2013 (11) TMI 597 - AT - Customs

Composition of goods imported - Appellant contends that goods imported were not hazardous but can be used for rubber industry - Revenue denied the same on the ground that the goods does not meet the requirement of petroleum based processed oil for rubber industry - Whether goods imported meets specification for use in rubber industry - Held that - Prima facie chemical composition of imported goods as well as legal pleading of the appellant failed to satisfy the requirement of law - Appellant directed to make pre deposit - Stay granted partly.

Issues Involved:
Controversy over composition of imported goods for rubber industry, acceptance of technical report in determining goods' character, consideration of past practices in clearance of similar goods, satisfaction of legal requirements by chemical composition and legal pleading, reduction of penalties under Section 112 of Customs Act, 1962, appeal by Revenue on technical report results, direction for deposit by appellants, cooperation for early hearing, disposal of confiscated goods.

Controversy over Composition of Imported Goods:
The judgment revolves around the dispute regarding the composition of goods imported for use in the rubber industry. The appellant argued that the goods were suitable for the rubber industry despite not meeting the specific requirements for petroleum-based processed oil as per IS:15078:201. On the other hand, Revenue contended that the goods did not meet the necessary standards based on a CRCL report. The Tribunal emphasized the importance of technical reports in determining the nature of goods and concluded that the chemical composition of the imported goods did not meet the legal requirements for use in the rubber industry.

Acceptance of Technical Report in Determining Goods' Character:
The Tribunal highlighted the significance of technical reports in deciding the suitability of imported goods for a specific industry. It emphasized that disregarding a technical report, as in this case, could lead to incorrect conclusions about the nature of the goods. The judgment underscored the need to rely on technical expertise to ascertain the characteristics of imported goods accurately.

Consideration of Past Practices in Clearance of Similar Goods:
The appellant cited past instances where similar goods had been cleared for import, implying a precedent for acceptance. However, Revenue rejected this argument, stating that past errors could not justify current violations. The Tribunal upheld Revenue's stance, emphasizing that compliance with legal requirements and standards was essential, regardless of past practices or precedents.

Satisfaction of Legal Requirements by Chemical Composition and Legal Pleading:
The Tribunal found that both the chemical composition of the imported goods and the legal arguments presented by the appellant were insufficient to meet the necessary legal standards for clearance. Despite the appellant's contentions, the judgment concluded that the goods did not satisfy the requirements for use in the rubber industry, as specified by relevant regulations.

Reduction of Penalties under Section 112 of Customs Act, 1962:
The judgment referenced cases where penalties under Section 112 of the Customs Act, 1962, were initially levied at higher amounts but were reduced by the first appellate authority. The Tribunal questioned why Revenue did not appeal these decisions, especially when the technical report results were favorably considered at the appellate level. This observation raised concerns about the consistency and follow-up actions by Revenue in such cases.

Direction for Deposit by Appellants and Cooperation for Early Hearing:
In light of the overall assessment of the issues and to facilitate a fair hearing for the appellants, the Tribunal directed M/s. Sunint Enterprises Pvt. Ltd. to deposit Rs. 3 lakhs and M/s. Happy International to deposit Rs. 2 lakhs by specific dates. The judgment also highlighted the importance of cooperation for early hearings, with the counsel expressing willingness to expedite the process through timely applications and mentions for quick disposal of the matter.

Disposal of Confiscated Goods:
Considering the confiscation of goods, the Tribunal acknowledged the urgency for early disposal of the matter. While passing the order for compliance and mentioning the hearing date, the Tribunal addressed the concerns raised by the appellant regarding the confiscated goods. The judgment indicated a disposition to examine compliance and issue appropriate orders promptly to address the situation effectively.

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