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Customs - Case Laws
Showing 61 to 80 of 181 Records
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2016 (9) TMI 930
Enhancement of assessable value of export - Fe percentage content in the ore - Fe content as per invoice - Fe content as per Customs Laboratory Report - rule 6 of CVR - CBEC Board issued Circular no. 12/2014 Cus-dated 17.11.2014 in respect of valuation of Iron Ore - Held that: - the test reports of Custom House laboratory have been issued around a month after filing of the shipping bills. It is been consistently held that time factor is important in testing such samples, since there would result increase in Iron content due to evaporation of moisture. The decision in the case Steer Overseas Pvt. Ltd Vs Commissioner Cus & CE, Vizag [2009 (4) TMI 369 - CESTAT, BANGALORE] have been followed.
It is also noted that the declared contractual values of such Iron Ore exports are accepted in other ports like Kolkatta, Paradeep etc., as per the documents submitted by the appellant.
The variations in Fe content were very minor, within tolerance limits, did not impinge upon the declared values since the invoice amount in each case was realized as per the BRCs - the loading of assessable value found to be arbitrary and without any basis.
Appeal allowed - decided in favor of appellant.
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2016 (9) TMI 929
Imposition of redemption fine - provisional release of goods on payment of full differential duty and furnishing Bank Guarantee of ₹ 65 lakhs, besides executing a Bond of ₹ 33 crores - Barge - Section129E of the Customs Act, 1962 - relief sought under Section 35F - The asset has been confiscated and has been offered for redemption on payment of redemption fine. The same has been released on execution of bond and a bank guarantee. In these circumstances can the appellant continue to use the provisionally released asset without executing option of redemption?
Held that: - Ideally the offer of redemption should be valid for a limited period and cannot be enjoyed for unlimited period. After confiscation the ship is a property of the state. Before it was confiscated it was released to the appellant provisionally. Till confiscation the applicants could have enjoyed the benefits of the seized property provisionally released to them. After confiscation the property of the confiscated goods vests in the state. The applicants wish to enjoy the benefit without fulfilling their obligation of paying redemption fine. Therefore more stringent conditions need to be put for allowing further use of the asset.
The applicants to execute bank guarantee of ₹ 2,85,00,000/- in addition to existing bank guarantee. On furnishing of such guarantee the respondents will permit the applicant’s to sail out of India the barge subject to condition that the applicant shall file an undertaking before authority stating the purpose of taking out the vessel and to bring back within a period of four months from the date of release of the vessel.
Petition disposed off - decided against petitioner.
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2016 (9) TMI 928
Jurisdiction to issue show cause notice - proper officer - confiscation under Section 11(l)(m) & (d) of the Customs Act - imposition of penalties - bank guarantee of ₹ 2 lakhs submitted at the time of provisional release, appropriated towards reduction fine of equal amount - mis-declaration of goods - lighting fixture - Section 28(1)(b) read with Section 124 of the Customs Act, 1962 - Held that: - the decision in the case Mangali Impex Ltd. Vs. Union of India & others [2016 (5) TMI 225 - DELHI HIGH COURT] is relied upon.
The show cause notice is issued prior to the amendment of Act of 2011, with effect from 08.04.2011. The show cause notice issued by the Joint Director-DRI is without jurisdiction - appeal allowed - decided in favor of appellant.
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2016 (9) TMI 927
Restoration of CHA license revoked - forefeiture of security deposit - regulation 22(7) and 20(1) of then CHLR 2004( now Regulations 20(7) and 18 of CBLR, 2013) - drawback - mis-declaration - classification - Customs Tariff Item No. 6109.9090 - drawback @ 7.8% of the FOB value - Customs Tariff item No. 6109.1000 - drawback @ 6.7% of the FOB value - Held that: - Appellant, being CHA, acted as a CHA of the exporter on the basis of documents submitted to him. As per the document, description declared was not incorrect i.e. readymade garment /T shirt. Further, the appellant were paid ₹ 500/- per document for their clearance in respect of exports of the impugned goods, there is nothing on record to show that the appellant have benefited extraneously over and above the actual CHA fees i.e. ₹ 500/- per document. In view of this position also there is no doubt that appellant CHA was nowhere involved in any mis-declaration of the goods made by the exporter - CHA not responsible for mis-decaration.
