TMI Blog2021 (9) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... he scope of the Act and the Rules in prescribing a standard for import of goods and in prohibiting import of goods which did not meet the standards. Therefore, it is doubtful, whether in the first place, whether the CRO 2012 is legally sustainable. Even if it is ignored that CRO 2012 was issued beyond the scope of the parent Act and Rules, the Schedule to CRO 2012 covers only printers and plotters at Sl.No.7. It did not cover multi-functional devices. The case of the Revenue is that Ministry of Electronics Information Technology has issued a circular No.1/2019 dt. 02.05.2019 clarifying that multi-functional devices are basically printers with additional features and covered under the category of 'printers and plotters' as notified in the order - the case of the Revenue regarding prohibition of import lies on a shaky ground of circular issued by MeitY which effectively enlarged the scope of entry in the order itself. Confiscation of goods - HELD THAT:- It is undisputed that the goods were second hand in nature and were examined by the Customs under first check and were verified by expert Chartered Engineer and the import duty was recalculated accordingly under CV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 112 (a) by the Commissioner (Appeals) which is fair and reasonable. Appeal dismissed - decided against Revenue. - CUSTOMS APPLICATION No.40077 - 40086 of 2021, Customs Application No. 40089-40098 of 2021, Customs Application No.40100-40120 of 2021 and CUSTOM APPEAL No.40098-40138 of 2021 - FINAL ORDER Nos. 41931-41971 / 2021 - Dated:- 27-8-2021 - Ms. SULEKHA BEEVI C.S, MEMBER (JUDICIAL) and Mr. P. VENKATA SUBBA RAO, MEMBER (TECHNICAL) For the Appellant : Shri S. Balakumar, AC (AR) For the Respondents: 1) Shri N. Viswanathan, Advocate 2) Shri U. Rajaram, Advocate ORDER All these appeals and the stay applications have been filed by the Revenue in respect of the impugned orders as tabulated under :- Sl.No. Appeal No. Stay Application No. Respondent Impugned Order-in- Appeal No. date 1. C/40098/2021 C/S/40077/2021 SP Associates C. Cus.II No.1071-74/2020 dt. 30.12.2020 2. C/40099/2021 C/S/40078/2021 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20. C/40117/2021 C/S/40098/2021 Skylark Office Machines C. Cus.II No.1092- 1095/2020 dt. 31.12.2020 21. C/40118/2021 C/S/40100/2021 -do- -do- 22. C/40119/2021 C/S/40101/2021 -do- -do- 23. C/40120/2021 C/S/40102/2021 -do- -do- 24. C/40121/2021 C/S/40103/2021 Star Copiers C. Cus.II No.1081- 82/2020 dt. 31.12.2020 25. C/40122/2021 C/S/40104/2021 -do- -do- 26. C/40123/2021 C/S/40105/2021 SRK Overseas C. Cus.II No.1080/2020 dt. 30.12.2020 27. C/40124/2021 C/S/40106/2021 Rank Office Automation C. Cus.II No.1083/2020 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondents herein, partly modifying the orders of the adjudicating authorities by : (i) allowing redemption of the confiscated goods under Section 125 of the Customs Act, 1962 on payment of reduced amount of redemption fine (ii) reducing the penalty imposed under Section 112 (a) of Customs Act, 1962; and (iii) setting aside penalty imposed under Section 117 of the Customs Act, 1962. The orders were reviewed by the Committee of Commissioners of Customs and appeals have been filed before this Tribunal along with stay applications. 3. At the outset, Ld. Counsel for the respondents raised a preliminary objection that the stay applications filed under Rule 41 of the CESTAT (Procedure) Rules, 1982 are not maintainable and that this Tribunal does not have the power to grant stay. Rule 41 of the Customs, Central Excise Service Tax Appellate Tribunal (Procedure) Rules, 1982 it reads as under : The Tribunal may make such orders or give such directions as may be necessary or expedient to give effect or in relation to its orders or to prevent abuse of its process or to secure the ends of justice. 4. It has been submitted by the Ld. Counsel for the respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate Tribunal shall, for the purposes of discharging its functions, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely :- (a) discovery and inspection; (b) enforcing the attendance of any person and examining him on oath; (c) compelling the production of books of account and other documents; and (d) issuing commissions. (8) Any proceeding before the Appellate Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purpose of section 196 of the Indian Penal Code (45 of 1860), and the Appellate Tribunal shall be deemed to be a Civil Court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974). 5. It is his submission that Section 129C itself does not empower the Tribunal to stay the order of the lower authority. The only power of the Tribunal was with respect to stay of the requirement of predeposit under Section 129E of the Customs Act prior to 06.08.2014. After 06.08.2014, the amount of predeposit has been statutorily fixed and the Tribunal has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ject to mandatory standards as per BIS for which the importer has neither submitted registration certificate from the BIS nor submitted an exemption letter from the Ministry of Electronics Information Technology [MeitY]. (iv) The import of the goods are restricted under FTP (Para-2.31) and can be imported only against authorization from the DGFT and the importers had not produced such authorization. (v) The importers had deposited the goods in the warehouse pending clearance as per Section 49 of the Customs Act, 1962 which was allowed for a period of 30 days but importer had not applied for or obtained extension of the period to keep the goods in the warehouse. 