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2017 (8) TMI 346

ng once noted above, we have gone through the reasons while setting aside the order of confiscation and penalty. The CESTAT has considered the issue of “port clearance” and its procedure, as prescribed under Section 42 (2)(d) read with Section 111(j) of the Customs Act. It is noted that the fact of grant of port clearances, which includes the safeguard and security required for the Custom House were never recalled. The goods were permitted to remove from the customs area, by the concerned officers. The importers and/or their agents or employees cannot be held responsible for removal from the Customs area of the port in such situation. The CESTAT has noted that the “removal” and “clearance” cannot be equated to clear the goods for home consumption under Section 47 of the Customs Act. The permissions to clear the goods would not be in violation of Section 111(j), which is applicable to “removals” and not to the “clearance”. - There is no justification and explanation on record as to why those permissions and clearance were not revoked or set aside. There is no denial to the fact of granting clearances and permissions and release of vessels with goods. There is no case of declara .....

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or home consumption under section 47 of the Customs Act, 1962? b) Whether CESTAT was correct in holding that clearance of the goods on the basis of the port clearance permissions was proper despite the fact that Bills of Entry were filed by importers for home consumption under section 46 of the Customs Act, 1962 for clearance of such goods wherein permissions were statutorily to obtained for clearance of the goods as per the provisions of section 47 of the Customs Act, 1962? c) Whether the CESTAT was correct in treating the goods imported only as foreign vessels, requiring permissions for conversion and port clearance instead of treating them also as imported cargo whereas the importers had imported vessels and had filed Bills of Entry for clearance of the vessels as goods as required under section 46 of the Customs Act, 1962 for the clearance of which the compliance of the provisions of section 47 was a statutory requirement? d) Whether the CESTAT was correct in holding that the confiscation under section 111(j) is not applicable since the section 111(j) deals with permission for removal of the goods while section 47 of the Customs Act, 1962 relates to permission for clearance and .....

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ds were not ordered Out of charge from the proper officer of the Customs. On 20.11.2004, the goods of Bill dated 11.11.2004 of M/s. Boskalis Westminister Middle East were examined on first check and import documents were forwarded to Import Appraising Group for further assessment. 6. On 22.11.2004, M/s. J.M. Baxi requested the Export Department, to issue instructions to convert the vessel 'M.V. Sea Diamond' of Importer M/s. Boskalis Westminister Middle East from Foreign Run to Coastal Run as the Bill dated 11.11.2004 filed at Import Department and processed. On 23rd November, 2004, Importer M/s Boskalis Westminister Middle East cleared the goods as stated, without payment of custom duty and obtaining the Out of charge from the proper officer of the Customs. 7. On 24.11.2004, M/s. J.M. Baxi requested the Export Department to issue instructions to convert the vessel/barge of M/s. Hyundai Heavy Industries from Foreign Run to Coastal Run as the Bill dated 23.11.2004 filed and processed at Import Department of Customs. As stated, the goods of the Bills were not examined on first check. It was examined on 27.11.2004. 8. As stated, on 28.11.2004 M/s. Hyundai Heavy Industries clear .....

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CESTAT order dt.15.12.2005 and judgment was passed. 16. On 22.12.2005, M/s. Hyundai Heavy Industries extended their both Bank Guarantees amounting to ₹ 39.37 crores for another one year i.e. upto 22.12.2006. On 30.12.2005, Misc. Application for Transfer of Bench was filed before CESTAT. 17. On 12.01.2006, this Court dismissed Writ Petition (L) No.3054/2005 as the Tribunal had started the hearing of the main appeals filed by Respondent Nos.1 and 5. On 19.1.2006, Revenue filed Writ Petition Lodging No.119 of 2006 for transfer of Bench of the Tribunal hearing Appeal. On 19.1.2006, hearing was completed by CESTAT of Appeal No.C/1431 & 1465/05Mum. and granted two weeks time to both the parties to file written submissions. On 20.1.2006, this Court dismissed the Writ Petition of the Department as withdrawn since the hearing before CESTAT had been completed. 18. On 03/02/2006, the Department submitted written submissions to the CESTAT. The CESTAT, passed the Common Final Order dated 14.8.2006 wherein the confiscation was set aside. Therefore, on 08/12/2006, a prayer was made to cancel the B.G. of ₹ 39.37 crores. 19. On 13.12.2006, the Customs Appeal was filed by the Depart .....

