|
Advanced Search Options
Customs - Case Laws
Showing 241 to 260 of 38343 Records
-
2024 (4) TMI 47 - CESTAT HYDERABAD
Valuation of the export goods on which duty has to be paid - case of the Department is that the contract price entered into by the appellant and its overseas buyer should be determined as per the test report of the Chemical Examiner of CRCL - inclusion of additional consideration for sale or not.
Can the transaction value between the buyer and seller be modified by the Customs based on the test report of the chemical examiner of CRCL when the price should be finalised as per the test report of CIQ as per the agreement between the buyer and seller? - HELD THAT:- In this case, the transaction value as per the agreement has an adjustment clause which provided that the value shall be re-determined as per the test report of CIQ. The Customs officers cannot change this transaction value or the stipulation of the test report of CIQ being the determinant of the transaction value. The report of Chemical examiner, CRCL is irrelevant to the transaction value. It will be a different matter if the testing has to be done for some Customs purpose, say, to determine the nature of the goods or if the availability of the exemption notification depended on the Fe content of the export goods, etc. Then, the customs officers can rely on the CRCL’s test report. Thus, the impugned order re-determining the transaction value based on the CRCL test report is not correct and cannot be sustained.
The decision of this tribunal in KIMMI STEELS PVT. LTD. VERSUS COMMISSIONER [2019 (11) TMI 741 - SC ORDER] upheld by the Supreme Court has been relied on by the Revenue. That case was completely different although the goods were iron ore fines in that case as well. During the relevant period in that case, export duty was chargeable on weight with a partial exemption notification if the Fe content was below a certain threshold. There were conflicting test reports regarding the Fe content and in the absence of clarity regarding the entitlement to the exemption notification, it was denied.
This question is answered in favour of the exporter and against the Revenue.
Can the US$ 10 per MT be added as additional consideration for sale in the case? - HELD THAT:- As is evident from the proviso to sub-section (1) of Section 14 and the Export Valuation Rules, unlike in case of import valuation, Commissions paid cannot be added for the purpose of determining the value in case of exports even if it was paid by the exporter - The case of the Revenue, however, is that the amount paid by the buyer to M/s. Reliance, Hong Kong, the agent, is an additional consideration for sale as this amount which was to be paid by the exporter was, instead paid by the importer and thereby the transaction value was reduced. Therefore, according to the Revenue, price was not the sole consideration for sale in this case.
If, indeed, the price was not the sole consideration for sale, the transaction value can be rejected under Rule 8 of the Export Valuation Rules and then, it must be redetermined sequentially through Rules 4 to 6. Rule 4 provides for determining the value based on the transaction value of goods of like kind and quality exported at or about the same time. Rule 5 provides for valuation based on a computed value, including cost of production, manufacture or processing of export goods, charges, if any, for the design or brand and an amount towards profit. Rule 6 is a residual Rule to be applied if Rules 4 and 5 do not apply. None of these Rules provide for addition of an amount as additional consideration for sale - this amount of US$ 10 per MT cannot be added as additional consideration for sale to the export price. If there was additional consideration for sale, the proper course would have been to the officer to reject the transaction value and re-determine the value under Rule 4 or Rule 5 or Rule 6 sequentially.
Both the questions are answered in favour of the appellants and against the Revenue - appeal allowed.
-
2024 (4) TMI 46 - CESTAT CHENNAI
Classification of imported goods - AJI-NO-MOTO - rightly classifiable under CTH 2106 9060 or under CTH 3824 9900? - denial of benefit of N/N. 46/2011 dated 1.6.2011 - demand of differential duty alongwith interest and penalty - extended period of limitation - HELD THAT:- It should however be understood that a decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically flows from the various observations made in the judgment. In the case of INDO NISSIN FOODS LTD. VERSUS COMMISSIONER OF CUSTOMS, CHENNAI [2001 (5) TMI 378 - CEGAT, CHENNAI], the item imported was flavour enhancers/ potentiators. The issue was whether the goods required a license to be cleared. The Appellant had in the Bill of Entry declared the item to be food additives and paid customs duty under Chapter 3823.00. Therefore, there was no challenge to the classification made in the Bill of Entry. Hence the matter is distinguished.
Sine the correct classification of the goods is under CTH 2106 9060 the goods are not eligible for exemption under Sl. No. 499(I) of Notification No. 46/2011 and the impugned order is upheld in this regard.
Invocation of the extended period - imposition of penalty - HELD THAT:- It is seen that the impugned goods were imported by filing 68 bills of entry, from 1-12-2017 to 29-10-2022 by declaring them as ‘Ajitide I+G’. It is the Revenues case that by making an incomplete declaration of the goods (suppression of facts) and mis-classifying them has lead to evasion of duty and hence the extended period of time as per section 28(4) of the Customs Act 1962 is rightly invokable and the goods are liable for confiscation under Section 111(m) & (o) ibid and the importer is also liable for a penalty.
The Hon'ble Supreme Court in NORTHERN PLASTIC LTD. VERSUS COLLECTOR OF CUSTOMS & CENTRAL EXCISE [1998 (7) TMI 91 - SUPREME COURT] has held that merely claiming the benefit of exemption or a particular classification under the bill of entry does not amount to mis-declaration or suppression of facts. Something more is required. Although the judgment was pronounced before the 'Self-Assessment' system has been introduced in respect of Customs clearance of imported goods under Section 17 of Customs Act,1962, with effect from 8-4-2O11, we find that earlier consignments bearing the same description, same classification were cleared by the department, vide 68 Bills of Entry, from 1-12-2017 to 29-10-2022. In the circumstances it cannot prima facie be said that there was an intention on the part of the appellant to mis-declare the goods. Nor has Revenue brought in some additional facts to prove its case of ‘suppression’. The goods are basically a mixture of chemicals used in the food industry and an arguable case has been made out by the Appellant, which is not a mere excuse to escape payment of duty. Hence the demand will only survive for the normal period and no penalty or fine is imposable.
