2018 (6) TMI 820 - AT - Customs

Mis-declaration of imported goods - D. C. Defibrillators (DCD) with Standard Accessories - N/N. 21/2002-Cus dated 01.03.2002 - mentioning of wrong serial number of notification - case of Revenue is that the goods has been mis-declared by showing them for internal use whereas on going through the catalogue of the imported goods it was observed that the goods are for external use - demand of Differential duty - Confiscation - Penalty - Held that - It is not in dispute that the imported goods are exempted i.e eligible for concessional rate of duty under the said notification albeit under different serial number than cited by the CHA in Bill of Entry and the Appellant is eligible for the exemption. The wrong serial number of notification mentioned during filling of Bill of Entry was not intended. In such case it was not an intentional act of evading duty. The Commissioner (Appeals) has denied the exemption available to external DCD on the ground that the DEC certificate was not produced at the time of importation of goods - Held that - The identity and nature of goods is not in dispute. Even though assuming that the duty exemption certificate was not produced at the time of clearance due to lapse on the part of the CHA but the fact remains that the appellant are eligible for the exemption which is not in dispute. In such case even if the certificate is produced belatedly, the same cannot be made ground to deny the benefit of exemption to hospital. The appellants are eligible for exemption in terms of Sr. No. 362 of N/N. 21/2002 dated 01.03.2002. Further, there is no ground to confiscate the goods or to impose the penalty - The case is remanded back to the adjudicating authority to extend the benefit under the subject notification and order for differential duty, if any - appeal allowed by way of remand.

Summary

Issues:
1. Mis-declaration of imported goods for internal use.
2. Denial of duty exemption under specific notifications.
3. Imposition of differential duty, penalty, and confiscation of goods.
4. Appeal against denial of exemption and confirmation of differential duty.
5. Eligibility for duty exemption under different notification.

Issue 1: Mis-declaration of imported goods for internal use
The case involved an appellant, a Government hospital, importing D.C. Defibrillators (DCD) with Standard Accessories, claiming exemption under specific notifications. The authorities alleged mis-declaration as the goods were for external use, not covered by the claimed exemption. A show-cause notice (SCN) was issued proposing to deny the exemption, demand differential duty, and confiscate the goods under the Customs Act, 1962.

Issue 2: Denial of duty exemption under specific notifications
The appellant contended that the DCDs imported, even for external use, were covered under a different notification, entitling them to a concessional duty rate. The adjudicating authority denied the exemption, confirmed the differential duty, and imposed penalties under the Customs Act, 1962, leading to an appeal before the Commissioner (Appeals).

Issue 3: Imposition of differential duty, penalty, and confiscation of goods
The Commissioner (Appeals) upheld the order but reduced the penalty. The appellant argued eligibility for exemption under a different notification, citing compliance with conditions and submission of a duty exemption certificate post-clearance. The Tribunal noted the hospital's eligibility for exemption under a specific notification and the unintentional misclassification of goods, leading to the setting aside of the impugned order.

Issue 4: Appeal against denial of exemption and confirmation of differential duty
The appellant's counsel highlighted compliance with conditions for duty exemption under a different serial number of the notification. The Tribunal found the hospital eligible for exemption, despite the delayed submission of the duty exemption certificate, emphasizing that the misclassification was not intentional, and remanded the case to the adjudicating authority.

Issue 5: Eligibility for duty exemption under different notification
The Tribunal, after considering the hospital's nature and services, ruled in favor of the appellant, stating that the hospital was eligible for exemption under a specific notification, and there were no grounds for confiscation or penalties. The impugned order was set aside, and the case was remanded for extending the benefit under the relevant notification and determining any differential duty.

This detailed analysis of the judgment addresses the issues related to mis-declaration, denial of duty exemption, differential duty imposition, appeal against denial, and eligibility for exemption under different notifications, providing a comprehensive understanding of the legal proceedings and the Tribunal's decision.