Authorisation letter - Held that: - once the exporter gave the authority letter and thereafter the business is continuing, the same authority letter will be sufficient for carrying out the business in future also. Therefore, in each and every consignment, or each and every shipping bill separate authorization is not required. Once the authorization was given by the exporter it is sufficient compliance of regulation 13(a) of CHARL, 2004. when the shipping bill was filed by the CHA and it has been accepted by the exporter, this fact itself shows that appellant has been duly authorized by the exporter for carrying out clearance work of exports consignments.
It is general practice in the CHA business that CHA work is brought by the various intermediary but ultimately it is CHA and importer or exporter which are under contract regarding the CHA clearance as well as payment term. Therefore, merely because some shipping line brought client to the appellant does not lead to any conclusion that there was no relation between appellant and exporter.
Advise to client - Held that: - Even after detection of different nature of the goods, the description of the goods remained same. Therefore there was no occasion for CHA to advise client.
Performance of CHA - delay and deficiency - Regulation 13(n) - Held that: - the appellant have performed their clearance work of export consignment in usual course and nothing brought on record that appellant as CHA have delayed in the clearance work or there is any deficiency in the performance of clearance work on the part of the appellant.
Appeal allowed - decided in favor of appellant.
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2016 (9) TMI 881
Interest on refund under the provisions of Section 27A of the Customs Act, 1962 - import of spares and consumables for carrying out drilling operations - Notification No.21/2002-Cus dated 1st March, 2002 - exemption of goods required in connection with petroleum operations undertaken under petroleum exploration licenses - sub-contractor - Essentiality Certificate - import without claiming benefit and on payment of duty - claim for refund - is applicant entitled to get interest on delayed refund? - Held that: - once an application for refund has been made and the same is granted within a period of three months from the date of receipt of the application, then there would be no liability to pay interest to the applicant. However, if the refund is granted beyond the period of three months from the date of receipt of the application, then, on the amount of refund granted, interest would also be payable from the date immediately after expiry of three months from the date of receipt of such application, till the date of refund. the decision in the case Ranbaxy Laboratories Ltd Vs. Union of India [2011 (10) TMI 16 - Supreme Court of India] would apply.
The Petitioner had not complied with the conditions of the Essentiality Certificate. It therefore held that the Essentiality Certificate could not be taken to be the basis of the refund and accordingly rejected the refund application of the Petitioner. This order dated 13th December, 2011 was thereafter subjected to an appeal and as well as further proceedings , which finally culminated in a refund being granted to the Petitioner on 23rd June, 2014 in the sum of ₹ 1,89,15,549/-. As no interest was granted on this refund, the Petitioner challenged the said order - Held that: - the statutory provisions are clear that where there is a delay in the grant of refund, then interest must follow. It is only the calculation thereof which would be determined by the Authority - applicant entitled to interest.
Necessary action to be taken against the Secretary, Ministry of Finance (Department of Revenue), Government of India and the Chairman, Central Board of Excise and Customs, New Delhi. It is only they who would possibly realise that the object and purpose is to take expeditious action on refund applications so that revenue loss is avoided in payment of statutory interest. The intent is to discourage the tendency of not taking prompt action on these applications, thereby defeating all policies aimed at creating a business friendly atmosphere. They must also realise that litigation in Court on this score results in precious time and money being wasted.
Applicant entitled to interest on delayed refund - matter on remand to Refunding Authority for the limited purpose of calculating and paying interest - petition disposed off - decided in favor of petitioner.
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2016 (9) TMI 880
Rejection of settlement applications - proper disclosures not made amounting to non-cooperation - duty and interest under clause (c) to the 1st proviso to section 127B(1) - settlement of cases under Chapter XIV-A - Held that: - The settlement machinery was meant for providing a chance to a tax-evader who wants to turn over a new leaf as recommended by the Direct Taxes Inquiry Committee.
The majority view of the Settlement Commission was in grave error in coming to the conclusion that the Settlement Applications filed by the Petitioners were liable for rejection on the ground of non co-operation in the proceedings and non payment of any admitted duty and interest as required under Section 127B. The Petitioners had explained that they had not made any additional payment of duty because in the past they had deposited the amount of duty which was far in excess of what was demanded in the SCN. This explanation was accepted by the Settlement Commission, and it was only thereafter that the case was allowed to be proceeded with - It was not correct on the part of the of the Settlement Commission (the majority view) to reject the Settlement Applications of the Petitioners on the ground of non payment of any admitted duty and interest as required under Section 127B.