9. Show cause notices were issued to the importers for violation of the provisions of FTP, Hazardous Waste Rules, E-Waste Rules and Bureau of Indian Standards Act, 1986, proposing confiscation of the goods under Section 111 (d) and 111 (m) of the Customs Act, 1962 and proposing imposition of penalty imposed upon the respondents under Section 112 (a) and Section 117 of the Customs Act, 1962. 10. Meanwhile, some of the importers had filed writ petitions before the Hon'ble High Court of Madras who directed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed appeals on the following grounds :- (i) Commissioner (Appeals) has waived the penalty imposed under Section 117 of the Customs Act, 1962 which is not correct because it is on record that the importers had deposited the goods under Section 49 of the Customs Act, 1962 in the warehouse and had not sought permission to keep them in the warehouse beyond normal period of 30 days. (ii) The Commissioner (Appeals) has relied on the judgement of the Hon'ble Supreme Court in the case of S.L.P. No.17307/2019 in which by an order dt. 18.09.2020 it was held as follows : Considering that the petitioners in the other special leave petitions have had their goods released pursuant to orders of this court, we allow these applications. The goods are to be released on the same terms as have been released in the other cases . The S.L.P is specific to each case and it cannot be followed in similar cases of other appellants and there is no binding effect on other parties. (iii) The Commissioner (Appeals) did not justify the reason for unconditional release of the goods in the absence of a DGFT decision on the subject matter under the provisions of Foreign Trade (Development ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... datory statutory compliance under CRO 2012. The impugned goods are being imported in large quantities since they are not manufactured in India and the intention of the Government seems to restrict in public interest import of second hand multi-functional device without a license. In view of the above, Revenue prayed that Orders-in-Appeal may be set aside by the Tribunal and the Hon'ble Tribunal may pass any order as it may be deem fit. 14. Ld. Counsel for the respondents submits that the main contention of the Revenue is that import of MFDs requires a certificate of compulsory registration by BIS as per CRO 2012. Clause (3) of this order reads as under : 3. Prohibition regarding manufacture, storage, sale and distribution etc. of Goods - (1) No person shall by himself or through any person on his behalf manufacture or store for sale, import, sell or distribute Goods which do not conform to the Specified Standard and do not bear the words Self declaration - Conforming to IS (Relevant Indian Standard mentioned in column (3) of the Schedule) on such Goods after obtaining Registration from the Bureau: 2. The sub-standard or defective Goods which do not conform to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Printers/ Multi- Function Devices (MFD) / Plotters IS 13252 : Part 1 : 2010 Information Technology Equipment - Safety General Requirements The CRO 2012 specifically covers only 'printers and plotters'. The case of the Revenue rests on a circular issued by the Ministry of Information Technology No.1/2019 dt. 02.05.2019 which reads as under : 8(29)/2019-IPHW Government of India Ministry of Electronics and Information Technology, IPHW Division. Dated, 2nd May 2019 CIRCULAR No.1 of 2019 Subject :- Clarification regarding coverage of Multi-Function Devices (MFDs) The Government of India, Ministry of Electronics and Information Technology (MeitY) has mandated Compulsory Registration for notified product categories including Printers, Plotters in the Electronics and IT Goods (Requirement of Compulsory Registration Order, 2012. (hereinafter called the Order) notified in the Gazette of India vide S.O.No.2357 (E) dated 03.10.2012. 2. In this regard, it is clarified that the Multi-Function Devices (MFDs), which are basically printers with additional features like p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epartment is based on DGFT Notification No.5/2015-2020 dt. 07.05.2019 which reads as under : Notification No.5/2015-2020 New Delhi Dated 7 May, 2019 Subject : Import policy for electronics and IT Goods under Schedule I (Import Policy) of ITC (HS), 2017. S.O. (E) : In exercise of powers conferred by Section 3 of FT (D R) Act, 1992 read with paragraph 1.02 and 2.01 of the Foreign Trade Policy, 2015-2020, as amended from time to time, the Central Government hereby amends Note No.2(c) under the General Notes Regarding Import Policy and inserts Policy Condition No.2 under Chapter 84 and as Policy Condition No.5 under Chapter 85 of ITC (HS) 2017 as under : Existing General Note 2 (c) Amended General Note No.2 (c) (c) Import Policy for electronics and IT Goods : The import of Notified Goods under the Electronics and Information Technology Goods (requirement of Compulsory Registration) Order, 2012, as amended from time to time, will be allowed subject to registration with the Bureau of Indian Standards (BIS), or on specific exemption letter from Ministry of Electronics and Information Technology (Mei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Import Policy Conditions, if any Second Hand Capital Goods (a) i. Desktop Computers ii. refurbished / re-conditioned spares of re-furbished parts of Personal Computers / Laptops / Multifunctional print copying machines iii. Air Conditioners iv. Diesel generating sets Restricted Importable against Authorization (b) All electronics and IT Goods notified under the Electronics and IT Goods (Requirement of Compulsory Registration) Order, 2012 as amended from time to time. Restricted (i) Importable against Authorization subject to conditions laid down under Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order, 2012, as amended from time to time. (ii) Import of unregistered / non-complaint notified products as in CRO,2012, as amended from time to time is prohibited . 