2011 (5) TMI 420 - AT - Customs

Import - Restricted goods which requires special import licence - As per the Hon ble Bombay High Court in the case of Sophisticated Marbles & Granite Industries vs. UOI 2004 -TMI - 46944 - HIGH COURT OF JUDICATURE AT BOMBAY , in a similar set of situation where the imported goods requires special import licence and subsequent to the import, the importer wants to produce the licence, held that the importers who are importing goods without licence and seek to validate the import by obtaining subsequent licence or licences cannot be allowed to take advantage of their own wrong - In view of this decision of the Hon ble High Court, find that the impugned order whereby the Commissioner (Appeals) condoned the condition of licence, is not sustainable. Classification of goods - find that the Commissioner (Appeals) reclassified the goods whereas that issue was already settled by the earlier order-in-appeal vide which the matter was remanded in respect of valuation only - Hence, the impugned order in respect of classification is also not sustainable.

Summary

Issues:
1. Appeal against confiscation of goods for import without special license.
2. Dispute over classification of goods under different tariff headings.

Issue 1: Appeal against Confiscation
The Revenue filed an appeal against an order by the Commissioner (Appeals) confiscating goods imported without a special import license. The Commissioner (Appeals) had initially upheld the confiscation, but later considered allowing the importers to obtain the license retroactively. The Tribunal referred to a previous judgment by the Bombay High Court, stating that importers cannot benefit from their own wrongdoing by seeking to validate imports post-importation. The Tribunal found the Commissioner (Appeals) decision unsustainable and set it aside, restoring the order of the adjudicating authority, thereby allowing the appeal against confiscation of the goods.

Issue 2: Dispute over Classification
The Revenue also contested the reclassification of goods by the Commissioner (Appeals) under Chapter 95 of the Tariff, which covers toys, despite the goods being toothbrushes, wet napkins, and toilet seats. The Tribunal noted that the matter of classification had already been settled in a previous order-in-appeal, which remanded the issue for valuation only. The Tribunal found the reclassification by the Commissioner (Appeals) unsustainable, as the issue had already been decided. Consequently, the Tribunal set aside the impugned order and restored the order passed by the adjudicating authority. The appeal was allowed in favor of the Revenue.

In conclusion, the Appellate Tribunal CESTAT, Mumbai, in this judgment, addressed two main issues related to the appeal against the confiscation of goods imported without a special license and the dispute over the classification of the goods. The Tribunal ruled in favor of the Revenue, setting aside the Commissioner (Appeals) decision in both matters and restoring the orders of the adjudicating authority. The judgment emphasized the principle that importers cannot retroactively validate imports without the required licenses and that reclassification of goods already settled is not sustainable.