2020 (2) TMI 1005 - AT - Customs

Export of studded Jewellery - buyer of Diamonds studded jewellery made complaint against 11 articles (out of total 207 pieces) as not being up to the standard - allegation that benefit of N/N. 158/1995 denied - HELD THAT - At the time of re-import of the 11 items, which have been exported by the appellant vide shipping Bill No. 6815 dated 28.10.2014, the appellants have clearly mentioned that they are re-importing goods which were previously exported in the details it has been provided that the re-import items are weighing 53.280 gms of 11 articles of jewellery which were meant for re-export and every item has a specific mention of its S.No. in previous export shipping bill and invoices. The Bill of Entry has been assessed by the concerned officer on the satisfaction that the goods being re-imported are the same which have been exported by Shipping Bill No. 6815 dated 28.10.2014 and they were part of consignment which were previously exported and covered by the relevant packing list and linvoice. Re-export after repair and resetting - HELD THAT - The shipping bill has been assessed by the concerned Superintendent as well as Deputy Commissioner of Customs, Diggy House, Jaipur on 28.02.2015. The appellants have made a true declaration of the repairs and resetting they have undertaken which resulted into variation in the weight of gold by 3.69 gms and weight of diamond by 0.81 CTS. We find that the concerned officer after having satisfied themselves about the identity of the items have allowed re-export of the imported items which were re-imported. The appellants have not charged anything extra from the importer for re-setting and repair of the goods have been exported after repairs and reconditioning at the same price and sent back to the same buyer. The assessing officer of the export consignment have allowed the export after having satisfied themselves with the identity of export items being same as was re-import - there is no violation of condition No. 3 of S.No. 1 of the Notification No. 158/95 Cus dated 14.11.95 as it only requires the satisfaction of Assistant Commissioner of Customs as regards the identity of goods since the shipping bill for re-export of the imported items have been assessed by the Deputy Commissioner, it is apparent that he is satisfied with the fact that the goods being re-exported are the same which have been re-imported. Since in this case, the variation is only of 3.69 gms in the weight which is very minor variation and otherwise also both the import invoice and export invoice has the photograph of all the concerned 11 items of jewellery and the officer after being satisfied with the identity of goods have allowed the export of the same, there are no justification in confirming the duty on the items imported which were actually have been exported by the appellant - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Customs duty demand for failure to fulfill conditions of Notification No. 158/1995
2. Allegation of difference in weight of re-imported and re-exported items
3. Adjudication by Assistant Commissioner and subsequent appeal to Commissioner (Appeals)
4. Appeal before Appellate Tribunal CESTAT NEW DELHI and decision on the Customs duty demand

Issue 1: Customs duty demand for failure to fulfill conditions of Notification No. 158/1995
The case involved an appellant, a manufacturer exporter of studded jewellery, who exported certain items to a buyer in Switzerland. Subsequently, due to complaints about the quality of some items, the appellant re-imported and re-exported 11 articles after repairs and reconditioning. The Customs Authorities issued a show cause notice alleging a discrepancy in the weight of the re-imported and re-exported items, demanding Customs duty under the Customs Act, 1962. The Assistant Commissioner confirmed most charges but dropped a portion of the duty. The Commissioner (Appeals) set aside confiscation and penalties but upheld the Customs duty demand of ?1,75,009 for failure to fulfill a condition of Notification No. 158/1995.

Issue 2: Allegation of difference in weight of re-imported and re-exported items
The Appellate Tribunal noted that the appellant clearly declared the re-imported goods' details matching the previously exported items. After repairs and reconditioning, the appellant re-exported the items, declaring the changes in weight accurately. The concerned officers assessed the re-imported and re-exported items, satisfying themselves about the items' identity and allowing the re-export. The Tribunal emphasized that minor weight variations due to repairs were expected, and the officers' satisfaction with the items' identity was crucial in determining no violation of the Notification's conditions.

Issue 3: Adjudication by Assistant Commissioner and subsequent appeal to Commissioner (Appeals)
The Assistant Commissioner's Order-in-Original confirmed most charges but reduced the Customs duty demand. The appellant appealed to the Commissioner (Appeals), who set aside penalties and confiscation but upheld the Customs duty demand for non-compliance with a condition of Notification No. 158/1995. The Commissioner (Appeals) found the appellant failed to fulfill the condition, leading to the Customs duty imposition.

Issue 4: Appeal before Appellate Tribunal CESTAT NEW DELHI and decision on the Customs duty demand
The appellant approached the Appellate Tribunal challenging the Customs duty demand. The Tribunal, after considering the facts and declarations made by the appellant during re-import and re-export, concluded that there was no violation of the Notification's conditions. The Tribunal highlighted the officers' satisfaction with the items' identity, the minor weight differences due to repairs, and the lack of justification for imposing duty on items properly re-exported. Consequently, the Tribunal set aside the Commissioner (Appeals)' decision, deeming the Order-in-Appeal devoid of merits and allowing the appeal.

This detailed analysis of the legal judgment highlights the key issues, the sequence of events, and the Tribunal's decision based on the facts and legal provisions involved in the case.