crores. Hence this appeal is allowed by accepting the assessable value of the goods as Rs. 27 Crores and additional demand of customs duty against cost of transportation, insurance and handling charges as demanded in the impugned order is set aside - Since there is no suppression of fact, confiscation of the ship and fine and penalty imposed by the adjudicating authority is set aside. The impugned order modified to the extent of confirming assessable value as Rs. 27 Crores.
Appeal allowed in part.
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2024 (3) TMI 933
Valuation of imported goods - Unwrought / Unrefined Zinc - enhancement of value - rejection of transaction value - demand of additional duty on the basis of NIDB data for primary Zinc ingots - contemporaneous imports or not - HELD THAT:- The Department has rejected the transaction value and redetermined the same on the basis of LME price considering the percentage of Zinc content in the consignments in terms of the Test Report of CRCL, Kolkata. As per the Test Report, the Zinc content in Bill-of-Entry No. 4533688 dated 10.03.2016 was 87.80% and the Zinc content in Bill-of-Entry No. 8650713 dated 19.03.2015 was 92.50%. The Ld. Authorized Representative appearing for the Revenue was asked to furnish a copy of both the Test Reports. However, the Ld. Authorized Representative could not submit a copy of the Test Report for the Bill-of-Entry No. 8650713 dated 19.03.2015. It is observed that the percentage of Zinc should be above 92% in “‘Zinc dross”. Only in the Bill-of-Entry No. 8650713 dated 19.03.2015, the Zinc percentage was found to be more than 92%. However, no such report has been produced by the Department to substantiate this claim. In the absence of a Test Report, it cannot be considered that the percentage of Zinc content in the goods imported by the respondent was above 92%.
In respect of the other Bill-of-Entry No. 4533688 dated 10.03.2016, the percentage of Zinc content was found to be only 87.80%, which is less than 92%. Accordingly, these goods cannot be considered as “Zinc dross” which are restricted as per the Foreign Trade Policy.
The Department has not brought any evidence on record to substantiate their claim that the percentage of Zinc content in both the Bills-of-Entry was more than 92% so as to classify the same as “Zinc dross”. Accordingly, there is no infirmity in the impugned order passed by the Ld. Commissioner (Appeals) and therefore, the impugned order passed by the Ld. Commissioner (Appeals) is upheld.
The appeal filed by the Department is rejected.
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2024 (3) TMI 932
Smuggling - Betel Nuts - foreign origin goods - town seizure - notified item or not - onus to prove - HELD THAT:- It is a case of town seizure of betel nuts which is not a notified item under Section 123 of the Customs Act, 1962. Therefore, the onus to prove that the betel nuts are a smuggled one is on the Revenue. At the time of interception, the appellant has produced documents pertaining to procurement of the said betel nuts through proper channel. In that circumstances, we hold that the Revenue has failed to discharge their onus to prove that the goods impugned are a smuggled one or of foreign origin.
As Revenue has failed to discharge their onus that the goods in question are a smuggled one, in these circumstances, the confiscation of the impugned goods is not sustainable in the eyes of law and therefore, confiscation of the impugned goods is set aside. As the goods are not liable for confiscation, consequently no penalty is imposable on the appellants.
The impugned order set aside - appeal allowed.
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2024 (3) TMI 875
Misuse of Advance Authorisation for export of garments - Benefit of Customs Notification No. 99/2009 dated 11.09.2009 denied - confiscation of fabrics imported - imposition of penalties - denial of cross examination of all the witnesses - Diversion of imported goods into open market without using the same in export goods - HELD THAT:- The modus operandi adopted by the appellant, the active role of Shri Rakesh Goyal to defraud the Government have been brought out clearly by the statements of Shri Sunil Kumar, the broker and Shri Ajay Kumar Goyal, conoticee and other statements as discussed in the impugned order.