3. Effect of this Notification : Import Policy and Policy condition for import of Electronics and It Goods is laid down . This i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period. 17. Lastly, the learned counsel prays that a direction may be given to the Revenue to release the goods immediately since they have not been released to them despite order of Commissioner (Appeals). He also prays that an order to waive demurrages may be given to Commissioner. 18. We have gone through records of the case and considered arguments on both sides. The following questions need to be addressed : (1) Whether the multi-functional devices imported by the appellants were required to meet the standards as 'printers / plotters' as per Electronics Information Technology Goods (Requirements of Compulsory Registration) Order 2012 ? (2) Whether the goods were covered by Hazardous Other Wastes (Management and Transboundary Movement) Rules, 2016 ? (3) If they have to meet the standards, was the import of the goods prohibited and were they liable for confiscation under Section 111 (d) of the Customs Act, 1962 ? (4) Whether the import of goods in question was restricted under para 2.31 of FTP ? (5) Was the value declared by the respondents in their Bill of Entry incorrect and whether the revaluation has been done by the Chartered Engine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s From the preamble, it is evident that this order was issued under Section 10 (1) (p) of the Bureau of Indian Standards Act, 1986 and in pursuance of clause (fa) of rule 13 of the Bureau of Indian Standards Rules, 1987. Section 10 of the Bureau of Indian Standards Act, 1986 reads as follows :- 10. Functions of the Bureau .-(1) The Bureau may exercise such powers and perform such duties as may be assigned to it by or under this Act and, in particular, such powers include the power to- (a) ....... (b) ..... ... (p) perform such other functions as may be prescribed. 21. It is pertinent to note that in the entire BIS Act, 1986, there is no provision for regulating imports at all including in Section 10 referred to above. Rule 13 of BIS Rules, 1987 deals with other functions of the Bureau . It reads as follows : 13. Other Functions of the Bureau The Bureau under clause (p) of sub- section (1) of section 10 may also a. formulate, implement and coordinate activities relating to quality maintenance and improvement in products and processes; b. promote harmonious development in standardization, quality systems and certification, an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r consulting the Bureau of Indian Standards, is of the opinion that it is necessary or expedient so to do in the public interest, hereby makes the following Order, namely:- 1. Short Title and commencement : - (1) This Order may be called the ―Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order, 2021 . 2. Compulsory use of standard mark: - Goods or articles specified in the column (2) of the Schedule below shall conform to the corresponding Indian Standard given in the column (3) of the said Schedule and shall bear the 'Standard Mark under a license from the Bureau of Indian Standards as per Scheme-lI of Schedule-II of Bureau of Indian Standards (Conformity Assessment) Regulations, 2018, provided that nothing in the Order shall apply in relation to goods or articles, as specified in the column (2) of the said Schedule meant for export which conform to the specification required by the foreign buyer and to goods or articles, for which the Central Government has issued specific exemption letter based on reasons to be recorded in writing. .... .... .... .. ..... SCHEDULE S.No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - (a) without a Standard Mark, except under a valid licence; or (b) notwithstanding that he has been granted a license, apply a Standard Mark, unless such goods, article, process, system or service conforms to the relevant standard or prescribed essential requirements. (2) No person shall make a public claim, through advertisements, sales promotion leaflets, price lists or the like, that his goods, article, process, system or service conforms to an Indian standard or make such a declaration on the goods or article, without having a valid certificate of conformity or licence from the Bureau or any other authority approved by the Central Government under sub-section (2) of section 16. (3) No person shall use or apply or purport to use or apply in any manner, in the manufacture, distribution, sale, hire, lease or exhibit or offer for sale of any goods, article, process, system or service, or in the title of any patent or in any trade mark or design, a Standard Mark or any colourable imitation thereof, except under a valid licence from the Bureau.'' As may be seen, the BIS Act, 2016 is an advancement of the BIS Act, 1986 and has provided for regulation of im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77 in respect thereof, or in the case of goods under transhipment, with the declaration for transhipment referred to in the proviso to sub-section (1) of section 54. .... (o) any goods exempted, subject to any condition, from duty or any prohibition in respect of the import thereof under this Act or any other law for the time being in force, in respect of which the condition is not observed unless the non-observance of the condition was