The impugned order is upheld including the denial of the claim for exemption from duty but with the modification that the demand is limited to the normal period along with applicable interest. The fine and penalty imposed are set aside - Appeal disposed off.
-
2024 (4) TMI 45 - CESTAT BANGALORE
Imposition of penalties u/s 112(a) of the Customs Act 1962 on Customs broker - import of used Multifunction Digital Photocopiers and Printers - it is alleged that the appellant had connived with the importers - evidence to prove the allegations - HELD THAT:- The Tribunal in SRIVENKATESWARA REPRO GRAPHICS, BEST MEGA INTERNATIONAL, SUPREME ENTERPRISES, BEDY ASSOCIATES, DATA ENTERPRISES, SKYLARK OFFICE MACHINES, LAKSHMI NARAYANAN RAO, SURESH KUMAR KHETTARPAL, MOKSHA BUSINESS MACHINES, MR RAJESH N KUMAR KHATTERPAL, UNISTAR ENTERPRISES VERSUS COMMISSIONER OF CUSTOMS COCHIN-CUS, COMMISSIONER OF CENTRAL TAX & CENTRAL EXCISE, COCHIN [2019 (5) TMI 397 - CESTAT BANGALORE] held that the secondhand Multifunction Digital Photocopiers and Printers (MFDs) were restricted goods and hence, liable for confiscation under Section 111(d) of the Customs Act 1962, and allowed the goods to be redeemed on payment of redemption fine and penalty on the enhanced value. In addition, penalty under Section 112(a) on the firm was also upheld.
There is nothing on record as evidence to prove the involvement of the appellant directly or indirectly that he had connived with the importer. It also intimated that no action was initiated against the appellant under the Customs Broker Regulations till date and therefore, the appellants claim that in good faith he had filed the documents as per the importers’ directions cannot be ignored.
As there is nothing on record to prove that the appellant had connived/abetted with the importers in filing the documents for importing the restricted products without the mandatory documents, the penalty cannot be sustained. The impugned orders for the said offence have already penalized the importers in terms of redemption fine and penalty.
As held by the Tribunal in the case of G. NARAYAN & CO. VERSUS COMMISSIONER OF CUSTOMS MANGALORE [2021 (3) TMI 560 - CESTAT BANGALORE], since the appellant has not been penalized under the Customs House Agents Licensing Regulations, for any irregularity, the question of imposing penalty under Section 112a of the Customs Act, 1962 does not arise.
The penalties imposed on the appellant are set aside - appeals are allowed.
-
2024 (4) TMI 44 - CESTAT KOLKATA
Validity of proceedings against importer when the sole proprietor of the firm had expired - mis -declaration and short payment of duty - imposition of penalty on appellant - HELD THAT:- It is found that no proceedings can continue under the Customs Act in case when the sole proprietor, Shri Prahlad Agarwal of M/s Ganpati Enterprises, on 04.03.2010 expired and the Death Certificate was also placed before the adjudicating authority. As the sole proprietor has passed away, then the proceedings against the importer, M/s Ganpati Enterprises, abates and there is no provisions under the Customs Act, 1962 to continue the proceedings against the the legal heir, Shri Ritesh Agarwal in the impugned proceedings as held by the Hon’ble Apex Court in the case of SHABINA ABRAHAM AND OTHERS VERSUS COLLECTOR OF CENTRAL EXCISE & CUSTOMS [2015 (7) TMI 1036 - SUPREME COURT], wherein the Hon’ble Apex Court has held Section 6 of the Central Excises Act, which prescribes a procedure for registration of certain persons who are engaged in the process of production or manufacture of any specified goods mentioned in the schedule to the said Act does not throw any light on the question at hand as it says nothing about how a dead person’s assessment is to continue after his death in respect of excise duty that may have escaped assessment.
Thus, no proceedings can continue against the importer, M/s Ganpati Enterprises and Shri Ritesh Agarwal, who is the legal heir of the proprietor of M/s Ganpati Enterprises.
Imposition of penalty on Shri Jagdish Prasad Khaitan - HELD THAT:- There is no role involved in the import of the impugned consignment by M/s Ganpati Enterprises as he was involved only at the time of delivery of the goods released provisionally, therefore, no nexus has been proved by the Revenue against Shri Jagdish Prasad Khaitan. Accordingly, no penalty is imposable on Shri Jagdish Prasad Khaitan.
The impugned order is set aside and the appeal filed by M/s Ganpati Enterprises abates and the appeals filed by Shri Ritesh Agarwal and Shri Jagdish Prasad Khaitan, are allowed.
-
2024 (4) TMI 43 - CESTAT KOLKATA
Smuggling - foreign origin Gold - burden to prove purchase has been discharged by the Appellant under section 123 of Customs Act - seized goods are liable to confiscation or not - difference of opinion - HELD THAT:- The Show Cause Notice has proceeded on an erroneous notion that the burden of proof is required to be jointly discharged by Appellant No. 1 to 4 along with Appellant No. 5. In fact the only person who would be required to discharge the burden of proof would be Appellant No. 5. Framing of charges on Appellant No. 1 to 4 on this count is erroneous. The ownership claimant Rinku Verma [Appellant No. 5] has produced 4 Invoices towards purchase from Snehal Gems Pvt Ltd. The transaction details by way of ledger and bank have been produced by him. Taking this lead, the Revenue has caused investigation at the end of Snehal Gems, who have confirmed the transactions in respect of 4 Invoices and also produced their purchase invoices and many other records which are part of the relied upon documents in the Show Cause Notice. No proper conclusion has been arrived at by Revenue to disprove the claims of Rinku Verma and Snehal Gems Pvt Ltd. The issues raised in the reply to Show Cause Notice have not been properly addressed.