Denial of cross examination of all the witnesses - HELD THAT:- The Department had partly acceded to the request for cross examination, and four witnesses were cross examined. However, the appellant has sought cross examination of a greater number of people, which is not justified. It is noted that neither the appellant nor the Director cooperated with the Department during investigations. They did not voluntarily come forward to assist the investigations to negate the allegations of the Department.
It is brought on record that Shri Manish Suneja had actively connived with the appellant to divert the imported raw materials to the open market. We take note that the Revenue has investigated each consignment and has indicated as to how and where the said consignments were disposed off. This is corroborated by the statements recorded under section 108 of the Customs Act, 1962. Consequently, the findings in the impugned order that the impugned goods have not been delivered at the factory premises of the actual user as mentioned in the condition sheet of the Advance Authorization is upheld.
The benefit of Notification 99/2009-Cus dt 11.09.2009 cannot be extended to the appellant in view of the overwhelming evidence of diversion of imported raw material to the open market - The contention of the appellant that the export obligation against the Advance authorisation was completed stands negated by the letter dt 30.6.2015 issued by DGFT wherein it was stated that for the advance authorization no. 3010093690 dated 07.05.2013, the show cause notice was issued to the party on 29.06.2015. In addition, vide their letter dated 13.08.2015, it was confirmed that demand notice dated 18.11.2014 had been issued.
There are no reason to interfere with the impugned order. Accordingly, all the four appeals filed by the appellant are dismissed.
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2024 (3) TMI 874
Valuation of imported goods - rejection of declared value - Inclusion of lump sum and periodical patent and technology know how fee paid by appellant to the foreign company in the transaction value - order passed by Commissioner (Appeals) remanding the matter to the adjudicating authority to reconsider the rejection of transaction value is legal and proper or not.
Whether the lump sum and periodical patent and technology know how fee paid by appellant to the foreign company has to be included in the transaction value is legal and proper? - HELD THAT:- As per Rule 10 (1) (c), the payment in the nature of royalty or technical know how must be a condition pre-requisite for the supply of imported goods by the foreign supplier. The royalty or technical know-how fee is to be included, if directly or indirectly it is a condition of the sale of imported machinery. The department therefore has not only to look whether there is payment of royalty or technical know how fee, but also have to examine the pricing arrangement agreed by the parties. Only if the royalty and technical know how fee is paid as a condition of sale of the machinery, it can be added to the transaction value. In the present case, there are nothing stipulated in the agreement that payment of royalty and technical know-how fee is a condition of sale of the imported machinery. The department has not been able to adduce any evidence in this regard.
The Hon’ble Apex Court in the case of COMMISSIONER OF CUS. (PORT), CHENNAI VERSUS TOYOTA KIRLOSKAR MOTOR P. LTD. [2007 (5) TMI 20 - SUPREME COURT] had occasion to analyse the very same issue in regard to erstwhile Rule 9 (1) (c) of Customs Valuation (Determination of Price of Imported Goods), Rules, 1988. It was held that royalty and technical know how fee must be payable by the importer as a condition of import and that a distinction clearly exists between the amount payable as a condition of import and the amount payable in respect of the manufacturing activity.
The royalty and technology know how fee being not a condition of sale, is not to be included in the transaction value. The issue is held in favour of the appellant.
Whether the order passed by Commissioner (Appeals) remanding the matter to the adjudicating authority to reconsider the rejection of transaction value is legal and proper? - HELD THAT:- From the order passed by the adjudicating authority, it is found that in the operative portion of the order, it is stated that the ‘transaction value is rejected’. However, there is no discussion or re-determination of transaction value. The original authority has assumed that for loading the royalty and technology know how fees, the transaction value has to be rejected. The department has filed appeal before the Commissioner (Appeals) against this order of adjudicating authority contending that if the transaction value is rejected, the same ought to have been redetermined by the original authority which he has not done. The Commissioner (Appeals) in internal page 5 of the impugned order has discussed this issue and observed that once the transaction value has been set aside, it is for the adjudicating authority to redetermine the same. For this limited purpose, the matter has been remanded by him. The finding of the original authority rejecting the transaction value is patently erroneous.
