TMI Blog2012 (3) TMI 310X X X X Extracts X X X X X X X X Extracts X X X X ..... 3-2012 - MR.JUSTICE.V.DHANAPALAN, J. For Petitioner ... M/s.N.Viswanathan For Respondents... Mr.R.Aravindan Standing Counsel ORDER This Writ Petition has been filed for a direction to the respondents herein to provisionally assess and clear the consignment comprising of 104 units of old and used secondhand Digital Multifunction Print and Copying Machines and 10 units of old and used secondhand photocopying machines (henceforth called as 'imported goods') covered by Bill of Entry No.3394138 dated 03.05.2011 without insisting for a licence for its import in terms of the Foreign Trade Policy read with Foreign Trade (Development and Regulation) Rules, upon the petitioner paying the applicable duties of customs of the enhanced value as determined by the chartered engineer. 2. The facts of the case, in a nutshell, are as follows:- a) The petitioner concern has been engaged in the import and trading of secondhand digital multifunction printing and copying machines as also the secondhand photocopier machines and its accessories, parts and consumables. For carrying out the said business, the petitioner has been provided with Import and Export Code No.410042277 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent, he was driven from pillar to post and made to suffer immensely by the respondents by not assessing the subject goods and to permit clearance of the goods even after the chartered engineer has examined the goods and given his report to the department. The petitioner contends that once the chartered engineer report has been obtained, there cannot be any impediment for the respondent department to get the goods assessed and cleared on payment of appropriate duty. But, the same has not been done by the respondent department for certain extraneous and irrelevant considerations. d) The petitioner further submits that the import of the second hand photocopiers and also secondhand digital multifunction print copying machines are being permitted through the Tuticorin, Chennai, as well as the other ports for the last two decades. He further submits that from December 2006, the Customs Tariff Act was amended in terms of which a new subheading bearing no. No.8441 3100 was inserted / introduced for the digital multifunction print and copying machines, while the photocopier machines were shifted and introduced under CTH No.8443 3930 of the said Tariff Act from erstwhile Tariff headin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , which directed the release of the goods on payment of the applicable duties on the enhanced value and cash deposit of 25% of the said enhanced value. The said judgment was followed in several writ petitions filed for the release of such goods. It is also submitted that the same condition was imposed even for release of secondhand photocopier machines by this Hon'ble Court consequent to one of the importer challenging the jurisdiction of the Director General of Foreign Trade to issue the notification restricting the import of the said goods, which order was also confirmed by the Hon'ble First Court on an appeal by the revenue, which order has become final as no appeal against the said order has been preferred. Against the order of learned single Judge, it went on appeal, which also got dismissed by the Hon'ble First Bench of the Madras High Court in W.A.Nos.l 190 to 1194 of 2011 with a specific direction to release the goods. The said respondent had accordingly released the goods with a detention certificate as agreed to by him in the contempt proceedings. The Division Bench of Customs, Excise Service Tax Appellate Tribunal, South Zonal Bench at Bangalore, had recently passed fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permitted clearance of the subject goods, pursuant to the orders of the Hon'ble High Court of Madras at Madurai Bench in W.P(MD).No.1344/2011 dated 30.09.2011 W.P(MD).Nos.11503, 11510, 11608 of 2011 dated 19.10.2011 permitting clearance of the subject goods on the petitioner depositing 25% on the enhanced value apart from the actual duties payable on the enhanced value and also by executing a personal bond for the remaining differential duty with liberty to the respondents to proceed with adjudication in accordance with law. The petitioner further submits that inspite of the orders of this Court, wherein the 1st and 2nd respondents herein were also a party to the proceedings therein, the respondents have not made any attempt to proceed further with the assessment and clearance of the subject consignment of the petitioner, inspite of the fact that there is no objection whatsoever recorded by the officials, coupled with the fact that the chartered engineer has inspected and given his report nothing objectionable, except for a marginal increase in the declared value, which was also accepted by the petitioner herein without prejudice to his rights to proceed in a manner known to law. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustom House Agent License No.AJFPP0732JCH001 on behalf of an importer M/s First Track Traders, at No. 126/6, Valluvar Nagar Red Hills Road, Villivakkam, Chennai. The importer is having IEC No.0410042277 and Income Tax PAN No.AUPPR7664CFT. The supplier firm was shown as M/s Jade Group Limited (BR), PO Box No.8124 - Sharjah - UAE, is 5113 dated 07.04.2011. Since the imported material is of old and used nature, the said consignment was subjected to the examination of a Chartered Engineer. On 07.05.2011, the goods were inspected by one P.Senthoor Pandian, a Chartered Engineer and Valuer at 178/6, Palayamkottai Road, Tuticorin. In his detailed valuation report, dated 09.05.2011, the said Chartered Engineer valued the goods as USD 26150 as against the declared value of USD 24750. According to the report, there were two types of Photocopier machines in the said consignment. There are 104 numbers of multifunction (print and copying) machines and 10 numbers of photocopier machines. There are two types of classifications involved. The Multifunctional (print and copying) Machines are classifiable under Chapter Heading No.84433100 and the Photocopier Machines are classifiable under Chapter Hea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rore value; that his client was also pressurized to give further report on the value aspects. However, the said Counsel has also so far neither appeared on behalf of the original importer nor produced the documents called for from the importer. 