sanctioned by the proper officer; (4) The case of the Revenue is that the goods are liable for confiscation under Section 111 (d) of the Customs Act, 1962 because of import of the goods was prohibited under the BIS Act, 1986 read with BIS Rules 1987 read with CRO 2012 read with circular and letters issued by MeitY. In our considered view, the MFDs were clearly not covered even in the CRO 2012 whose restriction of imports itself was beyond the scope of BIS Act, 1986 and BIS Rules, 1987. Therefore, confiscation of the goods under Section 111 (d) on this ground is not sustainable and needs to be set aside which we do so. 25. It is undisputed that the goods were second hand in nature and were examined by the Customs under first check an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B of the Schedule-III in respect of import or export of such wastes in accordance with rules 12, 13 and 14 or the wastes other than those specified in Part A or Part B if they possess any of the hazardous characteristics specified in Part C of that Schedule (23) other wastes means wastes specified in Part B and Part D of Schedule III for import or export and includes all such waste generated indigenously within the country; (38) waste means materials that are not products or by-products, for which the generator has no further use for the purposes of production, transformation or consumption. Explanation.- for the purposes of this clause, (i) waste includes the materials that may be generated during, the extraction of raw materials, the processing of raw materials into intermediates and final products, the consumption of final products, and through other human activities and excludes residuals recycled or reused at the place of generation; and (ii) by-product means a material that is not intended to be produced but gets produced in the production process of intended product and is used as such; 27. In this case, the goods in question were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... user having authorisation under these rules from the concerned State Pollution Control Board or can be sent to authorised treatment, storage and disposal facility. It is emphasized that as per Rule 15 (2), the impugned goods, having been imported without the requisite permissions, should be re-exported. Therefore, Commissioner (Appeals) was wrong in allowing clearance after redemption for home consumption. We find that this Rule requires the Customs officer to ensure re-export within 90 days from arrival. In these cases, even the order of the original authorities was passed well beyond the 90 days. For instance, in case of Bill of Entry No.2706447 dt. 4/4/2019, the OIO was passed only on 14/8/2020 well beyond one year. If this Rule 15(2) is applicable to this case, it is the Customs officers who are in violation of the Rule because the Rule places an obligation on the Customs and not the importer. The question is whether the goods in question are other waste and hence covered by the mischief of this Rule. While used MFDs are listed in the Schedule as Other Waste and hence covered by the mischief of these Rules for them to be classified as other waste , they must be waste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny fine in lieu of confiscation of goods is imposed under sub- section (1), the owner of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges payable in respect of such goods. A perusal of this section shows that the adjudicating authority may allow redemption of prohibited goods and shall allow redemption of other goods. There is no bar on allowing redemption in any case. There is no power under this Section to allow redemption imposing same conditions for redemption [Commissioner of Customs Vs HBL Power Systems Ltd. - 2019 (367) ELT 154 (A.P). 31. In view of the above, we find that the Ld. Commissioner (Appeals) is correct in allowing redemption of the goods under Section 125 for home consumption. Hon ble High Court of Telangana A.P. has released identical goods for home consumption in W.P. No.2728 of 2018 observing as follows : As regards the applicability of the Electronics and IT Goods (Requirement for Compulsory Registration) Order (CRO) 2012, the communication dated 06.12.2016 makes it clear that only repaired/refurbished/second hand items, if notified, would require registration. The learned Assistant So ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contravention. A contravention, by definition, implies an act or omission prohibited by law. In this section, there is nothing which requires the importer to do or not to do something. It says that Assistant or Deputy Commissioner of Customs may permit to deposit of goods in a warehouse and the proviso states that the Commissioner can extend the period of storage. The warehouses in question are the Customs bonded warehouses licensed under Chapter IX of the Customs Act. Warehouses are normally meant for people who want to defer payment of duty they can do so by filing warehouse Bill of Entry and transferring the goods to the Customs bonded warehouse. When they clear the goods, they file an ex-bond Bill of Entry and remove the goods on payment of duty. The period for which the goods may remain warehoused under Chapter IX is in Section 61. Sub-section (2) of Section 61 states that if the goods remain warehoused beyond the period of 90 days from the date of which the proper officer has made an order interest shall be payable. Section 71 prohibits anybody from taking out warehoused goods except on clearance for home consumption or export or for removal to another warehouse or as otherwi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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