2005 (6) TMI 493 - AT - Customs

Summary

Issues:
1. Import of Kraft Cheddar Cheese not conforming to PFA Rules, 1955.
2. Provisional release of goods and subsequent actions by Customs authority.
3. Compliance with standards and certifications by the appellant.
4. Applicability of Board's circular dated 25-10-2001.
5. Lack of Show Cause Notice (SCN) for confiscation or penalty imposition.

Analysis:

1. The case involves the import of Kraft Cheddar Cheese that did not conform to the Prevention of Food Adulteration (PFA) Rules, 1955. The samples of cheese were found to be adulterated and misbranded by the Chemical Examiner due to low milk fat content and missing manufacturing details on the label.

2. The Customs authority provisionally released the goods to the appellant, who then sold them in the market. Subsequently, the authority directed the appellant to bring back the goods for further action, including recalling foreign exchange remittance. However, no Show Cause Notice was issued for confiscation or penalty imposition.

3. The appellant contended that they imported the cheese through a trader from the manufacturer in Australia, obtaining certificates regarding manufacturing date and fat content. They argued that the cheese met Kraft standards, supported by tests from accredited laboratories. The Commissioner (Appeals) relied on a circular dated 1-11-2001, which the appellant argued was not applicable to their import in March 2000.

4. The Revenue argued that the processed cheese did not meet PFA Rules and clearance should not be allowed as per the circular of 25-10-2001. However, since the goods were provisionally released before the circular, the Tribunal found that the Customs should have confiscated the goods if non-compliant, rather than directing their return without a proper SCN.

5. Ultimately, the Tribunal set aside the impugned order, noting the absence of an SCN for confiscation or penalty imposition, and the mismatch between the release date of goods and the circular relied upon. The appeal was allowed in favor of the appellant, highlighting the procedural irregularities in the Customs actions.