The department does not dispute the transaction value declared by importer and the only issue is as to whether the patent and technical know how fee is to be loaded to the transaction value. There is no requirement to remand the matter for this purpose so as to redetermine the transaction value as there is no grounds stated for rejecting the transaction value. The declared transaction value is upheld. The order for loading the royalty and technology know how fee to the transaction value is set aside.
Appeal allowed.
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2024 (3) TMI 873
Refund including cash refund of DEPB/FPS scrips - denial on the ground that refund claims were hit by the principles of unjust enrichment - Determination of product prices based on the prevailing price for copper in the London Metal Exchange (LME). - HELD THAT:- In M/S. VEDANTA LTD. VERSUS CC, TUTICORIN (VICE-VERSA) [2018 (6) TMI 528 - CESTAT CHENNAI], relied upon by the First Appellate Authority as well as the respondent, it is found that there is no change in the facts; admittedly, the price prevailing in LME was in no way under the control of the respondent and further, this Bench in the respondent’s own case has categorically held that the final product price is based on the price prevailing in LME which has no relation to the cost of raw material including customs duty, for which reliance has been placed on the decision of the Hon'ble Supreme Court in the case of STATE OF RAJASTHAN & ORS VERSUS HINDUSTAN COPPER LTD. [1997 (11) TMI 516 - SUPREME COURT] - This Bench has thus concluded that the stand of the Revenue insofar as unjust enrichment was concerned, had no merit.
The Revenue has not been able to distinguish the above case nor is there any evidence placed on record to aver that there was any change in either facts or law, nor has the Revenue placed anything on record to state that the above final orders have been appealed to higher judicial forum and, if so, the status of the same. Hence the ratio of the above order squarely applies to the case on hand as well.
The Revenue has not made out a case to disturb the finding of the First Appellate Authority in the impugned order. Consequently, Revenue’s appeal lacks merit - the appeal filed by the Revenue is dismissed.
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2024 (3) TMI 872
Re-assessment of imported goods - 30 MT of PVC Resin SG 5 (Suspension Grade) - it appeared that the goods were liable to anti-dumping duty @ USD 147.96 PMT in terms of Sl. No. 2 of Notification No. 32/2 -Customs (ADD) dated 10.08.2019 instead of Sl. No. 1 of the said notification prescribed anti-dumping duty @ USD 61.14 PMT, as claimed by the appellant - HELD THAT:- The invoices and packing list, as well as Bill of Lading clearly indicate that the manufacture is M/s. Xinjiang Shengxiong Chlor-Alkali Co. Ltd. The certificate at page 41 also indicates that manufacturing is by M/s. Xinjiang Shengxiong Chlor-Alkali Co. Ltd. Company, a group company of M/s. Xinjiang Zhongtai Chemical Co. Ltd. It is thus clear from the evidence that the Alkali Company (XSCCL) was actually the manufacturer and M/s. Zhonglai Chemical Co. Ltd.(XZCCL) had only exported goods clearly mentioning that Alkali Company was the manufacturer and also that their company was exporter. Even the certificate of origin of Chinese authority mentions that exporter was M/s. Zhonglai Chemical Co. Ltd., and the name of manufacturer was M/s. Xinjiang Shengxiong Chlor-Alkali Co. Ltd and this has remained an unrebutted piece of evidence by an independent authority. Further learned advocate has provided para 33 of the final findings of Notification of Anti Dumping Authorities, which mentions Alkali Co., as producer and Chemical Co., as exporter.
The Order-In-Appeal is not maintainable and the Bill of Entry was correctly filed in so far as claim of ADD at lower rate was concerned - appeal allowed in part.