3.4. Thus, the original importer Sri.Mohamed Hasan failed to appear before the investigating officer to claim the ownership and to produce necessary license to prove the licit nature of the imported goods. The value is another aspect which needs to be clarified in the absence of scientific opinion lacking on the part of the Chartered Engineer. The Chartered Engineer certified all the 114 machines as Xerox Machines whereas the category of import items are found to be Multifunctional (Copying Printing) Machines and Photocopier Machines as admitted in the petition. The importer has to furnish the details and the import goods are to be subjected to further assessment through other more qualified technical persons. 3.5. It is submitted that the petitioner has not retracted the statement given before the Investigating Officer under Section 108 of the Customs Act, 1962 on 20.05.2011 wherein, he denied the ownership of the import goods. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... last 9 months which is highly improper and arbitrary. Therefore, the action of the authorities is contrary to circular No.42/2001 dated 31.7.2001 issued by the Ministry, which circular as per the judgment of the Hon'ble Supreme court is binding on them; that he is the owner of the goods and is liable to remit the value for the goods to the overseas supplier; that the invoice issued by the overseas supplier, packing list, bill of lading all issued in his name which documents he had filed along with the Bill of Entry clearly evidences his title to the goods leaving no room for the authorities to take any contrary stand and that the petitioner also admittedly holds the Import Export Code (IEC) and Income Tax PAN Card issued in his favour establishing his right to import the goods. 4.2. Further, the only reason for initiating investigation is the import of the goods without a licence. When the goods are importable without a licence, as per the decision of the Bangalore Tribunal in the case of M/s.Shivam International and another Vs. CC,Cochin, in A.No.2477 to 2488 of 2010, dated 26.05.2011 and in view of the Minutes of the high level meeting held by the Ministry of Environment For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined in regulation 6 (I) of the Handling of Cargo in Customs Area Regulations, 2009 and the judgment of the Hon'ble Delhi High Court reported in 1988 (37) E.L.T. 512 (Bom) as well as the Full Bench of this Hon'ble High Court in the case reported in 1980 (6) E L T 128 (Mad) and also in the case reported in 2009 (244) E L T 15 (Mad) which on appeal had resulted in the customs being saddled with the entire demurrage charges vide judgment of the Hon'ble Madras High Court and for issuance of a consequential direction to the customs to bear the costs of demurrage incurred on the goods on account of its long storage due to the inaction of the authorities for not obeying the instructions of their own Ministry. 5. In support of his contentions, learned counsel for the petitioner has cited the following decisions of the Court:- 5.1. In Union of India Vs Sampat Raj Dugar reported in 1992 (58) E.L.T. 163 (S.C.), in para 19, it is held as follows:- "19. We may first consider the question of title to the said goods. If we keep aside the provisions of law relied upon by the appellants viz., definition of 'importer' in Section 2(26) of the Customs Act, Clause 5(3)(ii| of the Imports (Control ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the licensee at the time of import and thereafter up to the time of clearance through Customs." The Rule making authority (Central Government), which issued the order, must be presumed to be aware of the fact that in many cases, the importer is not the owner of the goods imported at the time of their import and that he becomes their owner only at a later stage, i.e., when he pays for and obtains the relevant documents. Why did the Central Govt, yet declare that such goods shall be the property of the licensee from the lime of import? For appreciating this, one has to ascertain the object underlying the said provision. The interpretation to be placed upon, the provision should be consistent with and should be designed to achieve such object. In this context, it should also be remembered that expressions like 'Property of and 'Vest' do not have a single universal meaning. Their content varies with the context. The aphorism that a word is not a crystal and that it takes its colour from the context is no less true in the case of these words. In our opinion the object underlying Condition (ii) in Clause 5 (3) is to ensure a proper implementation of the Imports (Control) Order and the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Apparels Pvt.Ltd. It is submitted that on a reading of Section 2(26) of the Customs Act,1962, it would be clear that once the owners are known no duty could have been imposed on the appellant herein. Learned Counsel also placed reliance on the judgment of this Court in 1992 (58) E.L.T. 163 (S.C.), cited supra. 