TMI Blog2004 (10) TMI 135X X X X Extracts X X X X X X X X Extracts X X X X ..... office premises of the appellants at Anna Nagar, Chennai were searched by the officers of the DRI on 3-6-2003 and documents were recovered under a mahazar. They also recovered certain samples on the same day. Appellants filed Bill of Entry No. 485078, dated 28-4-2003 for the import of 28,702 pieces of goods in two containers giving description as 'Stock Cot' seconds of different descriptions and accordingly classifying the goods under sub-heading 6206 10 90, 6204 22 90, 6207 21 10, 6207 11 00, 6200 91 00 and 6109 10 00 of the Customs Tariff with 25% adv. as effective rate of basic Customs duty for all. The declared value was Rs. 8,18,063/- and the duty payable on the same was Rs. 5,51,713/-. The containers were opened by the Customs officers on 1-5-2003, 3-5-2003 and 9-5-2003. However, no examination report was available on record. Detailed examination of the consignment in the said two containers indicated as under : (a) Container No. PRSU 2216410 contained 23797 pieces of goods (Ready-made garments-seconds) and the total assessable value worked out to Rs. 6,63,285/- and the duty payable worked out Rs. 11,10,402/- (b) Container No. TEXU 2053204 contained 58415 pi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , he has invited our attention to Paras 16 and 18 of the said judgment and pleaded that one of the issues before the Apex Court was whether the Revenue was entitled to exercise the power under Section 111 of the Customs Act in the facts and circumstances of that case where the importer had cleared five consignments of raw silk free of duty subject to the condition that the imported goods after conversion had to be re-exported and it was held that import of the consignment being in contrary to law, the goods were liable to confiscation. He has submitted that plea of re-export was not taken in that case if the goods were allowed to be re-exported after confiscation. He has pleaded that neither the Tribunal nor the Apex Court ever had the occasion to discuss and decide the aspect of re-export. He has further pleaded that the question whether the goods confiscated and allowed to be redeemed could be re-exported was not before the Tribunal and the Supreme Court. The learned Counsel also invited our attention to the judgment of the Hon'ble Supreme Court in the case of Collector of Customs, Bombay v. Elephanta Oil and Industries reported in 2003 (152) E.L.T. 257 (S.C.) where the Deptt. it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods. 5.Shri VTK Nayanar, learned JCDR, appeared on behalf of the Revenue and invited our attention to Para 21 of the impugned order wherein the adjudicating authority has noted that the importer had misdeclared the goods to evade payment of duty. The lower authority has also discussed the judgments of the Hon'ble Supreme Court in the case of UOI v. Sampat Raj Dugar and in the case of C.C., Kolkata v. Grand Prime Ltd. (supra), while holding that in the present case, since the goods are liable for confiscation, re-export of the goods cannot be permitted. He has invited our attention to Para 8 of the judgment of the Supreme Court in the case of Grand Prime Ltd. (supra) wherein the Court has noted that the Customs Act, does not contain any provision regarding re-export of goods. He has also invited our attention to Para 19 of the judgment in the case of Sampat Raj Dugar, wherein the Court has discussed about the title to the goods. He has also relied upon the order of the Tribunal in the case of Escorts Herion Ltd. v. CC, Mumbai reported in 1999 (107) E.L.T. 599 wherein also it is held that there is no provision in the law to permit goods to be re-exported subsequent to their confis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection of the appeal. 6.In counter, the learned Counsel for the appellants has argued that the order of the Tribunal in the case of Sedco Forex International Drilling Co. (supra) is not applicable to the case under consideration. In the present case the goods are still with the custody of the department. He has also invited our attention to the order of this Bench in the case of Liaquat Ali Hameed v. CC, Chennai reported in 2003 (156) E.L.T. 863 wherein re-export of the smuggled goods was allowed on payment of fine and penalty. He, therefore, prayed that consistent with the law laid down by the Tribunal, the Hon'ble High Courts and the Hon'ble Apex Court as cited by him, the appellants may be allowed to re-export the goods. 7.We have carefully considered the rival submissions and gone through the case records and perused the various case laws cited by both the sides. We observe that in the present case, the following facts remain undisputed : (a) There was excess quantity of goods to the extent of 49,910 pieces of garments. (b) The goods were examined on three days viz. 1st May, 3rd May and 9th May, 2003. On 7th May itself, the importer sent message to the sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms Act. This is a clear distinction between Dugar's case and the present case. Therefore, in our view, Dugar's case can be of no help to the respondent No. 1." 8.1.From the above, it is clear that the Hon'ble Apex Court has distinguished the facts in the case of UOI v. Sampat Raj Dugar reported in 1992 (58) E.L.T. 163 (S.C.) from the facts of the Grand Prime case and the Apex Court while doing so has clearly noted that in the case of Sampat Raj Dugar, there was a valid licence and as against that, in the case of Grand Prime Ltd., there was a forgery on the licence which rendered the licence invalid and the import was without a valid licence and was prohibited. Further, the title of the goods in the Sampat Raj Dugar's case was also not passed to the party therein. Further in that case, the Hon'ble Apex Court has held that none of the provisions of Section 111 of the Customs Act, 1962 was attracted, the import being under a valid licence. It would thus be seen that the Hon'ble Apex Court in the Grand Prime Ltd. (supra) was dealing with a situation where there was a forgery and it was in those circumstances that the Apex Court has held that re-export cannot be permitted. Further in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner was entitled to exercise the power under Section 111 of the Act to confiscate the goods, in the context of the facts involved therein, whereas in the present case the question is whether, re-export is permissible in the context of the facts involved and if permitted, duty is payable, in addition to redemption fine and penalty. We note that in the present case as could be seen from the records the appellants immediately on coming to know of excess quantity of shipment of goods by the supplier, had taken up the matter with the supplier and the supplier on realising their mistake had agreed to take back the goods. The bona fide of the appellants that excess quantity was supplied without their knowledge, is thus established. Therefore, the view taken by the adjudicating authority that the appellants have not properly explained the misdeclaration, in our view, is not correct. Therefore, the reliance placed by the Commissioner in the case of Grand Prime Ltd. to reject the request for re-export is not correct as the facts in the present case are clearly distinguishable, as noted above. 9.We have distinguished the case law relied upon by the adjudicating authority as noted above. Now ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -export is allowed redemption fine and penalty are imposable, as held by the Hon'ble Apex Court in the case of CC v. Elephanta Oil Industries reported in 2003 (152) E.L.T. 257 (S.C.). In the case of Escorts Herion Ltd. v. CC, Mumbai reported in 1999 (107) E.L.T. 599 relied upon by the Revenue, the Tribunal while observing that Section 125 of the Act, does not specifically provide that an option may be given to redeem the goods for re-export, in the conclusion portion of para 6 of the said order the Tribunal has clearly held as under : "There is nothing in the law, prohibiting the Collector from re-export of the goods. This long standing practice only simplifies the procedural requirement of a complex and time consuming requirement............" 11.It would thus be seen that the department has been allowing re-export of the imported goods. In the case of Hongkong Polychem Company v. CC, Madras reported in 2003 (162) E.L.T. 1088 relied upon by the Revenue, we find that the facts in that case are distinguishable from the facts of the present case inasmuch as in the cited case, import of the goods was prohibited and apart from that, goods were imported by a fictitious firm and a b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inasmuch as in that case, the question of re-export was not involved. That was a case where hospital equipment was imported and the department found that the hospital has violated the conditions stipulated in the Notification regarding duty free import. Likewise, the facts in the case of Sedco Forex International Drilling Inc. reported in 2001 (135) E.L.T. 625, are distinguishable from the facts of the present case, inasmuch as, in that case, the allegation was that import of the Rig into a designated platform PE on 13-1-1998, without filing a Bill of Entry, constituted contravention of the provisions of Sections 30, 32, 34, 46 and 47 of the Customs Act. In the said case, there was no request for re-export of the goods. In the case of Hemant Bhai R. Patel, reported in 2003 (153) E.L.T. 226 (Tri. - LB), the question posed before the Tribunal was whether redemption fine and penalty can be imposed when re-export is allowed and the reference was answered by the Larger Bench that it is open to the adjudicating authority to impose redemption fine as well as penalty even when permission was granted for re-export. 12.Having distinguished the various case laws relied upon by the Revenue, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted, fine and penalty cannot be imposed. We further note that the East Zonal Bench of the Tribunal in the case of Haidery Tins v. CC (Import), Mumbai reported in 2002 (145) E.L.T. 502 while allowing re-export of goods on payment of fine has set aside the imposition of penalty. Further, the Hon'ble Madras High Court in the case of Sankar Pandi v. UOI reported in 2002 (141) E.L.T. 635 (Mad.) has held that in case of improper importation, redemption fine was not payable and re-export was allowed on payment of penalty. Further, the Tribunal in the case of Guru Ispat Ltd. v. Commissioner reported in 2003 (151) E.L.T. 384 (Tri. - Kolkata) has allowed re-export of goods without payment of redemption fine and penalty when the goods were wrongly shipped by the foreign supplier and there was no mala fide on the part of assessee as they took steps on detection of wrong shipment. The Special Leave Petition filed by the Commissioner in Civil Appeal No. CC 720 of 2003 against the said decision of the Tribunal has been dismissed by the Hon'ble Apex Court as reported in 2003 (157) E.L.T. page A87. In the said case, the Commissioner of Customs, Calcutta allowed the appellants therein to re-export ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere wrong shipment was sent by the foreign supplier, re-export was allowed by the Commissioner on payment of redemption fine of Rs. 6 lakhs and penalty of Rs. 2.5 lakhs. On appeal, the Tribunal while allowing re-export, reduced the redemption fine to a token level of Rs. 25,000/- and penalty imposed was set aside. The plea of the Revenue that even if re-export is allowed, the importer has to pay duty, in addition to redemption fine and penalty, cannot be countenanced, because once duty is paid on the goods, it would tantamount to clearance of the goods for home consumption in terms of Section 47 of the Act and once it is cleared for home consumption, the goods get merged with the mass of the goods in the country. Re-export is permitted in a situation where the importer does not want to clear the goods for home consumption for various reasons and when the goods are permitted to be re-exported, the question of clearance of the goods for home consumption on payment of duty does not arise. Therefore, we are of the considered opinion that duty can be demanded only when the goods are cleared for home consumption and not when they are permitted to be re-exported on payment of fine and pen ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