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2024 (3) TMI 871
Valuation of imported goods - stamping foils - rejection of declared value - enhancement of value - statement relied upon by the department was recorded under duress or under coercion or undue influence - It is seen that the department’s case is based primarily on the evidence of retrieval of data from the hard disk seized from the premises of the appellant firm - HELD THAT:- On consideration of overall circumstances in which the statement of director Shri. Ramesh K Gidwani was recorded and pattern of the same including the content of the initial statement which while indicating proforma invoice to be correct value did not mention the relevant grade of stamping foils also. The medical evidence about injuries and their treatments were mentioned while rebutting letters of the department in their retraction.
It is also found that though the Hon’ble High Court of Gujarat in KIRAN TEX FAB PVT LTD & 1 VERSUS UNION OF INDIA THROUGH SECRETARY & 6 [2011 (5) TMI 941 - GUJARAT HIGH COURT] has not specifically dealt with the fact of coercion while granting relief of presence of advocate. The series of statements recorded thereafter of the directors are exculpatory. It is thus clear that they were serious doubts on record as to the nature of initial statement and the onus clearly shifted on the department to indicate that the initial statement dated 13.10.2010 was voluntary and same should have been subjected to examination-in-chief by the adjudicating authority, at least in the factual background of the matter before placing reliance on the same.
When statement was retracted, the investigating officer instead of pronouncing his own version as to why the statement was voluntarily, should have instead of left this job to be done by the adjudicating authority while adjudicating the matter. Another opportunity before higher officer can be an apt course of action to follow in such situation - it is found that initial statement dated 13.10.2010 could not have been relied upon without discharge of burden by the department of same being voluntary by examination of the entire statement of director by the adjudicating authority. Apart from above, it is also found that there is no evidence on record of any excess payment having been made of excess remittance, and admission of the same.
Thus, it is clear that not only Customs Valuation Rules have to be sequentially followed but also that the electronic evidence can only be relied upon by the department as per provision of Section 138C which lays down various conditions in sub clause (2) about which there is no mention of the same having been followed.
Thus, in the facts and circumstances of the matter enhancement of value as well as appreciation of evidence has been improperly done in the impugned order - the impugned order is therefore, set aside - appeal allowed.
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2024 (3) TMI 870
Valuation of imported goods - inclusion of royalty and the cost of advertisement incurred by the Appellant in India in assessable value - related party - Rule 10(1)(c) and Rule 10 (1)(e) of the Customs Valuation Rules 2007 - demand of differential duty alongwith interest, redemption fine and penalty - extended period of limitation - HELD THAT:- Rule 10(1)(e) 0f the Customs Valuation Rules 2007 provides for addition of all other payments actually made or to be made as a condition of sale of the imported goods, by the buyer to the seller or by the buyer to a third party to satisfy and obligation of the seller, to the extent that such payments are not included in the price actually paid (transaction value). It is found that there is total absence of the prescribed condition present as the appellant is not obliged to incur any particular amount or percentage of invoice value towards sales promotion/ advertisement. Further, we find that the activity of advertisement and sales promotion is a post-import activity incurred by the appellant on its own account and not for discharge for any obligation of the seller under the terms of sale - As per the stipulation in the agreement, the appellant is obliged to be responsible for sales and distribution in its territory of distribution and further to make such expenditure in consultation with the seller, does not attract the provisions of Rule 10(1)(e) of CV Rules.
The appellant and M/s. Speedo or M/s. Jockey International are no way related parties as their relationship is principal to principal basis and the fact they are sole distributor in no way makes them related parties as per the Customs Act or the Valuation Rules. Moreover, they have imported from unrelated suppliers who have nothing to do with Jockey International and the distributed products have nothing to do with the licensed products as far as royalty is concerned. The issue being one of interpretation of what should be the value there is nothing brought on record to prove any wilful suppression of facts and therefore invocation of extended period is not justified.
The impugned order set aside - appeal allowed.
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2024 (3) TMI 869
Classification of imported goods - fish protein - to be classified under Customs Tariff Heading 3504 0099 or under chapter heading 0511 9190? - suppression of the correct description of the goods/ misdeclaration of goods - invocation of Extended period of limitation.