The Revenue had an original lead about the procurement of the gold in question by way of cash transaction between Shashi Kant Patil and Rinku Verma. Even as it was important for the Revenue to prove the gold in question was not procured from Snehal, in view of clear lead, the Revenue was also required to prove that the gold in question was procured way of cash transactions from Shashi Kant Patil. This lead has been completely abandoned without any proper reason. This is a serious lapse on the part of the Revenue - In this case, since there were contrary claims, the onus was on the Revenue was on two folds. Firstly, to disprove the claim of Rinku Verma that the gold was procured through proper Invoices, secondly to prove that the gold was in fact procured on cash basis from Shashi Kant Patil. As per my detailed observations, on both these counts, the Revenue has failed.
The onus under Section 123 stands discharged by Appellant No. 5 [claimant of ownership] since Revenue has not come out with any specific adverse evidence against these Invoices and transactions. Also Appellants 1 to 4 were in no way required to discharge this burden in terms of Section 123.
The Hon’ble Member Judicial is agreed upon that burden of proof stands discharged under Section 123 and hold that seized goods are not liable for confiscation - The reference is answered and the difference of opinion stands resolved.
-
2024 (4) TMI 42 - CESTAT MUMBAI
Classification of imported goods - different categories of "IP Phones" such as (i) IP Audio Phones (ii) IP Audio Conference Phones (iii) Wireless IP Phones (iv) IP Video Phones - IP Audio phones and IP Audio Conference phones under CTI 8517 1810 or not - Wireless IP Phones to be classified under CTI 8517 1210 or not - HELD THAT:- The dispute with regard to classification of IP Phones under consideration has a clear functionality of telephony inasmuch as it is used for communication of speech or audio signals to other person. Its added features that enable the IP phone to communicate through internet, Ethernet cable or WiFi connection in the form of data does not change the essential nature of communication device. As seen from the data-sheet as above, the IP phones consist of transmission and reception hardware such as telephone handset, speaker, dialing push buttons, transmission and reception of audio signals either by converting it as data packets or otherwise, power module etc. From the above discussion, the IP phones is classifiable under 8517 18 10, as the principal function of these equipment remain as ‘telephony’.
It is obvious that since IP Phones are complete products by themselves, the classification is feasible either under the ‘first single dash’ or the ‘second single dash’ entries and classification under ‘third single dash’ entry is ruled out, as these are not ‘parts’.
From perusal of the detailed coverage of the goods under the scope of the above entries in the second single dash entry, it would become clear that IP Phones does not match the specific description of any of the apparatus mentioned in the ‘--' entry of the second group at (II) above, namely ‘Base stations’ and various ‘---' entries, such as ‘PLCC equipment, voice frequency telegraphy, Modems, High bit rate digital subscriber line system, Digital loop carrier system, Synchronous digital hierarchy system and Multiplexers’ which are also explained in detail under paragraphs(A) to (G) of HS Explanatory Notes. Even if, one would like to attempt to bring IP phones under second group of ‘-‘ items, treating it as an apparatus which allows for connection to a wired or wireless communication network or the transmission or reception of speech or other sounds, images or other data within such a network, then the only entry that could be feasible is ‘others’.
The products under consideration i.e., (i) ‘IP Audio Phones’ (ii) ‘IP Audio Conference Phones’ of various models of ‘CISCO’ brand would appropriately be classifiable under Customs Tariff Item (CTH) 8517 18 10 and not under CTH 8517 69 90, as claimed by Revenue. Further, it is also concluded that the appropriate classification for (iii) ‘Wireless IP Phones’ of ‘CISCO’ brand would be under CTH 8517 12 90 and not under CTH 8517 69 90, as claimed by Revenue.
The impugned order passed by the learned Commissioner (Appeals) cannot be sustained on merits. Accordingly, the impugned order is set aside - Appeal allowed.
-
2024 (4) TMI 41 - CESTAT MUMBAI
Warehousing of imported Goods without payment of duty - Compliance with the requirements of legal provisions or not - making an entry of the imported goods under Section 46 of the Customs Act, 1962 - clearance of goods for deposit, manufacturing in private bonded warehouse in terms of legal provisions under various Sections of Chapter IX ibid - eligibility for availing the benefit of Notification No. 50/2017-Customs dated 30.06.2017 on the impugned goods at the time of ex-bond clearance of final products manufactured in the private bonded warehouse - clearance of final products i.e., Boats, without paying the Customs duty on the raw materials used for making such boats - clearance of final products, without paying customs duty on the inputs, raw materials etc.
HELD THAT:- In order to determine the appropriate duties of customs payable on any imported goods, an importer is required to file a Bill of Entry (B/E) giving all required particulars of such imported goods for assessment to duty and depending upon whether such imported goods are required for clearance towards warehousing or home consumption, such of the legal provisions governing warehousing or customs clearance for home consumption would apply on such goods - as provided in Annexure-A & B to the SCN dated 14.01.2022, the imported raw materials have been brought into the country by the appellants by filing various Bills of Entry for warehousing and the same were assessed to duty by the Customs officers at the port of import i.e., Air Cargo Complex, Sahar and seaport of Nhava Sheva. Thus, the appellants had complied with the requirements of Section 46 ibid by filing an entry on importation of the goods into the country, and there is no case for any non-compliance in this regard.
It is also found that the finished goods manufactured out of such raw materials/ inputs imported as explained above, have also been removed from the private bonded warehouse by the appellants on payment of applicable import duties on the date of presentation of Bill of Entry in terms of Section 15(1)(b) ibid, by claiming exemption from basic customs duty under entry S. No. 558 of Notification No. 50/2017-Customs dated 30.06.2017 and upon payment of effective rate of IGST at 5% as per S. No. 250 at Schedule-I of Notification No. 1/2017-Integrated Tax (Rate) dated 28.06.2017. These clearances of final product i.e., Boats classifiable under CTI 8906 9000 from the appellants private bonded warehouse have been duly assessed and after payment of duty as determined by the Customs authorities of New Custom House, Mumbai, these goods have been allowed for home consumption clearance. It is also not the case of the Revenue, that there was any short payment of duty that is being demanded in respect of final products cleared from the appellants’ private bonded warehouse.