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t in respect of the same, the proper officer may make an order permitting clearance of the goods for home consumption:...... Section 111. Confiscation of improperly imported goods, etc.( j) any dutiable or prohibited goods removed or attempted to be removed from a customs area or a warehouse without the permission of the proper officer or contrary to the terms of such permission;.... Section 112 (a) Penalty for improper importation of goods, etc.Any person.... (a) who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or....... Reasons in support of operative part of this Judgment: 22. CESTAT, being a statutory Appellate Tribunal of exports, has considered, keeping in mind the provisions of law and the documents so available on record, and so also the background of the transactions. There is no issue that these vessels, barges, self propelled tugs and consumable stores on board, were imported. They were chargeable to the duty, as prescribed. These vessels and barges were imported subject to reexport conditions after the work of conducting high t .....

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accordingly. 24. The question of penalty and other confiscation will come, only if, there is a breach and/or contravention of the basic provisions so raised and referred. The act of release and/or selling of vessels, barges from Mumbai port, just cannot be overlooked especially when every mechanism, machinery and required procedure was available under the provisions and the same were under the control of the concerned authorities. As noted, they have already been cleared the requisite permissions/clearances to the Respondents. There was no issue about the requisite payment so, deposited at the relevant time. 25. A plain reading of these Sections and considering the fact that at the relevant time, and subsequently for the period upto the stage of release, clearances and such removal of the vessel, no way can be stated to be in contravention of any provisions. The relevant time, there was proper compliances from the side of the Respondents, now it cannot be the foundation of misrepresentation. The delay to the assessment by the Appellant's Officers, cannot be the reason for taking such action of seizing and confiscating and imposing of penalty. Admittedly, though there are proce .....

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and/or their agents or employees cannot be held responsible for removal from the Customs area of the port in such situation. The CESTAT has noted that the removal and clearance cannot be equated to clear the goods for home consumption under Section 47 of the Customs Act. The permissions to clear the goods would not be in violation of Section 111(j), which is applicable to removals and not to the clearance . We also endorse these reasons. 28. The CESTAT has noted that even, the no action of appraisal, cannot be a reason to hold the Respondents liable. It is noted that this is not the case of mis-description and of any breach regarding the declaration. The goods were under import. The Appellants were ready with the duty/payment. Once the goods are removed by obtaining port clearance, there was no question of such confiscation under provision of section 111(j) of the Customs Act and of penalty on the Respondents. There was no loss of Duty. This is not a case that Respondents deliberately, by breaching the basic provisions of law, had removed unaccounted goods, without written permissions. The show cause notices itself noted that, all supporting documents, materials and requisite permi .....

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Uniworth Textiles Ltd vs Commissioner of Central Excise, Raipur. 2013 (9) SCC 753, (2013) 288 ELT, 161 The Respondents have paid even the same, after due declaration. Therefore, in the present case, the Department /revenue failed to discharge its burden, as required under the law. There is no case made out of any willful or intent to evade duty to bring in the case of fraud and collusion . There is no case of stated misstatement or suppressing of fact . The impugned order, therefore, needs no interference, even on the ground of stated delayed decision. All the questions of law, therefore, are required to be answered accordingly. 32. Having once recorded the above reasons, the written submissions, based around the action of show cause notice and the related proceedings, even by recording the statement of concerned officers and/or of the Respondents, are of no assistance to interfere with the findings so arrived at by the CESTAT. There is no case of perversity and/or illegality. The oral evidence, cannot override the written permissions/clearances, on record. Therefore, for the reasons recorded above and in addition to the reasons so recorded in the impugned order, we are inclined to .....

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