Classification of goods - reclassification of the fitments to the Pontoon, alongwith the Pontoon - grounds of rejection - Held that: - In view of the fact that the Settlement Commission itself had allowed the Settlement Applications of the Petitioners to be proceeded with under section 127C would only mean that at the threshold itself, the Commission was satisfied that the Settlement Applications filed by the Petitioners was not made for the interpretation of the classification of the goods under the Customs Tariff Act, 1975. This apart, it was also the case of the Petitioners that they are not disputing any classification as proposed by the Revenue in the SCN. - the Settlement Applications filed by the Petitioners could not have been rejected on this ground, as well.
Matter remanded to the Settlement Commission to decide the Settlement Applications filed by the Petitioners on merits and in accordance with law and uninfluenced by any views of the majority or minority - petition disposed off - decided in favor of petitioner.
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2016 (9) TMI 879
Redemption of gold seized on payment of redemption fine - Section 125 of the Customs Act 1962 - provisional release of goods under Section 111(d) of the Customs Act, 1962 - prohibited goods - discretionery power of competent authority in taking a decision - whether the competent authority correct in denying the release of goods, thereby imposing absolute confiscation in exercise of its discretionery power?
Held that: - The power conferred on the authority without any guidelines may likely to be abused or arbitrarily exercised and in such circumstances, the guidance and the control of exercise of such power has to be gathered from the object of conferment of such power. Non-consideration or non-application of mind to the relevant factors, renders exercise of discretion manifestly erroneous and it cause for judicial interference. The case of Global Energy Limited and another v. Central Electricity Regulatory Commission [2009 (5) TMI 904 - SUPREME COURT] referred where it was held that the exercise of discretion has to be in conformity with the purpose for which, it is conferred, object sought to be achieved and reasons to be recorded.
When discretion is exercised under Section 125 and if any challenge is made under Article 226 of the Constitution of India, the twin test, to be satisfied is "relevance and reason". In the light of the judgments of the Hon'ble Apex Court and applying the same to the facts of this case and testing the discretion exercised by the authority, on both subjective and objective satisfaction, as to why, the goods seized, cannot be released, when smuggling is alleged and on the materials on record, it is held that the discretion exercised by the competent authority, to deny release, is in accordance with law.
Decided in favor of revenue.
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2016 (9) TMI 878
Refund claims under Section 27 of Customs Act, 1962 - petitioner filing return admitting liability at 20 percent, assessment finalized by competent authority - notification no. 103/2004-Customs dated 30.09.2004 of Union of India reduced custom duty to 15 percent w.e.f. 01.10.2004 - whether authority considering refund claim can sit in appeal over an assessment made by a competent officer for the purpose of refund' when such assessment is not modified by an order of competent authority in appropriate proceeding? - Held that: - the decision in the case of Priya Blue Industries Ltd. Vs Commissioner of Customs (Preventive) [2004 (9) TMI 105 - SUPREME COURT OF INDIA] would apply.
Since assessment has not been modified in accordance with procedure prescribed in statute, therefore, in the garb of refund, officer concerned cannot take a different view so as to refund an amount paid as per assessment order. Hence so long as assessment as such continue, no refund is admissible to petitioner.
The petitioner may utilize alternative legal remedy, if available - petition dismissed - decided against petitioner.
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2016 (9) TMI 877
Constitutional validity of Sections 27A and 28AA of the Customs Act 1962 - notifications no. 75/2003~Cus(NT) dated 12.09.2003, 18/2011-Cus(NT) dated 01.03.2011 (w. e. f. 01.04.2011) and 33/2016-Cus(NT) dated 01.03.2016 (w. e. f. 01.04.2016) - whether the Respondent is justified in adopting a discriminatory approach in the matter of interest, which is compensatory in character by awarding an Assessee in effect interest at only 6% per annum on the delayed refunds while charging an Assessee interest at present at 15% per annum on late payment of duty? - maintainability - SCN dated 16th April 2014 - Held that: - there is no stay of the adjudication of the SCN dated 16th April 2014, which will proceed in accordance with law.
