TMI Blog2013 (10) TMI 1305X X X X Extracts X X X X X X X X Extracts X X X X ..... 2(33), 111(d) and 113(d) of the Customs Act, 1962. - benefit of exemption was not available as the goods were attempted to be smuggled into India. As per Customs Tariff the diamonds attract duty and hence said goods are classifiable under heading 9803. The goods were liable to confiscation for violation of provision of law - Decided against assessee. - F. No. 371/04/B/2013-RA - 232/2013-Cus - Dated:- 7-10-2013 - Shri D.P. Singh, Joint Secretary Shri Krishan Kumar and Manya Bhardwaj, Advocates, for the Assessee. ORDER This revision application is filed by applicant Ms. Neesha Ram Jagtiani, 7 Homantin Hill, 12th Floor, Flat C2, Fairland Gardens, Kowloon, Hongkong against the Order-in-Appeal No. 348/2012-Air, dated 8-10-2012 passed by the Commissioner of Customs (Appeals), Mumbai-III with respect to Order-in-Original No. 66/2010-11, dated 7-2-2011 passed by Addl. Commissioner of Customs, CSI Airport, Mumbai. 2. Brief facts of the case are that the applicant arrived at CSI Airport, Mumbai from abroad and opted for green channel. While passing through green channel, she was asked to put her baggage through baggage screening machine. During screening some suspicious ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ute and unconditional exemption as far as the subject goods are concerned. Furthermore, it is settled law that exemption notification is to be strictly intercepted and the departmental authorities cannot impose any condition which is not imposed under the notification. 4.5 The impugned diamonds are neither prohibited goods nor are they dutiable goods . In this view of the matter, the findings and the conclusion drawn by the adjudicating authority are erroneous and unsustainable. 4.6 The Commissioner (Appeals) has considered and decided the case without properly appreciating the facts of the case. Consequently, failed to apply the law correctly. At the outset, applicant submits that the only ground on which the Commissioner (Appeals) order has upheld the Order-in-Original is by coming to the conclusion that the subject goods were prohibited goods and dutiable goods. It is humbly submitted that this conclusion is completed misconceived and unsustainable. 4.7 The subject goods viz. polished diamonds are classifiable under Chapter 71 of Customs Tariff Act, 1975. It is further not in dispute that said goods are exempted vide Notification No. 21/2002-Cus. as amended from time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding 98.03 of Customs Tariff Act, 1975, what is to be seen is whether the said goods are dutiable articles. The applicant cited the following case laws in her defence : (i) Associated Cement Companies Ltd. v. Commissioner of Customs reported in 2001 (128) E.L.T. 21 S.C. (ii) Reliance Industries Ltd. v. Commissioner of Customs, Mumbai [2007 (207) E.L.T. 412 (Tri.-Mumbai). The applicant finally pleaded that confiscation of goods and imposition of redemption fine and personal penalty is illegal hence the Order-in-Appeal may be set aside. 5. Personal hearing was scheduled in this case on 8-8-2013 at Mumbai. Shri Krishan Kumar and Shri Manya Bhardwaj, Advocates attended hearing on behalf of the applicant who reiterated the grounds of Revision Application. 6. Government has carefully gone through the relevant case records and perused the impugned Order-in-Original and Order-in-Appeal. 7. Government notes that applicant passenger while passing through green channel, was asked to get her baggage screened at the baggage screening machine. On seeing some suspicious dark images, she was diverted to red channel for detailed examination of baggage which resulted int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cement Companies Ltd. v. Commissioner of Customs [2001 (128) E.L.T. 21 (S.C.)]. (ii) Reliance Industries Ltd. v. Commissioner of Customs, Mumbai [2007 (207) E.L.T. 412 (Tri.-Mumbai)] 8.1 With regard to the issue whether the applicant by importing diamond through baggage mode had contravened any provision of Customs law or any other law for the time being in force Government notes that the applicant imported diamond valued at ₹ 7,80,982/- through baggage mode and on arrival opted for green channel Customs clearance. Customs diverted the passenger to red channel for detailed examination of goods which resulted in recovery of said goods. As per Section 77, the owner of any baggage shall for the purpose of clearing it make a declaration of its contents to the proper officer. The passenger failed to comply with the provisions of Section 77. Applicant was required to declare the description, quantity and the value of the goods imported by her on customs declaration slip as per Rule 11 of the Foreign Trade (Regulation) Rules, 1993 but no such declaration was made in said slip. 8.2 Applicant has contended that the said diamonds were duty free in terms of Not. No. 21/2002 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification, it is clear that the benefit of the exemption envisaged is for those goods that are imported. According to Section 2(25) imported goods has been defined to mean ... any goods brought into India from a place outside India but does not include goods which have been cleared for home consumption. It is necessary that the above definition is read along with Section 11, Section 111 and Section 112 of the Act, which provide for detection of illegally imported goods and prevention of the disposal thereof, confiscation of the goods and conveyances and imposition of penalties respectively. Under Section 111(d) of the Act, any goods which are imported contrary to any prohibition imposed by or under this Act or any other law for the time being in force shall be liable for confiscation. The goods which have been seized in this case cannot be imported into India without a license under the Import Control Act and there is, therefore, a prohibition in law for the import of goods except in compliance with the Import Control Act. It is not the case of the respondent-firm that the goods were imported with a valid license and, therefore any import of goods of which importation is prohi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... definition of imported goods for the purpose of the Act. In the same light, it would be contrary to the purpose of exemption notifications to accord the benefit meant for imported goods on smuggled goods 15. The Tribunal has relied on the decision of this Court in the case of Associated Cement Companies v. Commissioner of Customs, [2001 (128) E.L.T. 21 (S.C.)] to extend the benefit of the exemption Notification on the respondent-firm, despite the fact that the goods that were in question were not smuggled goods. In the case of Associated Cement Companies Ltd. (supra), the question that fell for consideration was whether customs duty was leviable on technical material supplied in the form of drawings, manuals and computer disc. etc. The further question was that if customs duty was leviable, how it was to be valued. While answering the issue, this Court has observed that Section 12 of the Act provides that the duties of customs shall be levied at such rates as may be specified under the Customs Tariff Act. When the Customs Tariff Act itself provides that the import of drawings and designs under Heading No. 49.06 is free, it must follow that these drawings and designs, though g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods except in compliance with the Foreign Trade Policy. Non-compliance of these provisions renders the goods (prohibited goods) liable for confiscation under Section 111 of the Customs Act, 1962. The Hon ble Apex Court in the case of Om Prakash Bhatia v. Commissioner of Customs, Delhi [2003 (155) E.L.T. 423 (S.C.)] citing its earlier judgment in Sheikh v. Commissioner of Customs, Calcutta and Others [(1970) 2 SCC (728) = 1983 (13) E.L.T. 1439 (S.C.)], had held that importation or exportation could be subject to certain prescribed conditions, to be fulfilled before or after clearance of goods. If the conditions are not fulfilled, it may amount to prohibited goods in terms of Sections 2(33), 111(d) and 113(d) of the Customs Act, 1962. The ratio of this judgment applies squarely to the facts of the present case. The same view was also held by the Hon ble Supreme Court in the Swamynatan Murugesan against the Madras High Court judgment dated 27-4-2009 in CMA No. 2040 of 2007 as reported in [2009 (247) E.L.T. 21 (Mad.) where the Hon ble Apex Court could observed as under : Applying the ratio of the judgment in the case of Om Prakash Bhatia v. Commissioner of Customs, Delhi reporte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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