TMI Blog2022 (5) TMI 1318X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs(now Commissioner) is duty bound to communicate to the importer to exercise their option either to re-export the goods to the country of origin or allow the Central Government to take possession of it and destroy the same accordingly. Therefore, it is a statutory right available to an importer which cannot be overlooked by the department; the importer should have been allowed to exercise the option to re-export the goods, as prayed for. Also, the principle laid down by this Tribunal in NATHI MAL RUGAN MAL VERSUS COMMISSIONER OF CUSTOMS, NHAVA SHEVA, RAIGAD [ 2018 (11) TMI 99 - CESTAT MUMBAI] relied by the Commissioner in directing absolute confiscation is not applicable to the facts of the present case, for the simple reason that the Tribunal in the said case was confronted with the question whether after allowing redemption of the goods on payment of appropriate fine, the assessee be forced to export the goods only and not allowed to dispose the same in any other manner including clearance for home consumption. In the present case, however, no such situation arose. On the contrary, the Appellant has requested for re-export of the goods. There are no justification in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mination it came to the notice of the Customs Department that the imports were mis-declared being not supported with certificate of the Controller of Drugs and Cosmetics Organization (CDSCO) and also the goods were grossly undervalued. Consequently, the goods were seized for further investigation. On completion of the investigation, show- cause notice was issued to the appellants alleging import of aforesaid goods without valid CDSCO certificate, gross mis- declaration of the value of the goods resulting into short payment of duty. Consequently, differential duty amounting to Rs.99,99,241/- was demanded under Section 28(4) of the Customs Act, 1962, confiscation of the seized goods and penalty was proposed on the appellants, M/s Gallardo Trading Pvt. Ltd. under Section 112(a), 114A of the Customs Act, 1962; also penalty was proposed on other appellants viz. Shri Sunil Yadav, Director, Shri Siddiq Yusuf Merchant and Shri Sandeep Tandekar under Section 112(a)/114A/114AA of the Customs Act, 1962. On adjudication, the learned Commissioner rejected the transaction value and re-determined the assessable value; i) directed absolute confiscation of 2,19,435 pieces valued at Rs.2,06,51,122/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consignment contravenes the provisions of Chapter III of the Drugs Cosmetics Act,1940 or the Rules made thereunder and the contravention is such that it cannot be remedied by the importer, the Collector of Customs shall communicate the report forthwith to the importer, who shall within two months of receiving such communication, re-export the cosmetics so imported and failing such re-export the same shall be handed over to the Central Government who shall cause it to be destroyed. It is the contention of the learned Advocate that in the present case the appellant in exercise of the said option of re-export, requested for re-export to the Commissioner of Customs. The learned Commissioner instead of allowing the re-export directed absolute confiscation of the goods. It is his argument that the order and direction of the learned Commissioner of Customs is not in accordance with of provisions of Drugs and Cosmetics Act and rules made thereunder, hence liable to set aside. 4. It is submitted that the said Drugs and Cosmetics Act and the Rules made thereunder being special enactment dealing with imports of Drugs and cosmetics, hence the same would take precedence over the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng re-export of the confiscated goods, which are allowed to be redeemed, it was observed that the adjudicating authority has the power to impose fine and penalty. It is submitted that the said decision is not rendered in the context of violation of Drugs and Cosmetics Act and Rules made thereunder insisting re-export of the imported goods being in contravention of Chapter III to Drugs and Cosmetics Act, 1940. It is alternatively argued on behalf of the Appellant that in the event it is held that the goods are liable for confiscation and penalty, then re-export of the goods be allowed on imposition of nominal/minimum fine and penalty. Further, arguing for other Appellants Shri Sunil Yadav, Director and Shri Siddiq Yusuf Merchant it is submitted that imposition of penalties on them is too excessive and harsh. It is further submitted that imposition of penalties on Shri Sandip Tandekar, power of attorney holder of the CHA, is unwarranted as not a single piece of evidence is brought on record to establish that the CHA was aware of or having knowledge of the mis-declaration and under valuation of the goods. Also, they were not aware that the entire quantity of cosmetics was not supporte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of fine under Section 125 of the Customs Act, 1962 accordingly confiscated absolutely. In support of his submission, the learned AR referred to the judgment of Hon'ble Madras High Court in the case of ALM Enterprises Vs. Commissioner of Customs (Imports), Chennai 2017 (353) ELT 289 (Mad). and this Tribunal in the case of Dhananjay Balchandra Desai Vs.CC 2020-TIOL- 194-CESTAT-Mum. 8. Heard both sides and perused the records. 