The final order passed in the adjudication proceedings, limited to the extent of the issue of interest, will be subject to the outcome of the present petition - application disposed off.
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2016 (9) TMI 876
Prayer for release of vehicle - confiscation of vehicle - option to pay redemption fine - demand of differential customs duty - imposition of penalty - Motor Bike Harley Davidson - illegal import - seizure - Held that: - serious prejudice will be caused to respondent if the disposal of appeal is delayed - the Customs, Central Excise and Service Tax Appellate Tribunal, Bangalore Bench shall dispose of the appeal as expeditiously as possible, and at any rate, within eight weeks.
Petition disposed off - decided in favor of respondent.
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2016 (9) TMI 875
Validity of criminal revision - summon of revisionist under section 135 of the Customs Act, 1962 - raid - search of godown - Chinese silk yarn - seizure under Section 11 of Act, 1962 - recording of statement Sections 107 and 108 of Act, 1962 - summon of four persons who were alleged to be partner in smuggling under Section 108 of Act, 1962 - Held that: - Here is a case at a nascent stage when on the basis of complaint made by a Public Servant, i.e., Assistant Commissioner (Customs), Varanasi alleging that accused-revisionists have committed an offence under Section 135 of Act, 1962, Magistrate has summoned revisionists against whom allegations have been made in the compliant that these are the persons who have committed offence under Section 135 of Act, 1962. In order to form opinion, prima facie, at this stage, Magistrate is supposed to look into the allegations contained in the complaint and the material placed along with it which in the present case include seizure memo, confessional statement of Vijay Kumar as well as statements of accused-revisionists which have been looked into by Magistrate and thereafter it has formed an opinion that a prima facie case has been made out, hence summons have been issued. Nothing has been placed to show that material available before Magistrate, even if believed to be true, no person of ordinary prudence can come to a conclusion that even prima face no case of commission of offence by accused-revisionists under Section 135 of Act, 1962 is made out.
Looking to the summoning order issued by SCJM, it can be said that whatever material was available before Court below, it has considered the same, and, after applying its mind to the material available before it, has issued process to revisionists and it cannot be said that the same is illegal or contrary to law in any manner, hence, no interference is called for in this criminal revision.
Criminal revision valid.
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2016 (9) TMI 874
Valuation - royalty/ value of designs, drawings etc. - assessable value - Rule 9(i)(b)(iv) of the Customs Valuation Rules, 1988 - collaboration agreement - whether royalty/ value of designs, drawings includible in the assessable value? - Held that: - all the specifications of the shoe are supplied by the appellant to the vendor in the shape of catalogue and real shoe approved by the appellant as well as the foreign collaborator. A design need not be two dimensional it can be three dimensional piece of the product which can be copied both in respect of design and material specifications - Rule 9(i)(b)(iv) attracted - royalty/ value of designs, drawings includible.
Design of the production is only one of the component of the collaboration agreement. There are many more services which are provided in respect of the goods marketed by the appellant by the foreign collaboration. Only a portion of the lump sum amount attributable to the design cost of product manufactured abroad.
Matter remanded back to the original adjudicating authority for determination of appropriate quantum of the value to be added - appeal disposed off - decided against appellant.
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2016 (9) TMI 834
Rejection of refund claim - assessment - declared price - valuation - import of 24 consignments of Gambler - Duty Free Replenishment Certificate - Foreign Trade Policy - exemption of basic customs duty - lack of jurisdiction - Assistant Commissioner of Customs - alternative remedy of filing an appeal - section 128 of Customs Act, 1962 - section 27 of Customs Act, 1962 - rejection of declared value - rule 10A of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 - whether the Commissioner (Appeals) was within jurisdiction to reject the enhancement of the declared value? - Held that: - the enhancement of assessable value by the assessing officer was without authority. That lacuna cannot be rectified by mere access to appellate remedies through a ‘bill of entry’ as a cause of action. For the purposes of section 128 of Customs Act, 1962, however, ‘assessment’ and ‘adjudication’, though different, are orders or decisions.
