2023 (3) TMI 901 - AT - Customs

Benefit of exemption - import of PLC Splitter Module - Denial of exemption based on expert opinion given in the test report by the IIT, Delhi - benefit denied on the ground that the goods imported by the appellant did not have lenses and therefore did not meet the criteria of the exemption under the said notification for the item namely, PLC Splitter Module - Mis-declaration of goods - Confiscation of goods. HELD THAT - That from the notification it is clear that the goods, i.e. Microlens and Splitter are only entitled to the benefit of exemption. Though the sample was taken in the presence of the appellant from the consignment imported, however he raised doubts on the veracity of the test report. As per the settled principles of law, the competency of the expert opinion cannot be doubted. The opinion of expert in the field of trade, who deals in those goods cannot be ignored rather due importance has to be given, Commissioner of Customs (Import), Mumbai Vs. Konkan Synthetics Fibres 2012 (3) TMI 273 - SUPREME COURT . Therefore, the expert opinion given in the test report by the IIT, Delhi is not open to challenge. The High Court of Calcutta in Collector of Customs Vs. National insulated Cable Company Limited, 1993 (5) TMI 35 - CALCUTTA HIGH COURT , took the view that the test report of IIT, Kharagpur merits more attention and credibility. As per the facts of the present case, goods imported by the appellant were examined 100% on first check basis and the goods were found as per the invoice and bill of entry. Merely because the appellant sought for duty exemption on the belief that the goods imported by him fall within the scope of the exemption notification and the revenue took the view that the goods imported were not as per the specifications under the notification, it is not a case where goods have been improperly imported or mis-declared so as to confiscate the goods invoking section 111(m) of the Customs Act. Consequently, the appellant was not granted duty exemption and the goods were provisionally released on payment of regular duty. There was no reason for confiscation of goods or redemption fine of Rs. 1,00,000/- or the penalty to be levied under the Customs Act. The justice will be done, if the penalty amount of Rs.9,44,601/- is set aside as no case is made out for penalty under section 112 and 114AA of the Customs Act. Also, there is no reason to confiscate the goods under Section 111(m) and consequently impose the redemption fine. The appeal is disposed of accordingly and the impugned order is modified by upholding the demand of differential duty but setting aside the confiscation, fine and penalty.

Summary

Issues involved:
The issue involved in this case is whether the product declared as "PLC Splitter Module" is entitled to the benefit of duty exemption under a specific notification.

Details of the Judgment:

Issue 1: Examination of Goods and Duty Exemption Eligibility
The appellant filed a bill of entry for clearance of goods declared as "PLC Splitter Module" under the Customs Act, 1962. The goods were examined and found to be as per the invoice and bill of entry. The appellant sought duty exemption under a specific notification for "Microlens and Splitter." However, expert opinions differed on whether the goods contained microlens. The Tribunal held that since the goods were not improperly imported or mis-declared, there was no basis for confiscation or penalty under the Customs Act.

Issue 2: Reliance on Expert Opinions
The appellant obtained expert opinions from both IIT, Delhi and Motilal Nehru National Institute of Technology, Allahabad regarding the presence of microlens in the goods. While the IIT, Delhi report found no microlens, the report from Motilal Nehru National Institute of Technology, Allahabad confirmed its presence. The Tribunal noted the contradiction and suggested that a third expert opinion could have conclusively decided the issue. It was emphasized that the competency of expert opinions in the field of trade should not be doubted.

Issue 3: Penalty and Confiscation
The Tribunal referred to previous judgments where penalties were set aside in cases of conflicting expert opinions. In this case, the Tribunal set aside the penalty amount and modified the impugned order by upholding the demand of differential duty but setting aside the confiscation, fine, and penalty. The decision was made in the interest of justice, considering the differing expert opinions and lack of clarity on the authenticity of the sample tested.

This judgment highlights the importance of expert opinions in determining duty exemption eligibility and emphasizes the need for clarity and consistency in assessing goods for customs purposes.