2023 (5) TMI 993 - HC - Customs

Violation of import condition - goods (Raw Petroleum Coke) imported by the respondent admittedly having sulphur content in excess of 7% - in conformity with Indian Standard 17049 or not - import of Raw Petroleum Coke under the CTH 27131100 needs to mandatorily comply with the policy condition or not - provisional release of goods having sulphur content more than 7% - HELD THAT - The Commissioner of Customs, (Appeals) as well as the learned Tribunal has proceeded based upon the ultimate end product which is being manufactured by the respondent. Thus it would be an incorrect manner of examining as to whether the import was provided and whether it satisfies the conditions of licence. Furthermore, the Tribunal opined that no harm will be caused by provisionally releasing the goods - Such a finding, cannot be accepted as the question would be as to whether when admittedly the sulphur content is in excess of 7% will it conform to ISI 7049 as mentioned in the licence and if it does not conform to the said standard is there a violation of the conditions of import. Furthermore, the goods being prohibited item there is a mandatory requirement to comply with the policy condition and the Tribunal was required to examine as to whether there has been any violation of the stipulations under the policy. Before considering as to whether the goods have to be provisionally released when admittedly the sulphur content is more than 7%. Therefore, we are of the view that this question, which is a mixed question of fact and law is required to be decided by the Tribunal before approving the order passed by the Commissioner of Customs (Appeals) granting provisional release. Therefore, the matter requires to be reconsidered by the Tribunal by deciding the referred questions. The order passed by the learned Tribunal is set aside and the matter stands remanded to the learned Tribunal to decide the aforementioned questions and the parties are at liberty to make their submissions before the Tribunal and fresh decision has to be taken on merits and in accordance with law - appeal allowed by way of remand.

Summary

Issues involved:
The issues involved in this judgment are:
1. Whether the dismissal of the appeal by the Learned Tribunal regarding the import of Raw Petroleum Coke with excess sulphur content and non-conformance to Indian Standard 17049 was justified.
2. Whether the direction for provisional release of the goods with sulphur content more than 7% violated the import condition and policy.
3. Whether the direction for provisional release of the goods was contrary to law and the relevant criteria of Indian Standard 17049.
4. Whether the order for provisional release of the goods was sustainable when contrary to the policy condition.

Issue A:
The appeal by the revenue under Section 130 of the Customs Act, 1962, challenged the dismissal of the appeal by the Learned Tribunal regarding the import of Raw Petroleum Coke with excess sulphur content. The revenue contended that the imported goods did not conform to Indian Standard 17049 and violated the import condition.

Issue B:
The direction for the provisional release of the goods with sulphur content more than 7% was questioned by the revenue as violative of the import condition and policy. The import of Raw Petroleum Coke needed to comply with specific policy conditions, and any violation would render the import as prohibited.

Issue C:
The revenue argued that the direction for provisional release of the goods was contrary to law, as the import conditions for Raw Petroleum Coke needed to be complied with by the importer. The Tribunal's decision to release the goods provisionally was considered perverse by the revenue.

Issue D:
The sustainability of the order for provisional release of the goods was challenged by the revenue, citing non-conformance to the policy condition and the relevant criteria of Indian Standard 17049. The Tribunal's decision was questioned based on the prohibited nature of the imported item and the necessity to comply with policy conditions.

The judgment allowed the appeal, setting aside the order passed by the Learned Tribunal and remanding the matter for reconsideration. The Tribunal was directed to decide the questions raised by the revenue regarding the import of Raw Petroleum Coke with excess sulphur content and non-conformance to Indian Standard 17049. The parties were given the opportunity to make submissions before the Tribunal for a fresh decision in accordance with the law.