Whether the first appellate authority was correct in restoring the refund claim to the jurisdictional competence of the original authority? - Held that: - on the day of rejection of the refund claim, the original authority was not under instructions to disregard refund claims that were submitted without an appellate order setting aside the assessment. The original authority determined ineligibility for the refund claim without any recorded or acceptable rationale. The first appellate authority has, in accordance with the law as it then prevailed, set aside the rejection by the lower authority and restored the refund claim.
The first appellate authority has erased the impediment by resolving the assessment dispute which was well within its jurisdiction to do so. That jurisdiction, even if deemed to have been exercised in the latest bill of entry, settles the principle that declared value could not have been rejected for assessment making it applicable to all assessments that preceded it - restoration of refund claim upheld - appeal dismissed - decided against Revenue.
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2016 (9) TMI 833
Maintainability of writ petition - alternative remedy of appeal under Sec. 129A of the Customs Act, 1962 - assorted confectionary items - principles of natural justice - revocation of CHA license under Regulation 20(1) of the CHALR 2004 (replaced by Regulation 18 of the Customs Brokers Licencing Regulations, 2013 - forfeiture of security deposit - whether the writ petition is maintainable when the alternative remedy of appeal is available? - Held that: - the decision in the case Whirlpool Corporation Versus Registrar of Trade Marks, Mumbai & Ors.[1998 (10) TMI 510 - SUPREME COURT] is relied upon. Availability of an efficacious alternative remedy is not an absolute bar to the maintainability of a writ petition. The High Court, having regard to the facts of a case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective alternative remedy is available, the High Court would not normally exercise its writ jurisdiction. The High Court will require the aggrieved party to exhaust the alternative remedy before the Court intervenes by way of judicial review.
The customs law is a complete code by itself. The Customs Act and the Rules and bye-laws framed thereunder constitute a comprehensive and exhaustive Code. The appeal is a more comprehensive remedy in which all issues including factual issues and sufficiency or otherwise of the evidence on record can be gone into. When a statute is a complete code in itself on the concerned subject like the Customs Act and it provides a particular remedy before a particular forum, the aggrieved party must ordinarily exhaust such remedy before invoking the high prerogative writ jurisdiction of the High Court. This is a practice ordinarily followed by the Writ Courts and nothing extraordinary found in the facts of this case to depart from such well established practice. The decision in the case Nepa Agency Co. Pvt. Ltd. vs. Union of India [2015 (5) TMI 802 - CALCUTTA HIGH COURT] is followed.
Whether a writ petition can be dismissed on the ground of alternative remedy if the same has been admitted for hearing? - Held that: - it is not the legal position that once a petition is admitted, it cannot be dismissed on the ground of alternative remedy. The decision in the case of State of Uttar Pradesh-vs.-Uttar Pradesh Rajya Khanij Vikas Nigam Sangharsh Samiti [2008 (5) TMI 642 - SUPREME COURT] is followed.
The court is not inclined to exercise its extraordinary power under Art. 226 of the Constitution - if the petitioners approach the CESTAT by way of appeal against the order under challenge in this writ petition within a period of 6 weeks from date, the Tribunal shall decide such appeal in accordance with law without being influenced by any observation in this order, as expeditiously as possible, and preferably within a period of 6 months from date of presentation of the appeal, if any - petition dismissed - decided against petitioner.
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2016 (9) TMI 832
Release of detained consignments - confiscation of consignments under Section 111(I) of the Customs Act read with Section 3(3) of the Foreign Trade (Development & Regulation) Act, 1992 - option to pay redemption fine of ₹ 3,50,000/- under section 125 of the Customs Act, 1962 - imposition of penalty of ₹ 25,500/- and ₹ 90,000/- under Section 112(a) of the Customs Act, 1962 - order of the Commissioner of Customs (Appeals) Air, Chennai not implemented by the respondent - respondent filed revision before the revisional authority - Held that: - the decision of the case Union of India vs. Kamalakshi Finance Corporation [1991 (9) TMI 72 - SUPREME COURT OF INDIA] would apply.
The Hon'ble Apex Court and this Court in various cases very categorically held that the order of the Joint Commissioner of Customs and the Commissioner of Customs (Appeal) clearly shows that the petitioner has not committed any violation, therefore, they should implement the order of the Commissioner of Customs in a true letter and dispute. The petitioner is entitled to get release of the gold, since the long delay in release of the goods would, no doubt, reduce its potency and its market value would deteriorate to the detriment of the petitioner. There is nothing shown on behalf of the respondent to substantiate their claim that necessary steps had been taken to obtain interim order of stay against the order of the authority.
