2017 (3) TMI 1195 - AT - Customs

Project import - contravention of Project Import Regulations, 1986 - demand of differential duty - absolute confiscation - Held that - there is absolutely no contravention of Project Import Regulations, 1986 committed by the appellant - the total imports were made of 18 moulds. The 10 moulds were cleared without availing the benefit of Project Import Regulations, the appellant have paid applicable custom duty therefore once the import were not made under Project Import Regulations in respect of 10 moulds, no contravention or violation of Regulation can be alleged in respect of said 10 moulds - As regards remaining 8 moulds, I find that they were cleared under Project Import Regulations against registered contract only after the registration of the said contract, the 8 moulds imported and cleared under Project Import Regulations is absolutely in order - neither any differential duty can be demanded nor the said goods are liable for confiscation - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Duty demand confirmation for 8 moulds under Customs Act, 1986.
2. Confiscation of 18 moulds under Customs Act, 1962.
3. Alleged contravention of Project Import Regulations, 1986.

Analysis:
1. The appeal challenged the Order-in-Original confirming duty demand for 8 moulds under the Customs Act, 1986. The appellant imported 18 plastic moulds under the Project Import Regulations, 1986. Out of these, 10 moulds were imported before contract registration and cleared without availing project import benefit. The remaining 8 moulds were imported after contract registration, claiming the benefit. The appellant argued that no contravention occurred as installation reports and reconciliation statements were submitted. The Tribunal agreed, finding no violation as 10 moulds were not imported under the project, and the 8 moulds were cleared correctly under the project, setting aside the duty demand.

2. The Order-in-Original confiscated the 18 moulds valued at ?2,20,49,390 under the Customs Act, 1962, with a fine imposed in lieu of confiscation. The appellant contended that the 10 moulds not availing project benefit should not be confiscated, and the 8 moulds cleared under the project were rightfully imported. The Tribunal concurred, noting that the 10 moulds were correctly cleared without the benefit, thus not subject to confiscation. The 8 moulds, cleared under the project after contract registration, were found compliant, leading to the order's setting aside and allowing the appeal with consequential relief.

3. The alleged contravention of Project Import Regulations, 1986 was central to the dispute. The appellant argued that no violation occurred as 10 moulds were not imported under the project, and the 8 moulds were cleared correctly under the project. The Tribunal agreed, emphasizing that the imports were in order, with no contravention found. The appellant's compliance with the regulations was confirmed, leading to the impugned order's reversal and the appeal's allowance with consequential relief, resolving the issue of alleged contravention effectively.