2018 (7) TMI 277 - AT - Customs

Permission to re-export of goods - mis-declaration of imported goods - rejection of declared value - case of appellant is that the samples were not sent for chemical testing for ascertaining the nature of imported consignments which is mandatory - Held that - It is accepted fact that the imported consignments were declared to be other than waste and scrap of plastic for re-examination and test and samples were also drawn, but according to the Revenue, the samples were not sent for chemical testing for ascertaining the nature of imported consignments being plastic scrap, which is mandatory as per (vii) to Para 27 (2) of the Handbook of Procedures (Vol.1), 1992-97 (Revised Edition March, 1996). In absence of test report from the concerned authority regarding nature of the materials to be scrap, the appeal of appellant is allowed - decided in favor of appellant.

Issues:
1. Valuation of imported goods under Customs Valuation Rules.
2. Confiscation and penalty under Customs Act for mis-declaration.
3. Requirement of import license for specific goods.
4. Re-export of wrongly sent goods.
5. Compliance with import regulations and testing procedures for plastic scrap.

Analysis:

Issue 1: Valuation of imported goods under Customs Valuation Rules
The appellant imported LDPE Granules Off Grade, which were re-assessed at a higher value under Rule 12 of the Customs Valuation Rules. The value was enhanced based on PLATT price to US$ 1115 per M.T. The goods were found to contain plastic granules, plastic dust, plastic block, and silica gel. The authorities concluded that the goods were plastic scrap after inspection.

Issue 2: Confiscation and penalty under Customs Act for mis-declaration
The appellant failed to produce the required import license for plastic waste/scrap, leading to confiscation under Section 111(d) of the Customs Act, 1962. A penalty was imposed under Section 112(a) for mis-declaration. The appellant requested re-export based on supplier's confirmation of wrong goods sent for a different order.

Issue 3: Requirement of import license for specific goods
The appellant's argument relied on DGFT Policy Circulars prohibiting the import of plastic waste/scrap without a license. The absence of the license led to confiscation and penalty. The appellant sought re-export based on the supplier's acknowledgment of the error.

Issue 4: Re-export of wrongly sent goods
The appellant requested re-export of the goods based on supplier confirmation of the error. The adjudicating authority enhanced the value of goods and permitted re-export on payment of a penalty. However, the penalty was not paid, and the goods remained un-reexported.

Issue 5: Compliance with import regulations and testing procedures for plastic scrap
The appellant argued that the imported consignments were not subjected to mandatory chemical testing to ascertain if they were plastic scrap, as required by import regulations. The absence of a test report from the concerned authority regarding the nature of the materials led the Tribunal to allow the appeal, setting aside the impugned order.

In conclusion, the Tribunal allowed the appeal due to the lack of a test report confirming the nature of the imported consignments as plastic scrap. The decision highlighted the importance of complying with import regulations and testing procedures for specific goods, emphasizing the need for proper documentation and adherence to licensing requirements to avoid confiscation and penalties under the Customs Act.

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