5.On the other hand on behalf of the Revenue learned counsel submits that the appellants were the importers, who had filed the bill of entry and had paid customs duty as per their admission as reflected in the reply to the show cause notice and also filed declaration in terms of Section 46 of the Customs Act. Under these circumstances, it is set out that there is no substantial question of law arising in this appeal and accordingly, the appeal should be dismissed. 6.Having heard learned counsel we are of the opinion that there is no merit in this Appeal. In the first instance, the bill of entry was filed by the appellant herein. Under section 46 of the Act the importer apart from other things in terms of sub-section (4) has to subscribe a declaration as to the truth of the contents of such a bill of entry. In the bill of entry admittedly, the appellant herein had not disclo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities concerned and give evidence. Since the original importer has not turned up to claim the ownership, the goods are to be treated as abandoned and to be dealt with accordingly. The goods can never be assessed in the name of a person who totally denied the ownership of the goods. The real owner has to prove the ownership of the goods in question. In this case, the petitioner himself has denied the ownership of the goods before the authorities concerned. In as much as the imported goods are attempted to be cleared by undervaluing and also without valid import licence the said goods are liable for confiscation under Section 111(d) and 111(m) of the Customs Act, 1952. Therefore, this petition is liable to be dismissed. 6.2. In support of his contention, the learned counsel for the respondents has relied on the following decisions:- a) In (1999) 3 SCC 614, T.C.Mathai and another Vs. District and Sessions Judges, Thiruvanathapuram, Kerala, in para 15, it is held as follows:- "15. Section 2 of the Power of Attorney Act cannot override the specific provision of a statue which requires that a particular act should be done by a party-in-person. When the code requires the appeara ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty should be allowed or not. While the learned counsel for the appellant relied on the provisions of the Foreign Trade (Development and Regulation) Act,1992, and Foreign Trade (Exemption from application of Rules in certain cases) Order, 1993 to contend that gold is not a prohibited goods which can be released on payment of redemption find and duty, learned Standing Counsel appearing for the Department relied on the judgment of the Supreme Court in Om Prakash Bhatia Vs. Commissioner of Customs, Delhi, reported in 2003 (155) E.L.T.423, and contended that when import is permissible on satisfaction of certain conditions, the violation of the same will make the goods imported as prohibited goods within the meaning of Section 2(33) of the Act, which reads as follows:- "2(33) ' Prohibited goods' means any goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported have been complied with" After hearing both sides and after considering the statutory provisions, we do not think th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port dated 09.05.2011, confirming to the description of the goods as found in the invoice filed by the petitioner herein and valued the goods marginally higher than the one declared by the petitioner herein, before the Customs and no diligent steps were initiated by the respondents herein to assess and clear the goods at an early date in terms of the provisions contained in the Customs Act, and the regulations made thereunder, overlooking the circular no.42/2001 issued by CBEC, New Delhi, providing for speedy clearance of goods imported. In the meantime, the Directorate of Revenue Intelligence, the 3rd respondent herein, took up investigation in the matter against the petitioner concerned, concerning the import of subject goods. He was also summoned by the Directorate of Revenue Intelligence, and a statement under Section 108 of the Customs Act was recorded from him, which was exculpatory in nature. While so, the third respondent arranged for a invoice of higher value, for which, the petitioner sent a notice through his advocate. The petitioner contends that once the chartered engineer report has been obtained, there cannot be any impediment for the respondent department to get the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 11. It is a settled legal position that once a statement is made under Section 108 of the Act, it is done in the case of prosecution, unless it is retracted or cancelled, the petitioner's claim for assessment or provisional assessment cannot be considered. The reliance made by the learned counsel for the petitioner will not have support to the present peculiar facts and circumstances of the case and therefore, he cannot have any advantage of those decisions cited supra. 12. Analyzing all the factors involved in this case and after considering the statutory provisions, I am of the opinion that the petitioner, as a matter of right, cannot claim release of the goods as long as the statement made by him is still in force. Further, as per Section 108 of the Act, the Customs authorities have rightly summoned persons to give evidence and produce documents. Based on which, the claim of the petitioner is negatived. When a person is unable to establish the ownership of the goods, needless to say, the respondents vest with the power to reject the claim of the petitioner. 13. For the foregoing reasons and discussions, I am of the considered view that mere production of Bill of Entry ..... X X X X Extracts X X X X X X X X Extracts X X X X
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