2005 (6) TMI 319 - AT - Customs

Summary

Issues Involved:
1. Request for re-export of goods.
2. Ownership/title of the goods.
3. Compliance with Section 69 of the Customs Act, 1962.
4. Liability of goods to confiscation under Section 111(o) of the Customs Act, 1962.

Detailed Analysis:

1. Request for Re-export of Goods:
The appellants requested re-export of citric acid supplied from China to M/s. Marsina Enterprises, Thane, which was rejected by the Commissioner of Customs (Import), Nhava Sheva. The rejection was based on the importer's failure to retire documents, make payment to the bank, and take delivery of the goods, resulting in the goods being shifted to a customs bonded warehouse. The adjudicating authority found that the goods had acquired the character of warehoused goods, and export of such goods may not be possible except under the provisions of Section 69 of the Customs Act, 1962. Additionally, the importers objected to the re-export request, and the Directorate of Revenue Intelligence (DRI) found that the importers were non-existent and had diverted duty-free imported goods into the local market for sale, rendering the goods liable to confiscation.

2. Ownership/Title of the Goods:
The adjudicating authority examined various documents, including the bill of lading, customs examination order, and delivery order, which indicated that the original bill of lading was produced by the authorized representative of the importers, M/s. Marsina Enterprises. The goods were then transferred to the customs bonded warehouse in Punjab Conware after customs examination. The authority concluded that the title of the goods lies with the importers, M/s. Marsina Enterprises, and not with the appellants. The appellants' argument that the ownership of the imported goods lies with the suppliers, M/s. Megabytes International Pte. Ltd., was found to lack credibility. The authority referred to the Supreme Court's observations in "Union of India v. Sampat Raj Dugar" to support this conclusion.

3. Compliance with Section 69 of the Customs Act, 1962:
The adjudicating authority noted that the goods had acquired the character of warehoused goods, and export of such goods may not be possible except under the provisions of Section 69 of the Customs Act, 1962. The appellants' submission that the goods had not entered India and could be shipped back to the suppliers was not convincing. The authority also noted the serious objection of the importers to the re-export request.

4. Liability of Goods to Confiscation under Section 111(o) of the Customs Act, 1962:
The adjudicating authority found that the importers were non-existent and had imported various goods duty-free against advance licenses obtained and diverted them into the local market for sale. This rendered the goods liable to confiscation under Section 111(o) of the Customs Act, 1962. In the present case, the goods were originally intended to be cleared against advance licenses, and it was only after the commencement of the DRI investigation that the goods were warehoused, and the advance license details sought to be utilized were struck down. Therefore, the goods, although not yet cleared, were liable to confiscation.

Conclusion:
The appellants' contention that they are entitled to re-export the goods was rejected. The evidence on record established that the appellants did not continue to be the holders of the title to the goods in question, and the title had passed on to the importers, M/s. Marsina Enterprises, who objected to the re-export request. Consequently, the appeal was rejected, and the impugned order was upheld.