The appellants importer have duly complied with the requirements of legal provisions for making an entry of the imported goods under Section 46 of the Customs Act, 1962, and for clearance of goods under warehousing provisions contained under Chapter IX of the Customs Act, 1962.
The only situation under which the GST is payable in respect of warehoused goods, is provided under 8A of the Customs Tariff Act, 1975 to state that “where the goods deposited in a warehouse under the provisions of the Customs Act, 1962 (52 of 1962) are sold to any person before clearance for home consumption”. Thus, in respect of the imported raw materials which have been used in the manufacture of final products under a private bonded warehouse, as there is no clearance for home consumption by person by sale, we find that there is no situation arising for the levy of GST under the provisions of Section 8A ibid.
Payment of IGST on the imported raw materials/inputs taken into the private bonded warehouse of the appellants importer - HELD THAT:- In terms of Schedule-III entry at 8(a) to Section 7 of CGST Act, 2017 it has been specifically provided that the same shall not be treated as ‘supply’ of goods. Thus, no IGST would be leviable on such imported raw materials consumed in the manufacture of the final products.
It is found that it is only in respect of the final products manufactured from the private bonded warehouse, at the time of its clearance, the appellants are required to pay the applicable duties, under Section 68 ibid. In other words, appellants importer as a unit licensed under Sections 58 and 65 ibid was permitted to import capital goods, raw materials etc. and warehoused them without payment of duty. Manufacture and other operations in a bonded warehouse is only a duty deferment scheme and the applicable duties is payable at time of clearance of final products - The capital goods can be cleared for home consumption as per Section 68 read with Section 61 of the Customs Act on payment of applicable duty without interest. The capital goods can also be exported after use, without payment of duty as per Section 69 of the Customs Act. In the present case, the adjudged demands is not in relation to the demand of import duty in respect of final products cleared from the warehouse.
The imported raw materials/inputs used in the manufacture of final products under a Customs bonded warehouse in terms of Section 58 and 65 of the Customs Act, 1962 are not liable for payment of import duties at the time of clearance of such final products manufactured in the said customs bonded warehouse - the impugned order dated 10.01.2023 passed by the learned Commissioner of Customs (Import), Air Cargo Complex (ACC), Sahar, Mumbai by confirming the adjudged demands is not sustainable and thus, the same is set aside.
The appeals are allowed in favour of the appellants.
-
2024 (4) TMI 28 - CESTAT CHENNAI
Refund of Special Additional Duty of Customs paid - denial of refund on the ground that goods described in the Bills of Entry are not the goods which have been sold as per invoices produced by the appellant - HELD THAT:- The original authority has misconceived that since the goods have been imported by appellant’s Branch at Hyderabad, the goods have to travel upto Hyderabad and then be delivered to the customer at Sivakasi. A person who is in Mumbai, Hyderabad or any other place in India can import goods at Chennai port. It is not necessary that the goods have to come back to the said customer at Mumbai or Hyderabad and then be delivered to the customer to whom the goods are to be sold. The importer can make arrangements to deliver the goods to the customer from the port itself. This being so, the assumption made by the original authority that it is impossible for the goods to travel upto Hyderabad and then be delivered to the buyer at Sivakasi, is highly erroneous. The invoices are raised by the importer appellant which is the Hyderabad Branch. The rejection of refund claims is without any factual basis.
The impugned order to the extent of rejecting the refund claims in respect of two Bills of Entry and the invoice Nos.157 & 158/2013 requires to be set aside - Appeal allowed.
-
2024 (4) TMI 14 - CESTAT BANGALORE
Benefit of exemption under Sl.No.A204 of the N/N. 72/2005-Cus. dated 22.07.2005 - import of Porcelain Panels, size 900mm X 1800mm X 5.5mm - classifiable under Chapter Heading 6907 or not - HELD THAT:- As seen from the catalogue and the literature placed by the appellant before the authorities concerned, the item porcelain panel is nothing but ceramic tile and therefore, from the Chapter Headings, it is very clear that the goods are rightly classified under Chapter Heading 6907. The Explanatory Notes for Chapter Heading 6907 states “This heading covers ceramic flags and tiles including quarry tiles, commonly used for paving or facing wall, hearths etc.” The invoice No.EXP1599-3 dated 29.08.2012 clearly mentions the items as ceramic tiles filed along with one of the Bill of Entry.
The goods are ceramic tiles as per the invoices and catalogues filed by the appellant; therefore, the benefit of the exemption Notification for ceramic tiles on the ground that they are slabs/panels cannot be accepted. Accordingly, the good are classifiable under Chapter Heading 6907 and are eligible for the benefit of Notification No. 72/2005 dated 22.07.2005.
All the appeals are allowed.
-
2024 (3) TMI 1303 - SC ORDER
Classification of imported goods - Reformate - whether the goods to be classified under CTH 2710 12 19 or under CTH 2707 50 00? - Tribunal held that Reformate would merit classification under CTH 2707 50 00 - HELD THAT:- We are not inclined to interfere with the impugned judgment and order passed by the Customs, Excise & Service Tax Appellate Tribunal.
Civil Appeal is, accordingly, dismissed.
-
2024 (3) TMI 1302 - BOMBAY HIGH COURT
Suspension of operations of handling the cargo of third parties - Non-issuance of a show cause notice - Validity Of order passed by the Commissioner of Customs (G) - failure to comply with the provisions of Regulations 5 & 10(1)(m) of the SCMTR, 2018 and Section 33, 34, 39, 40 & 41 of the Customs Act, 1962 - confiscation of goods - penalty - HELD THAT:- As the petitioners are handling the cargo of third parties and if the order-in-original is not suspended, it would be a serious and an irreparable prejudice not only to the petitioners but also to third parties with whom the petitioners have contracts to handle their cargo. Thus, in our opinion, it is in the interest of justice that the proceedings are remanded to the Commissioner of Customs for a fresh order to be passed after an opportunity of hearing is granted to the petitioners after issuance of a show cause notice, so that the petitioners are made aware in regard to the allegations intended to be made against the petitioners for such action to be resorted and on which the petitioners can be heard by the Adjudicating Officer.
