2021 (9) TMI 770 - AT - Customs

Valuation of imported goods - Digital Multi-Function Printers / Devices MFD of various makes and models with standard accessories and attachments - to be classified under Customs Tariff Heading 84433100 or not - rejection of declared value - failure to produce information as per Hazardous Waste Rules, 2016 - allegation that importer has neither submitted registration certificate from the BIS nor submitted an exemption letter from the Ministry of Electronics Information Technology MeitY - restricted goods or not - extension of the period to keep the goods in the warehouse, not applied - warehoused goods is pending clearance - HELD THAT - The issue decided in the case of COMMISSIONER OF CUSTOMS VERSUS M/S S.P ASSOCIATES, ARIHANT ENTERPRISES, EXCEL COPIERS, CITY OFFICE EQUIPMENTS, PHOTOFAX SYSTEMS, SKYLARK OFFICE MACHINES, STAR COPIERS, SRK OVERSEAS, RANK OFFICE AUTOMATION, PRIUS TECHNOLOGIES, GENUINE COPIER SYSTEMS, AMAR ENTERPRISES, ATUL AUTOMATION PVT. LTD., DELHI PHOTOCOPIERS, KUTTY IMPEX, PHOTO FAX SYSTEM, GEE KAY COMPUTERS AND BEST MEGA INTERNATIONAL) 2021 (9) TMI 183 - CESTAT CHENNAI where it was held that The case of the Revenue is that Ministry of Electronics Information Technology has issued a circular No.1/2019 dt. 02.05.2019 clarifying that multi-functional devices are basically printers with additional features and covered under the category of 'printers and plotters' as notified in the order - the case of the Revenue regarding prohibition of import lies on a shaky ground of circular issued by MeitY which effectively enlarged the scope of entry in the order itself. The impugned orders are upheld and appeals filed by Revenue are rejected with consequential relief to the respondents. The impugned goods, if not released already by the Customs, must be cleared for home consumption within 10 days from the date of receipt of copy of this order, if the respondents pay the duty and other dues as per the impugned orders - application disposed off.

Issues Involved:
1. Violation of Customs Valuation Rules, 2007.
2. Non-compliance with Hazardous Waste Rules, 2016.
3. Non-compliance with Bureau of Indian Standards (BIS) registration requirements.
4. Import restrictions under Foreign Trade Policy (FTP) 2015-2020.
5. Improper storage of goods under Section 49 of the Customs Act, 1962.
6. Penalties under Sections 111, 112, and 117 of the Customs Act, 1962.

Detailed Analysis:

1. Violation of Customs Valuation Rules, 2007:
The lower authority found that the values declared by the importers were liable to be rejected under the Customs Valuation Rules, 2007, and the goods needed to be revalued as per the Chartered Engineer’s Certificate. The original authority re-determined the value in terms of Rule 9 of CVR 2007, which was not disputed by either side.

2. Non-compliance with Hazardous Waste Rules, 2016:
The importers failed to produce necessary information as per the Hazardous Waste Rules, 2016. The original authority proposed confiscation of the goods under Section 111 (d) and 111 (o) of the Customs Act, 1962, and imposed penalties under Section 112 (a) and Section 117. However, the Tribunal found that the imported goods were not "waste" as they had residual life and were useful articles, thus not falling under the Hazardous Waste Rules.

3. Non-compliance with Bureau of Indian Standards (BIS) registration requirements:
The imported goods were subject to mandatory standards as per BIS, for which the importers neither submitted a registration certificate from BIS nor an exemption letter from MeitY. The Tribunal noted that the Electronics & Information Technology Goods (Requirement for Compulsory Registration) Order 2012 (CRO 2012) did not cover Multi-Functional Devices (MFDs) and that the circulars and letters issued by MeitY could not take the place of law. Therefore, the goods were not prohibited for import under CRO 2012.

4. Import restrictions under Foreign Trade Policy (FTP) 2015-2020:
The import of the goods was restricted under FTP and could only be imported against authorization from the DGFT, which the importers did not produce. The Tribunal upheld the confiscation of the goods under Section 111 (d) for violation of FTP but allowed redemption of the goods under Section 125 for home consumption.

5. Improper storage of goods under Section 49 of the Customs Act, 1962:
The importers had deposited the goods in the warehouse pending clearance as per Section 49 of the Customs Act, 1962, but had not applied for or obtained an extension of the period to keep the goods in the warehouse. The Tribunal found that Section 49 is an enabling provision and not a prohibiting section, and thus no penalty could be imposed under Section 117 for contravention of Section 49.

6. Penalties under Sections 111, 112, and 117 of the Customs Act, 1962:
The original authority imposed penalties under Section 112 (a) for having rendered the goods liable for confiscation under Section 111 (d) and Section 111 (o), and under Section 117 for non-compliance with procedures under Section 49. The Commissioner (Appeals) reduced the penalties under Section 112 (a) and set aside the penalty under Section 117. The Tribunal found the reduction of penalties fair and reasonable and upheld the decision of the Commissioner (Appeals).

Conclusion:
The Tribunal upheld the impugned orders and rejected the appeals filed by Revenue. The imported goods, if not already released, must be cleared for home consumption within 10 days from the date of receipt of the copy of this order, provided the respondents pay the duty and other dues as per the impugned orders. The stay applications were disposed of accordingly.

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