TMI Blog2017 (6) TMI 1059X X X X Extracts X X X X X X X X Extracts X X X X ..... General of Foreign Trade is a law and not an executive instruction and the import and export is governed under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 - the contention of the appellant that the notification issued under Section 5 of the Foreign Trade Act, is a mere executive instructions and so the said notification would not apply to the appellant company cannot be accepted. Has the 2nd respondent Tribunal erred materially in not even referring are going into the provisions of Section 38 of the Insecticide Act, which exempts, the provisions of the Act including licensing/ obtaining import permit from the Central Insecticide Board under Section 9 of the said Act, when the goods under import are admittedly for non-insecticidal use? - Held that: - imports are governed by other Acts also and the contention of the appellant that Insecticides Act alone applicable, is not correct - The appellant, merely submitting a declaration to the end use that the Bronopol will be used for non-insecticidal purpose is not sufficient and therefore exemption under Section 38(1)(b) of the Insecticides Act cannot be applied automatically, to the appellant. The appellant ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 08.04.2015, with the office of the concerned authorities, for assessment and clearance of the subject goods. The subject goods were not released by the authorities, for the reason that the appellant has to put up technical literature with respect to the goods and its classification adopted in CTH 2930 9099, besides submitting the other import documents, already furnished. While the same were furnished, the concerned authority again directed the appellant to furnish a Central Insecticide Board (CIB) Registration Certificate, with respect to the subject goods. The appellant contended before the concerned authority that the requirement of production of CIB Registration certificate for the said goods does not arise, as the goods under import has not been classified under EXIM code 3808 of Chapter 38 in ITC (HS) 2012-Schedule-I (Import policy). Further, the appellant had stated that the Notification No.106/RE-2013/2009-2014 dated 01.01.2015 issued by the office of the Director General of Foreign Trade will have no application to the present import, as the goods will not fall under the aforesaid classification of goods mentioned in the notification. It was also submitted before the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Act 1968 would be arbitrary, unreasonable and violative of Article 14 of the Constitution of India. 4) The appellant also raised a ground that the classification for the subject goods are adopted under CTH 2930 9099 and the appellant are entitled to import the subject goods, mainly under the Circular No. 401/101/2011-Cus III dated 26.02.2011, issued on the basis of Section 38 of the Insecticides Act, 1968. 5. The aforesaid appeal filed by the appellant was rejected by the Commissioner of Customs (Appeals II) on 30.06.2015, holding that the plea of the appellant cannot be accepted, as the decisions relied by the appellant relates to import made prior to the issuance of the DGFT Notification No.106/2013/2009-2014 dated 01.01.2015, which has envisaged that import permit is necessary from the Registration Committee under the Department of Agriculture and Co-operation for all insecticides, even if they are imported for non-insecticidal purposes. 6. The appellant challenging the order of the Commissioner of Customs (Appeal-II) dated 30.06.2015, filed an appeal in C/41616/2015-DB before the Customs, Excise and Service Tax Appellate Tribunal, under Section 129A of the Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose, as sufficient and there is no necessity to produce evidence to prove the usage of the goods for the said purpose and if the appellant company violates the conditions for the usage of the goods, the department can take action under the Customs Act, 1962. However, with evidence it is proved that the said substance is used for non-insecticidal purpose and the burden is to be discharged by the appellant. The self declaration stating that he will use the substance for non-insecticidal is not sufficient and he must satisfactorily explain the method of usage. While it is the allegation of the department against the appellant that if the substance is used as a preservative and also for non-insecticidal purposes, the appellant must prove the non-incidental usage and produce necessary evidences before the authorities. In respect of the other contention of the appellant that if the appellant company violates any of the condition, it is for the authority to take action against the appellant company under the Customs Act, 1962, is not correct. There is no provision under the Customs Act 1962 and the Insecticide Act 1968, to supervise the usage of Bronopol by the appellant company. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5, the appellant company entered into a sales contract with a Chinese supplier namely, Jiangsu Guotai Intl. Group, for supply of 5000 kgs. of Bronopol 99% Min., under the contracted price of USD 22,500. The appellant company paid part payment for the consignment, to the tune of USD 6750, through his banker, on 05.03.2015. The certificate of analysis was issued by the supplier to the appellant. On 16.03.2015 commercial invoices were raised by the supplier and the goods were shipped from Shanghai Port, China to Chennai on 22.03.2015, under Bill of lading No. WP1500904. While the appellant initiated to clear the subject goods, it was not permitted based on the query raised by the first respondent vide his letter dated 08.04.2015 with a direction to produce Central Insecticide Board Registration Certificate. To the query raised by the first respondent, stating that the Classification adopted in the Bill of Entry No.29309099, has not been revised and the same has been accepted by the department itself, in imports of the same material, as the goods are intended for non-insecticidal use; Exemption with respect to licensing of the goods and obtaining registration certificate from Insectici ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other forms of plant of animal life not useful to human beings. (2) The Central Government may by notification in the official gazette and subject to such conditions, if any, as it may specify therein, exempt from all or any of the provisions of this Act or the rules made thereunder, any educational, scientific or research organisation engaged in carrying out experiments with insecticide. So, reading of the aforesaid provision would clearly show that if any substance is imported for non-insecticidal use, the provisions of the Insecticides Act, 1968 will have no application. 16. However, the Notification No. 106/2014/2009-2014 dated 01.01.2015 issued by the Director General of Foreign Trade, reads as follows :- Subject :Amendment in import policy conditions under ITC (HS) 4 digit code 3808. S.O.(E) : In exercise of powers conferred by Section 3 of FT (D R) Act, 1992, read with paragraph 1.3 and 2.1 of the Foreign Trade Policy, 2009-2014, the Central Government hereby inserts the following policy condition as Policy Condition No.3 under Chapter 38 of ITC (HS) 2012 Schedule 1 (Import Policy). 3. Under Section (9) of the Insecticides Act, 1968 all chemica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 330 (Kerala), has been subsequently reversed by the Hon'ble Division Bench of the Kerala High Court, reported in 2015 (330) ELT 924 [Kerala]. In paragraph 16 of the said judgment, it has been held as follows :- 16. From the above cited decisions, we arrive at the following conclusions : An executive instruction or a policy, which is not a statutory document, cannot form the basis for creation of an enforceable legal right. This obviously is based on the principle of law that executive instructions by themselves are ordinarily not enforceable. Such an executive instruction or policy, which could be amended at any time, could not form the basis to claim fundamental right under Article 19(1)(g) of the Act. As far as notification under Section 5 of the Foreign Trade Act is concerned, it is not mere executive instructions, but it is a subordinate legislation and it is law. It can form the basis of a legal right. A person carrying on trade or business in import can complain about the violation of fundamental right to carry on trade or business. After the Foreign Trade Act, the matter is governed on the basis of the notification issued under Section 3 or under Section 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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