Whether the imported item is fish protein as declared by the appellant or is it processed/demineralised fish scales at as per the test reports? - HELD THAT:- There is no dispute that the Fish Scales have undergone the process called Decalcification or demineralization. The resultant product essentially consists of protein and moisture, with traces of inorganic substances (i.e. crude ash) and other impurities. The decalcified Fish Scale contains various types of proteins of which Collagen Protein Type I is the major ingredient and the Proteins are made up of diverse amino acids, out of them the main amino acids that make collagen are Proline, Glycine and Hydroxy proline and this type of Protein is called as Collagen and Collagen Protein is the most abundant of the Protein in the Fish Scale are not at all in dispute. Demineralisation is considered as the primary procedure for preparation of the scale for the extraction of collagen. Based on the above it is very clear that the product imported by itself is not a protein but the protein is extracted only after further processing is being undertaken by the appellant - It is also admitted that after certain processes the protein is extracted and then exported. Therefore, the question arises whether the item is classifiable as demineralised fish scale under chapter heading 0511 or as protein under CTH 3504.
Whether the product is to be classified under chapter heading 0511 9190 based on the description is demineralised fish scales allowed to be classified under chapter heading 3504 0099 as claimed by the appellant? - HELD THAT:- In the present case, the test reports and the technical literature clearly establish that the product imported is demineralised fish scale. As observed by the apex court in the above case the content of protein cannot establish the product as a protein instead it is only a source of protein. More over there is a specific entry for fish waste and it is a settled issued that specific entry will be preferred over other entries and the chapter notes, headings and the explanatory notes clearly establish the product is rightly classifiable under Chapter 5. In view of the above, the products imported by the appellant are rightly classifiable under Chapter Heading 0511 9090.
As rightly stated by the Learned Senior Counsel for the Revenue in physical appearance and smell, the goods were nothing but fish scales, the only process that raw fish scales had undergone is removal of calcium from the outer layer of the fish scales, which was only a preparatory process for further extraction of protein called collagen. It is also an admitted fact that the item imported is not protein but a rich source of protein the processes undertaken by the appellant in their factory clearly bring out this aspect. Classification is based on the description at the time of import and not on the basis of its content as claimed by the appellant.
Whether the appellant had mis-declared the description of the product in order to claim the benefit of advance authorization? - HELD THAT:- The question of disallowing the benefit of advance authorisation scheme during this period is not sustainable in as much as the goods were declared as fish protein and item was cleared as fish protein as per the advance authorisation scheme. Moreover, these imported goods were actually used in the manufacture of export goods and exported as per the notification 96/2009 is also not under dispute. The fact remains that all the conditions of the notification were satisfied and accordingly all the bills of entry serial number 1 to 42 are to be allowed as per the advance authorisation scheme since the above test reports holds good for all imports made during this period where no fresh samples were drawn or tested.
The advance authorisation license obtained by them for fish protein is a misdeclaration and therefore the imports made by the appellants are not in accordance with the provisions of the Foreign Trade Policy. The import of these products shall be allowed only against a sanitary import permit to be issued by this department as per the procedure laid down in the first schedule annexed to this Notification. For the reasons discussed above the benefit of Advance authorisation is to be denied only prospectively for the consignments where samples were drawn and thereafter. Accordingly, the demand is upheld for 6 bills of entry from Sl.no 43 to 48. The other 9 bills of entry which are provisionally assessed are to be reassessed by reclassifying the same under Chapter Heading 0511.
Whether the appellant had made any willful mis-declaration of the description of the goods which attracted invocation of extended period under the provisions of the Customs act 1962 which warranted imposition of various penalties? - HELD THAT:- Since it is a classification issue and the question of benefit of the scheme is allowed for 42 consignments and the other 9 consignments are under provisional assessments, the question of redemption fine or penalty does not arise.
Appeal allowed in part.
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