Thus, for such course of action to be adopted, the impugned order dated 14 March 2024 would be required to be quashed and set aside, as also the consequences emanating from the said order namely the Public Notice dated 20 March 2024 would also be required to be not acted upon. Ordered accordingly.
We, accordingly, dispose of this petition in terms of our aforesaid observations.
-
2024 (3) TMI 1301 - TELANGANA HIGH COURT
Levy and collection of Cost recovery charges - Validity Of Notification No.26/2009 issued by Central Board of Excise and Customs - Duties, functions and obligations of custodian appointed under section 45 of the Customs Act, 1962 - Regulation 5(2) of the Handling of Cargo in Customs Areas Regulations, 2009 - Regulation ultra vires to section 157 and 158 of the Customs Act, 1962 - HELD THAT:- It is submitted that even if the same are treated to be a fee, there is no justification for levy of fees as no service is being rendered to the Company. In the absence of any element of quid pro quo, it is urged that the decisions of Bombay and Delhi High Courts in Mumbai International Airport Private Limited [2014 (10) TMI 508 - BOMBAY HIGH COURT] and Allied ICD Services Limited [2018 (8) TMI 1610 - DELHI HIGH COURT] are distinguishable and the learned Single Judge of this Court has rightly held that the 2009 Regulations are ultra vires the Customs Act, 1962. In support of the aforesaid submissions, reliance has been placed on the decisions of the Supreme Court in Government of Maharashtra vs. Deokar’s Distillery [2003 (3) TMI 727 - SUPREME COURT] and Gupta Modern Breweries vs. State of Jammu and Kashmir [2007 (4) TMI 684 - SUPREME COURT].
From a perusal of Section 157 of the Customs Act, it is evident that Section 157 does not enumerate any specific provision under which cost recovery charges i.e., the amount of salary payable to the officials of the Customs Department, who are deployed at the Airport who perform their statutory duties, can be recovered. The 2009 Regulations have been framed in exercise of the powers conferred under Section 141 and Section 157 of the Customs Act. From a close scrutiny of the aforesaid provisions of Sections 141 and 157, it is evident that there is no express statutory provision conferring authority on the appellants to levy cost recovery charges. In the absence of any special authorization to levy cost recovery charges, appellants have no authority to impose cost recovery charges by means of a Regulation. The inevitable conclusion is that the 2009 Regulations are ultra vires the Customs Act, 1962.
Therefore, the officers of the Customs Department, who were employed at the Airport between the years 2008 and 2013, were deployed to perform their statutory duties. The levy of cost recovery charges, which is in fact salaries payable to the customs staff deployed at the Airport is in the nature of administrative charges and is a tax. It cannot be exacted from the respondent without any statutory provision. Therefore, the same is also violative of Article 265 of the Constitution of India. Even assuming that the said levy to be a fee, the same cannot be recovered from the respondent as no services are provided to it by deployment of additional staff at the Airport between the years 2008 and 2013.
Contention that the Company at the time of application seeking appointment as Custodian has furnished an undertaking that it shall abide by the 2009 Regulations is concerned, suffice it to say that the Company subsequently on 06.05.2007 and 22.11.2007 had submitted applications seeking to waive the condition Nos.10 to 13 of Circular No.34/2002. Therefore, the undertaking furnished by the Company does not bind it in the facts of the case.
Thus, we agree with the conclusion of the learned Single Judge that the impugned 2009 Regulations are ultra vires the Customs Act.
In the result, the Appeal fails and the same is hereby dismissed.
-
2024 (3) TMI 1300 - GUJARAT HIGH COURT
Levying Container Storage Charges - ground rent - Storage of confiscated containers to treated as Goods or not - declaration of Custodian at Kandala Port Trust issued from the office of the Commissioner of Customs, the Custom House, Kandala - Section 45(1) of the Customs Act, 1962 - HELD THAT:- The contention of the learned counsel for the petitioner that the Kandala Port Trust could not have charged ground rent from the petitioner as the containers could not have been confiscated by the Customs authorities, as they did not fall within the meaning of ‘goods’, is found to be misconceived. The reference to the decision of the Apex Court in Chairman, Board of Trustees, Cochin Port Trust [2020 (8) TMI 300 - SUPREME COURT] is found to be misplaced.
No ground rent can be levied on the petitioner shipping agent, once the Kandala Port Trust became the custodian of the goods with the confiscation by the Customs department. There are inherent fallacy in the arguments of the learned counsel for the petitioner, inasmuch as, the said notification only decides the liability of the Kandala Port Trust for being custodian of the Custom department and Clause 18 of the said notification can only be interpreted to mean that the Kandala Port Trust would not charge any rent/ demurrage on the goods/containers detained from the Customs department.
There are no error in the order passed by the learned single Judge in holding that the petitioner has failed to make out a case that there was an error on the part of the Kandala Port Trust in levying container storage charges from the petitioner.
Appeal disposed off.
-
2024 (3) TMI 1299 - CESTAT CHENNAI
Revocation of CHA License - Customs Broker resorted to unprofessional methods while clearing the goods imported vide Bill of Entry - Fabrication of redemption fine and penalty in the order in original - time limit stipulated in Regulation 20 of CBLR, 2013 - whether the Order directing for continuation of suspension issued by the Department dated 20.12.2013 is legal and proper - HELD THAT:- The prohibitary order was issued on 05.06.2013. If such date is considered as the date on which the Department had come to know of the incident, the Show Cause Notice ought to have been issued on or before 05.12.2013. In the present case, the Show Cause Notice is issued only on 20.12.2013 which is beyond the period of 90 days prescribed in Regulation 20 of CBLR, 2013. Further, it has to be noted that though an inquiry officer was appointed by the Department, no inquiry report (offence report) was submitted by the Department. The Hon’ble Jurisdictional High Court in the case of Sabin Logistics Pvt. Ltd. [2019 (4) TMI 1713 - MADRAS HIGH COURT] had held that the compliance of the time limit as prescribed in the Regulation is mandatory. This Tribunal in the case of M/s. Trade Wings Logistics India Pvt. Ltd. [2023 (7) TMI 892 - CESTAT CHENNAI] had occasion to consider a similar issue and held that when the Department has not complied with the time limit, the order issued for revocation of licence or the order issued for continuation of the suspension licence cannot sustain.