Mere filing of the revision against the order of appellate authority would not empower the respondent to deny release of the goods in question and the respondent have not given any proper explanation as to why no stay order has been obtained against the order of the Commissioner of Customs (Appeals) , even though the said order said to have been challenged by way of further appeal. Therefore, the petitioner cannot be made to suffer due to detention of the goods in question, which had been imported by the petitioner - petitioner entitled to get release of the goods - consignment to be released on payment of redemption fine and penalty - petition allowed - decided partly in favor of petitioner.
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2016 (9) TMI 831
Enforcement of Bond and Bank Guarantee - Denial of refund claim - milled rice - broken rice - export - local sales - EPCG scheme - Notification No.55/2003, dated 01.04.2003 - import of two series colour sorter and two feed chutes with essential spare parts from abroad at concessional duty of 5% - discharge of export obligation - whether the petitioner has to be directed to approach the Assistant Commissioner (Refunds) or a direction to be issued to the first respondent who has cancelled the bank guarantee of the petitioner - Held that: - the case of Commissioner of Customs, Chennai Vs. M/s.Aristo Spinners Pvt. Ltd.[2008 (1) TMI 160 - HIGH COURT MADRAS] relied upon.
The petitioner need not be called upon to approach the Assistant Commissioner (Refunds) and the first respondent himself can consider the petitioner's claim as the first respondent has cancelled the bond and bank guarantee on the petitioner producing the Export Obligation Discharge Certificate.
The petitioner to submit a representation along with a copy of this order - after taking note of the legal position and also the factual position, refund to be effected within a reasonable time, not later than eight weeks from the date of the receipt of the representation - petition disposed off - decided in favor of petitioner.
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2016 (9) TMI 830
Valuation - inclusion of royalty in the value of imports - collaboration agreement - related party - M/s.Herbalife USA holds 75% of the equity in Herbalife International India Pvt. Ltd - import of material from Herbalife USA - valuation by SVB - Rule 2(2) of the Customs Valuation Rules, 1988 - royalty paid by the importer under the agreement relates to the manufacturing process of product to be manufactured in India or to the manufacture of imported goods - Rule 9(1)(C) of the Customs Valuation Rules, 1988 - rules of interpretation - Rule 12 of the Customs Valuation Rules, 1988 - Held that: - the decision of the Hon'ble Apex Court in the case of Matsushita Television & Audio (I) Ltd [2007 (4) TMI 5 - SUPREME COURT OF INDIA] is relied upon.
Only such royalty which is relatable to the imported goods and which is a condition of sale of such goods alone could be added to the declared price - the license and technical assistance agreement entered between the appellant and the Herbalife, USA provide for transmission of technical information and grant of license and involves consideration in the shape of royalty. Running royalties are condition of sale for the transaction value and thus needs to be added in the value for the purpose of payment of Customs duty.
Appeal allowed - decided partly in favor of appellant.
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2016 (9) TMI 829
Revocation of CHA license - forfeiture of security - imposition of penalty - Regulation 22 of CBLR, 2013 - attempt for irregular export of misdeclared cargo with a view to facilitate ineligible export incentive - statutory time limits - Regulation 20 (5) of CBLR, 2013 - enquiry report to be submitted within 90 days - Held that: - when statutory time limits are prescribed under the law the same has to be strictly adhered to. The legal position in respect of time limits prescribed under Regulation 20 has been repeatedly held to be mandatory in nature. Failure to adhere the same will make the proceedings invalid. The issue is similar as decided in the case Indair Carrier Pvt. Ltd. vs. CC (General) [2016 (5) TMI 775 - DELHI HIGH COURT] - As enquiry report not submitted within 90 days, merits of the case not considered.
Appeal allowed - decided in favor of appellant.
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2016 (9) TMI 779
Benefit of the Notification No. 12/2012-Cus - import of aircraft for providing charter service - benefit of notification available subject to the Condition No. 77 prescribed in the Notification - Whether the benefit of the Notification No. 12/2012-Cus is available to NSOP holder for the following categories of revenue flights proposed to be undertaken; a) Use by the permit holder’s employees/directors/investors and their family/friends, not necessarily for business purposes. b) Charter the aircraft to group companies for use by their employees/directors/investors and their family/friends, not necessarily for business purposes c) Lease the aircraft to group companies for use by their employees/directors/investors and their family/friends, not necessarily for business purposes?
