2007 (11) TMI 138 - AT - Customs

Cartridges of 22 LR Stinger misdeclared as .22 Savage & 7.62 x 25 Tokarev has been misdeclared as 30 Mauser (7.62 x 25) S&B held that whatever may be the brand of the cartridge so long as the cartridge can be chambered and fired by the specified rifles of specified bores then import is covered by the said para 2.34 of the Policy (Handbook of procedures) no misdeclaration as there is no legal requirement to disclose the brand name confiscation & penalty are set aside

Summary

Issues:
Import of cartridges under specific licence conditions; Alleged misdeclaration of cartridge types; Confiscation and penalty imposition; Interpretation of licence conditions and technical specifications; Clarifications from DGFT and other authorities; Applicability of judicial precedents; Justification for confiscation and penalty imposition.

Analysis:
The case involved the appellant, a licensed dealer for arms and ammunitions, importing cartridges under a licence issued by DGFT. The Customs authorities conducted 100% examination and found discrepancies in the cartridge descriptions compared to the declared ones, leading to confiscation of the cartridges and imposition of a personal penalty. The Commissioner (Appeals) upheld the decision, prompting the present appeal.

The crux of the issue revolved around the interpretation of the licence conditions specified in Para 2.34 of the Handbook of Procedures, 2002-2007. The Revenue contended that the imported cartridges did not match the specific types permitted under the licence, citing differences in brand names and technical specifications. The appellant argued that the discrepancies were due to brand variations and metric equivalents, supported by clarifications from DGFT, Home Ministry, and BPR&D.

The Tribunal analyzed the technical details provided by the authorities, emphasizing that the DGFT's clarifications favored the appellant and were binding on Customs authorities. Reference was made to judicial decisions supporting this interpretation, reinforcing the importability of the cartridges under Para 2.34 of the Policy. The Tribunal highlighted the specific brand names and metric equivalencies in question, asserting that the imported cartridges fell within the permissible scope of the licence conditions.

Regarding the confiscation and penalty imposition, the Tribunal found no justification for the actions taken by the Customs authorities. It noted that the imported cartridges could be chambered and fired from the specified firearms, aligning with the licence requirements. The Tribunal criticized the Assistant Commissioner for disregarding the clarifications and material provided by the appellant, ultimately ruling in favor of setting aside the impugned order and granting relief to the appellant.

In conclusion, the Tribunal overturned the decision, emphasizing the correct interpretation of the licence conditions and technical specifications. The judgment highlighted the importance of adhering to the Policy's provisions and considering expert clarifications in resolving disputes related to importation of cartridges by licensed arms dealers.