Thus, we are of considered opinion that the Order issued by the Department directing for continuation of suspension of the licence cannot sustain and requires to be set aside.
In the result, the impugned order is set aside. The appeal is allowed with consequential relief, if any, as per law.
-
2024 (3) TMI 1298 - CESTAT CHENNAI
Exemption from Basic Customs Duty - Import of Lithium-Ion Batteries falling under Customs Tariff Heading 85076000 - Time limitation for submission of Country of Origin certificate - the goods are originating from the Republic of Korea - HELD THAT:- The Commissioner (Appeals) ought not to have rejected the appeals on the ground of being time barred. There is no requirement to file a petition for condonation of delay as the said period during the Pandemic has been excluded by the Hon’ble Apex Court in IN RE: COGNIZANCE FOR EXTENSION OF LIMITATION [2022 (1) TMI 385 - SC ORDER]. The rejection of appeals as time barred cannot be sustained and requires to be set aside. The matter is remanded to the Commissioner (Appeals) for reconsideration of the issue of benefit of exemption notification.
In such reconsideration of the issue, the Commissioner (Appeals) shall look into the Country of Origin certificate issued retrospectively as per the Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of the Republic of India and the Republic of Korea) Rules, 2009 to ascertain the eligibility of exemption. The decision of Tribunal in the case of THE COMMISSIONER OF CUSTOMS VERSUS M/S. KOMOS AUTOMOTIVE INDIA PVT. LTD. [2023 (9) TMI 1446 - CESTAT CHENNAI] on similar issue shall also be looked into by the appellate authority.
The impugned orders are set aside - The matter is remanded to the Commissioner (Appeals) who shall dispose of the case within a period of two months from the date of receipt of this order - Appeal allowed by way of remand.
-
2024 (3) TMI 1297 - CESTAT BANGALORE
Revocation of Licenced Customs Broker Licence - violation of Regulations 10(d), 10(e) and 10(i) - forfeiture of security deposit - Penalty - Appraiser at the CFS Chennai demanding and accepting undue advantage from the Custom House Agents (CHA) for issuing Let Export Order / out of charge order on the consignments and registration of bills pertaining to import/export - HELD THAT:- The entire proceedings are based on CBI report, which in turn is based on the slips and vouchers recovered from the customs officials, the appellant and various statements of the employees. These are only allegations/charges arrived at a preliminary stage which is yet to be corroborated with the evidences and to be finalised by the CBI. Moreover, based on the same set of facts, the Customs Brokers are penalised differently either by imposing only penalty or by revocation of license along with imposition of penalty as is the case of the present appellant.
Based on the facts and allegations levelled against the appellant and the facts placed on record do not in any way prove the contravention of clause 10(d) and (e) of the Regulations and to invoke clause 10(i), the allegations/charges are yet to be proved by the competent court. Moreover, the decisions relied upon by the appellant clearly observed that the appellant cannot be penalised for the actions of the employee when there is no proof on record to establish that the conduct of the employee was authorised by the appellant.
Thus, the entire proceedings being based on CBI report which is pending adjudication are pre-mature and without any basis. We set aside the impugned order and allow the appeal.
-
2024 (3) TMI 1296 - CESTAT HYDERABAD
Valuation - export duty - Whether the Appellant/Assessee is liable to pay customs duty on the FOB value, on export of iron ore fines considering the same as cum-duty value or otherwise - HELD THAT:- We find that the issue is no longer res integra as has been decided in catena of rulings against the Appellant/Assessee holding that Cum Duty Value cannot be used for arriving at the value for levy of export duty. In the following rulings of this Tribunal, this view has been taken in Sesa Goa Ltd vs CCE,C & ST,[2014 (4) TMI 658 - CESTAT KOLKATA] and Essel Mining & Industries Vs CCE, [2017 (4) TMI 87 - CESTAT KOLKATA].
Thus, we dismiss the Appeals and uphold the Impugned Orders.
-
2024 (3) TMI 1295 - CESTAT HYDERABAD
Value addition - Duty-free import of gold - Replenishment of gold under the ‘replenishment scheme’ from DIL against export of gold jewellery - Not fulfilled the mandatory requirements - balance quantity of gold supplied - duty demand - confiscation - Penalty u/s 114A - limitation for adjudication - Violation of the conditions of Notification No. 57/2000-Cus.
i) Whether or not the subject ‘kadas’ were manufactured by a ‘fully mechanized’ process as declared by BL/JR in the shipping bills.
ii) Whether or not the claim made by BL/JR that the value addition was “2.05%” of the export FOB value, is correct?
HELD THAT:- Gold has been supplied by DIL by way of replenishment and there is no allegation that matching quantum of gold has not been exported as required under Notification No. 57/2000-Cus. In the said Notification, in the second proviso, it clearly provides that Nominated Agency supplying gold to the exporter is liable only for difference (shortage) between the quantity issued and that contained in the exported jewellery or articles. We further find that the value addition norm was required to be checked by the proper officer of customs on presentation of goods with the export documents. Admittedly, all the shipping bills along with the export invoices were approved by the proper officer of customs on being satisfied as to the declarations and requirements. Thus, we find that no case of violation of the conditions of Notification No. 57/2000-Cus is made out in the facts and circumstances. Thus, we hold that the Appellant – DIL has not violated the provisions of Customs Act read with Notification No. 57/2000-Cus.
