2013 (10) TMI 1387 - HC - Customs

Summary

Issues involved: Challenge to notification by DGFT and circular by Deputy Commissioner of Customs regarding importation of Areca Nuts.

Judgment Details:

Challenge to Notification by DGFT:
The petitioner initially challenged the notification by DGFT imposing conditions on the importation of Areca Nuts. The petitioner further contested a circular issued by the Deputy Commissioner of Customs regarding provisional assessment and furnishing of Bank Guarantee. The petitioner argued that the conditions imposed by the circular were contrary to Sections 14, 15, and 18 of the Customs Act, 1962. The respondents justified their actions by stating that goods imported in violation of policy conditions could be considered prohibited goods under Section 2(33) of the Act, subject to confiscation under Section 111 and penalty under Section 112. The petitioner countered by asserting that goods importable with conditions do not fall under the definition of prohibited goods, as per Section 2(33), and therefore, should not attract provisions like Section 111 or 112.

Interpretation of Customs Act:
The Court analyzed the DGFT circular and Customs Authority's subsequent circular fixing the tariff value for Areca Nuts. It emphasized the need to determine whether goods imported without meeting the specified CIF value would be classified as prohibited goods. The Court ruled that until a final decision is made, Customs Authority could conduct provisional assessment under Section 18 without invoking provisions related to prohibited goods under Section 111, 112, or 125. It concluded that imposing conditions for Bank Guarantee and P.D. Bond, as per the circular, was unjustified.

Court's Decision:
As an interim measure, the Court directed Customs Authority to conduct provisional assessment under Sections 14, 15, and 18 without imposing conditions for Bank Guarantee or P.D. Bond, which are requirements under Sections 111, 112, and 125. The Court set deadlines for filing affidavits and scheduled the matter for further proceedings after the Puja Vacation.

This judgment clarifies the interpretation of the Customs Act in relation to the importation of Areca Nuts and emphasizes the distinction between goods subject to policy conditions and prohibited goods under the Act.