Held that: - the conditions prescribed in the notification, make it clear that approval of competent authority is required for import of aircraft for providing non-scheduled (passenger) services or non-scheduled (charter) services and importer is required to furnish undertaking to the Deputy/assistant Commissioner of Customs at the time of import to the effect that the aircraft shall be used only for providing non-scheduled (passenger) services or non-scheduled (charter) services, as the case may be. The conditions have to be read in conjunction with Explanation 2 to the notification, which clarifies that the use of such imported aircraft by a non-scheduled (passenger) operator for non-scheduled (charter) services or by a non-scheduled (charter) operator for non-scheduled (passenger) services, shall not be construed to be a violation of the conditions of import at concessional rate of duty. It is noticed from the application filed by the applicant at Annexure I that the applicant is proposing to import aircraft for providing non-scheduled (charter) services - applicant may use the aircraft imported for providing non-scheduled (passenger) services or non-scheduled (charter) services.
Non-scheduled (charter) services are explained under Explanation 1 and one of the ingredients of non-scheduled (charter) services is that it should conform to CAR, which is issued under Rule 133A of the Aircraft Rules, 1937. Rule 133A of the Aircraft Rules, 1937 authorizes the Director General to issue special directions through notices etc including CAR relating to operation, use, possession, maintenance or navigation of aircraft flying over India or aircraft registered in India. Paragraph 2.5 of CAR inter-alia also allows non-scheduled operator to operate revenue charter flights for a company within its group companies, subsidiary companies, sister concern, associated companies, own employees, including Chairman and members of the Board of Directors of the company and their family members, provided it is operated for remuneration. It is to be observed that CAR does not extend this facility to investors and friends. In view of the above, paragraph 2.5 of CAR issued in pursuance of Rule 133A of the Aircraft Rules, 1937 is regarding operation and use of aircraft and same is part of Explanation I (c) to Notification No. 12/2012-Cus. It also noticed that the subject notification as well as contents of CAR does not debar the use of said aircraft for other than business purposes - aircraft can be used for other than business purposes
The intended purpose of the aircraft to be imported in the nature of personal use or public use - Held that: - exemption notification does not cover such conditions; that public interest is always a guiding factor in exemption notification and applicant does not fall within the scope of the notification.
The benefit of the Notification No. 12/2012-Cus is available to NSOP (Non Schedule Operator’s Permit) holder for the following categories of revenue flights( with published tariff) proposed to be undertaken; a) Use by the permit holder’s employees/directors and their family, not necessarily for business purposes. b) Charter the aircraft to group companies for use by their employees/directors and their family, not necessarily for business purposes. c) Lease the aircraft to group companies for use by their employees/directors and their family, not necessarily for business purposes.
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2016 (9) TMI 778
Calculation of differential duty demanded - BCD - CVD - SAD - Section 3A(5) of the Customs Tariff Act, 1975 - Central Excise Notification No.14 of 2002, dated 01.03.2002 - whether SAD will apply to the goods chargeable to additional duties levied under Section 3(1) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957? - Held that: - the additional duty leviable and the power to levy the Additional Duty of Excise is traceable to sub-section (5) of Section 3 of the Customs Tariff Act, 1975, which gives power to the Government to levy such additional duty as would counter balance the sales tax on a like article on its sale in India.
The goods which were imported by the petitioner were meant to be used for manufacture and the petitioners availed the benefit of the exemption notification. This condition having been violated and the goods having been cleared to the domestic area and the petitioner having accepted their mistake, the additional duty of excise is leviable in terms of sub-section (5) of Section 3 of the Customs Tariff Act. The exemption which is sought to be granted by the Budget Notification pertains to the duty leviable under sub-section (1) of Section 3 of the Customs Tariff Act and there is no reference to the additional duty of excise leviable in terms of sub-section (5).
The petitioner already accepted before the Settlement Commission regarding the leviability of the additional duty of excise at 8% - the petitioner has not made out any case for interfering with the order passed by the Settlement Commission.
Petition disposed off - decided in favor of petitioner.
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