From the facts on record and the evidence recorded, it is evident that the jewellery in question which have been exported, was manufactured by the said job worker by fully mechanised process. The Govt. approved jewellery valuers, who are experts, have also certified so. Further, the said valuers have not stood by their statements recorded during investigation. The Chartered Engineer has also certified the process as fully mechanized. Therefore, the value addition here would be 2% and not 3.5% as held in OIO.
Value addition - It is obvious that the interpretation of DGFT Authority would prevail over Customs Authority, which has also been admitted by DGEP in their circular (quoted supra). Therefore, if that norm is followed instead of the calculation method adopted by the Revenue, the requirement of Notification No. 57/2000 is met, in as much as, the conditions for duty-free imports stand fulfilled and therefore, there is no short levy.
Evidential value of email clarification - It is also noticed that this mail has come in response to DIL’s letter dt.09.10.2020. Since it is an official mail, it cannot be held as having no authority to clarify as indicated in the said mail. If Revenue had any doubt about genuineness of this mail, they could have cross-checked from the DGFT as regard bonafide of this mail. It is obvious that the original Circular dt.27.09.2019 also, in Para 3, has clarified that for the purpose of value addition, inputs in ‘B’ in Para 4.38 means ‘the duty-free’ (either on advance or replenishment basis). Therefore, it would be obvious that the term ‘dutyfree’ used here in conjunction with either on advance or replenishment basis, would obviously mean imported inputs or in other words, what has been clarified in email is inputs imported duty free. Therefore, the objection taken by the Revenue on this ground does not hold any substance.
Further, we have held that the process of manufacture is fully mechanised, we find that the wastage allowable was 0.9%. Further, the required value addition is 2% as per the table in Para 4.61 & 4.62 in the Handbook of procedures. Thus, we find that the whole allegation by revenue of not achieving minimum value addition is misconceived and bad.
There is no allegation in the SCN that the customs authorities – proper officer did not perform their duty diligently or have abetted with the exporter. Further, all duly endorsed documents were submitted by DIL to jurisdictional Customs officer for final assessment and closure of the bond and the said bonds were closed without raising any doubt or query based on endorsement of proper officer of customs, at the time of export of gold jewellery. Thus, the whole allegation is not substantiated and has got no legs to stand.
We further find that there is also no allegation that the Appellant have exported gold jewellery using less quantum of gold, than declared or made by some other metal other than gold. Also, there is no allegation regarding purity of gold as declared. Thus, we hold that the provisions of section 113(i) for confiscation are not attracted, there being no case of any misdeclaration.
DIL as the Nominated agency - We hold that there is no case of any violation against DIL under the Customs act, read with the notification. We further take notice of the fact that the bonds given by the Nominated agency – DIL to the customs, have been duly discharged or closed by the proper officer after due verification of relevant documents under the scheme.
Jewellery valuer - We find that, the allegation against him would also not stand. It is evident that this Appellant has valued the gold jewellery under export, in the export shed in presence of the Customs officials. He has certified certain other parameters including weight and purity but that does not make him accomplice. No case of any suppression or collusion in the valuation report is made out. In this view of the matter, we allow the appeals of the jewellery valuer and set aside the penalties imposed on him.
Consequently, we hold that no penalties are imposable on any of the parties/Appellants. Accordingly, all the penalties imposed on all the Appellants are set aside.
Limitation for adjudication - The Revenue has however put on record an Order dt.21.08.2019, whereby, in the case of SCN dt.31.08.2018, the approval for extension of one year as per first proviso to Sec 28(9) of Customs Act was recorded by the competent authority. Further produced a notification viz., 06/2019-CUS dt.27.02.2019, under sub-sec (8) of Sec 28 of Customs Act, whereby in respect of SCN dt.26.09.2018 of DIL was extended by further period of one year. The Appellants have relied on the judgment of Gautam Spinners vs CC (Import) [2023 (386) ELT 62 (Del)] to substantiate their claim that regardless of causative factors, the notice needs to be adjudicated within the statutory period. Be the case as may be, since the entire issue has been decided on merit itself, we keep the issue of limitation open without expressing any view on this aspect.
Further, as we have allowed the appeals on merits, we also leave the question of limitation open.
All appeals are allowed with consequential benefits, including entitlement to receive the balance quantity of gold, which has not been released by the Nominated agency – DIL to the Appellant/exporter M/s BL/JR under the replenishment scheme.
-
2024 (3) TMI 1253 - BOMBAY HIGH COURT
Levy of stamp duty on ‘Bill of Entry’ (BoE) and on Delivery Orders (DO) - goods imported in Maharashtra - seek refund paid on stamp duty - Whether the State of Maharashtra has the legislative competence to levy, impose and collect stamp duty on a Delivery Order, an ‘instrument’ defined in Section 2(l) of the Maharashtra Stamp Act, 1958, chargeable with duty as mentioned in Article 29 of the First Schedule in the Maharashtra Stamp Act, 1958? - Entries 41 and 83 of List I of Schedule VII of the Constitution of India - ultra vires Article 246(1), 286(1)(b) and 286(2) - HELD THAT:- A plain reading of the taxing provision of the MSA suggests that a DO mentioned in Article 29 is indeed an instrument. It is not excluded from the definition of instrument. It creates an entitlement in the consignee, i.e., the Petitioners herein or any person named by them in the DO, to take delivery of the goods lying in any dock or port, in any warehouse in which the goods are stored, or deposited on rent or hire or upon any wharf etc.
The definition of ‘instrument’ includes every document by which any right or liability is, or purports to be created, transferred, limited, extended, extinguished, or recorded. Certain documents have been specifically excluded from the definition. A DO is not one of them.
Once the goods reach the destination port, they are unloaded and stored in a warehouse or storage as directed by transacting parties. In the meantime, the consignee or his agent presents a document called the BoE also containing a description of the goods matching that contained in the BoL and other details to the customs authorities. It is on the basis of the BoE that customs duty payable is computed and paid by the consignee. Upon evidence of payment of customs duty, and also its own charges, the shipper then issues the DO saying that the custodian of the goods may hand the goods over to the consignee (as there is no pending duty, claim or demand). Stamp duty is then paid on the DO and upon verification of payment of the same, the custodian releases the custody of the goods.
