2006 (11) TMI 71 - AT - Customs

Confiscation And Penalty Alleged that appellant imported Heavy imported Scrap without pre-shipment inspection certificate and accordingly penalty imposed on him - After looking over the fact allegation and penalty were set aside

Summary

Issues:
1. Confiscation of imported consignment of "Heavy Melting Scrap" at Kandla port.
2. Penalty imposed on the importer due to lack of pre-shipment inspection certificate from an authorized agency.

Analysis:
1. The appellant imported four containers of "Heavy Melting Scrap" at Kandla port, leading to the consignment's confiscation and imposition of a penalty. The primary reason for confiscation and penalty was the absence of a pre-shipment inspection certificate from a designated agency, as mandated by DGFT Public Notice No. 16/2004-09 dated 15-10-2004.

2. The appellant presented inspection certificates from Bureau Veritas, Oman, and Bureau Veritas, Mumbai. While Bureau Veritas, Mumbai was an authorized agency, Bureau Veritas, Oman was not. The appellant argued that the Mumbai certificate fulfilled the requirement, citing DGFT Circular No. 19/2004-09 dated 18-2-2005, which clarified that branch offices could issue certificates if they had the necessary facilities. The appellant contended that since the inspection and import occurred before the clarification, it should not apply in this case.

3. The appellant further argued that they should not be held accountable for the arrangement between the Oman and Mumbai offices of Bureau Veritas, emphasizing the need to produce a certificate from an authorized agency only. The SDR contended that the inspection by Bureau Veritas, Oman, an unauthorized agency, rendered the certificate invalid due to the specific authorization required for each inspection office.

4. The appellate tribunal acknowledged that the appellant provided certificates from both the Mumbai and Oman offices of Bureau Veritas, with the Mumbai office being authorized. Considering that the import was covered by an inspection certificate from an authorized agency, the tribunal held that the DGFT clarification of 18-2-2005 did not apply retroactively. As the inspection occurred before the clarification and the consignment had already landed in India, the tribunal found the earlier decision unsustainable, setting it aside and allowing the appeal with any consequential relief for the appellant.