2007 (9) TMI 181 - AT - Customs

Import of Music systems under Special import license declaring them as C.D. player Impugned item cost more than US 500 so they can only be imported under a valid specific license Unauthorized import Confiscation fine & penalty sustainable for mis-declaration Appeal allowed by way of remand

Summary

Issues:
Classification of imported goods as Music Systems or CD players under the relevant Import Policy.

Analysis:
The case involved the classification of imported goods by M/s. Kalyani Sharp India Ltd. The goods in question were 288 sets of Sharp Brand Mini Component CD systems with speakers and accessories. The respondents claimed clearance under a Special Import Licence (SIL) against the declaration of compact disk players. However, the Appraising Group considered the goods to be Music Systems due to their features and invoiced value. The Commissioner adjudicated the case and allowed clearance based on the product's characteristics and international standards. The Tribunal, upon review, found that the contrivance imported comprised a CD player, Twin tape deck player, AM/FM tuner, and speakers, which in commercial parlance constituted a Music System with multiple functions. The Tribunal noted that the goods did not meet the specific value requirement for High end audio systems under the relevant Import Policy. The Tribunal disagreed with the Commissioner's reliance on a previous judgment and held that the goods were not covered by the SIL.

The Tribunal determined that the imported goods lacked a valid specific license, rendering their import unauthorized. Consequently, the goods were deemed liable for confiscation under Section 111(d) of the Customs Act, 1962. The Tribunal directed the imposition of a suitable redemption fine under Section 125(1) of the Customs Act, 1962, and held the respondents accountable for penalties under Section 112(a) of the Act. The Tribunal set aside the Commissioner's order and remanded the case for further proceedings in compliance with the law and the Tribunal's observations.

In conclusion, the Tribunal's decision centered on the proper classification of the imported goods as Music Systems rather than CD players under the relevant Import Policy. The Tribunal emphasized the distinction between the functions and value thresholds specified in the policy's appendices, ultimately determining that the goods did not qualify for clearance under the SIL. The Tribunal's ruling highlighted the importance of adhering to specific licensing requirements for the importation of goods and upheld the legal consequences for unauthorized imports under the Customs Act, 1962.