Whether the DO is an integral part of the chain of events in the course of import of goods or is independent of the import albeit incidental thereto - If it is the latter, and not an integral part of the import, the State is well within its powers to levy stamp duty on it as per the pith and substance rule since the primary object and the essential purpose of Article 29 read with Section 2(l) of the MSA is then identified as distinct and not an integral part of an import but more as consequence of import.
The BoE is presented for computation of the customs duty. Once the customs duty is paid, the import process so far as the customs authorities and the Customs Act is concerned ends. The DO is then issued by the shipper upon proof of payment of customs duty and its own charges. The DO does not form part of the chain of the import process and the taxing event occurs beyond the course of import. As Dr Saraf puts it, if a consignee can take delivery without a DO, there would be no question of a stamp duty impost. There is thus, no overlap in the legislative field and, the State and the Centre are both well within their own occupied area of Legislation.
The DO in question in this group of cases only springs into being when that frontier has ended, i.e., after the process of assessment and recovery of customs duty is complete. The BoL, a document of title, originates when goods are laden on the vessel. It is the first in point of time. The BoE, as the Gujarat High Court judgments point out, is for the purposes of customs duty assessment. This is second in point of time. The DO comes into existence third in time sequence, after the customs duty, dues, freight, etc., are paid and the goods are lien-free, i.e., available for delivery. The ‘customs barrier’ is, therefore, not a physical ‘barrier’ per se, but speaks of a point in time after the role of customs has ended.
Thus, a parallel can be drawn between the taxing power of the State in respect of levy of entry tax in the aforesaid decision and levy of stamp duty on a DO in the present case. Article 286(1)(b) of the Constitution restricts the power of the State to impose tax on the supply of goods imported into the country. The imposition of stamp duty on a DO in no manner encroaches upon the parliamentary legislature in Entry 83 of List I of the VIIth Schedule.
Shipper’s lien on the goods - The DO in the present circumstances has nothing to do with the customs duty nor the clearance by the customs authority for domestic consumption. Dr Saraf candidly says that if the Petitioners are able to bye-pass the requirement of a DO, the State will not have any claim of stamp in such a situation. But the moment there is a DO, the same will not be valid or accepted by the custodian without proof of payment of the stamp duty.
DO is not a document of title under Article 29 of the MSA and hence, it is not an ‘instrument’ - It is a DO which entitles the person named therein to take delivery of the goods after discharging the dues of a shipper. It is only after the shipper’s charges are cleared that his lien on the goods is extinguished. A right to possession of the goods is distinct from ownership of the goods. Although title to goods includes ownership and possession, the former may exist without the latter. Ownership denotes de jure possession, but another person may be in de facto possession of the goods. The distinction between title and possession is self-evident. A BoL may, for instance, be transacted in a sale in the high sea. Title would pass. But the new/substituted consignee would not get physical possession of the goods sold, the high seas’ sale notwithstanding, until the goods were cleared through customs on arrival at the destination port. That possession may happen with or without a DO; and it is for each state government to decide whether or not to levy stamp duty on the DO.
Consequently, the DO is not a BoL, nor a BoE, and it is not covered by any exclusion of the BoL or the BoE. As in the present case, even if we were to accept the contention of the Petitioners that the BoL constitutes title to the goods, without a DO, the owner or the consignee may not have possession of the goods without payment of the carrier’s charges. Only upon release of the shipper’s lien is the consignee entitled to delivery/possession of the goods. Thus, it is not necessary for the DO to be a document of title to fall within the purview of the definition of ‘instrument’.
Once we have held that the State has not encroached upon the legislative field of the Union, merely because the amount of stamp duty is computed on the valuation of the goods does not preclude a DO from being an ‘instrument’ chargeable to stamp duty by the State.
Thus, we hold that the action of the State of Maharashtra in levying stamp duty on ‘DO’ as provided in Article 29 of Schedule I of the MSA is well within the legislative competence of the State and does not intrude upon the legislative domain of the Parliament as reserved in Entries 41 and 83 of List I of Schedule VII of the Constitution of India and is not ultra vires Article 246(1), 286(1)(b) and 286(2) of the Constitution of India.
The alternative prayer of the Petitioners to read down Article 29 of Schedule I of the Stamp Act of 1958 to not apply to a DO issued in respect of goods imported in Maharashtra is untenable. As held by the apex court in the matter of The Authorised officer, Central Bank of India vs Shanmugavelu [2024 (2) TMI 291 - SUPREME COURT], the rule of reading down is to be used for a limited purpose of making a particular provision workable and to bring it in harmony with other provisions of the statute. It is to be used keeping in view the scheme of the statute and to fulfil its purpose. We have already held that the DO is not an extension of a BoL and both are mutually exclusive documents. Thus, there is no statutory conflict and the requirement of reading down the provision does not arise.
Since we hold as such, the further question of granting refund of payments made by the Petitioners towards stamp duty is redundant.
All interim applications pending therein also stand disposed.
-
2024 (3) TMI 1252 - DELHI HIGH COURT
Seeking direction to sanction and grant refund of excess duty - imports networking equipment - Non speaking order - HELD THAT:- Learned counsel for petitioner submits that the order in appeal was passed on 31.10.2022 and till date the adjudicating authority has not disposed of the proceedings. He further submits that the impugned order which records that the Notification dated 10.12.2019 was made effective from 01.01.2020 seems to suggest that the bill of entry lodged by the petitioner was filed after the Notification came into force. He submits that bill of entry was filed on 16.11.2019 before the Notification admittedly came into force on 01.01.2020.
Thus, the petition is disposed of directing the adjudicating authority to dispose of the proceedings expeditiously within a period of six weeks from today after giving an opportunity of personal hearing to the petitioner.
The petition is disposed of.
............
|