9. The principal issue as raised by the Appellants is: whether the request for re-export of the imported cosmetics of 2,19,435 pieces, without CDSCO certificate, and 35,712 pieces with CDSCO certificate be allowed or otherwise. The undisputed facts are that the appellants had filed two Bills of Entry dated 24.09.2018 and 02.04.2018, declaring the products as cosmetics , which on examination were found to be mis-declared in relation to its quantity, value and requirement of valid registration certificate under Drugs and Cosmetics Act,1940 and the Rules made thereunder. Consequently, the available goods were seized. During the course of investigation, the Director and concerned persons in their respective statements before officers of the depa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... produce the relevant rules of Drugs and Cosmetics Rules, 1945: - 129.Registration of cosmetic products imported into the country .- No cosmetic shall be imported into India unless the product is registered under the rules by the licensing authority appointed by the Central Government under rule 21 or by any person to whom such powers may be delegated under rule 22. . 131.Procedure for the import of cosmetics . (1) If the officer appointed at the post of entry by the Central Government has reason to believe that any cosmetic contravenes any of the provisions of the Act or the rules made thereunder he may take sample of the cosmetic from the consignment for inspection. If on examination of the sample defects are noticed the officer shall advise the Collector of Customs for further action to be taken. If the suspected contravention of the provisions of the Act or the Rules is such as may have to be determined by test, the officer shall send the sample to the laboratory established for the purpose for performing such tests. The consignment of the said cosmetic shall be detained till such time that the test report on such sample is r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of Chapter III of the Act or the Rules made thereunder but that the contravention is such that it can be remedied by the importer, the Collector of Customs shall communicate the report forthwith to the importer and permit him to import the cosmetic on his giving an undertaking in writing not to dispose of the cosmetic without the permission of the officer authorised in this behalf by the Central Government. (emp. supp.) 12. In the impugned order, the learned Commissioner, have not considered the above provisions while rejecting re-export of the goods requested by the Appellants following the decision of the Hon'ble Madras High Court in ALM Enterprises and the judgment of this Tribunal in the case of M/s Nathi Mal Rugan Mal Vs. Commissioner of Customs, Nhava Sheva, Raigad 2018 TIOL-3335-CESTAT-Mum. Assailing the findings of the learned Commissioner, it is vehemently argued that the Hon'ble Madras High Court in ALM s Case has no doubt upheld absolute confiscation of the cosmetics, toiletry etc. imported without a valid CDSCO Certificate, but nowhere held that re-export of the imported goods cannot be allowed in the event it is requested by the App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le laid down by this Tribunal in Nathi Mal Rugan Mal s case(supra) relied by the Commissioner in directing absolute confiscation is not applicable to the facts of the present case, for the simple reason that the Tribunal in the said case was confronted with the question whether after allowing redemption of the goods on payment of appropriate fine, the assessee be forced to export the goods only and not allowed to dispose the same in any other manner including clearance for home consumption. In the present case, however, no such situation arose. On the contrary, the Appellant has requested for re-export of the goods. 15. In view of above, we do not find any justification in the impugned order directing absolute confiscation of the imported cosmetics of 2,19,435 pieces, instead of allowing re-export of the same following the procedure laid down under Rule 131(3) of the Drugs and Cosmetics Rules, 1945. The said order of confiscation is set aside and the re-export of 2,19,435 pieces is allowed. 16. Further, in view of the prayer for re-export of the balance 35,712 pieces valued at Rs.20,95,104/- (supported with CDSCO certificate), confiscation is also set aside and the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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