2024 (8) TMI 915 - HC - Customs

Seeking provisional release of seized vehicle - fulfilment of policy condition (II)(iii) of Chapter 87, i.e., on arrival of vehicle at the Indian Port but before clearance for home consumption - HELD THAT - It is true that separate policy conditions have been notified for new vehicles and for used vehicles. The condition, which is subject matter of the appeal, came up for consideration before the CESTAT in ANKINEEDU MAGANTI VERSUS COMMISSIONER OF CUSTOMS, COCHIN 2009 (10) TMI 792 - CESTAT BANGALORE which was subsequently upheld by the Hon'ble Kerala High Court in COMMISSIONER OF CUSTOMS VERSUS ANKINEEDU MANGANTI 2010 (5) TMI 654 - KERALA HIGH COURT . The Court held that the type of approval certificate mentioned in the policy condition of Chapter 87 to be issued by the Vehicle Research and Development Establishment (VRDE), Ahmednagar under the Ministry of Defence or at the Automotive Research Association of India (ARAI), Pune was only to ensure that the import of any goods, post clearance, would not be in breach of the essential requirements of law subject to which motor vehicles will be registered for operation on roads. In the case at hand, the CESTAT not only followed the judgment of the Hon'ble Kerala High Court but also noted the factual aspect that the vehicle has already been registered with the competent authority under the Motor Vehicles Act, 1988. If the vehicle did not comply with the stipulations for operation and running on Indian roads, certainly the vehicle would not have been registered under the Motor Vehicles Act, 1988. Thus, no substantial question of law arises - appeal dismissed.

Summary

Issues:
1. Provisional release of a seized vehicle under the Customs Act, 1962.
2. Interpretation of policy conditions for clearance of imported vehicles.
3. Applicability of judgments from other High Courts in customs cases.
4. Compliance with regulatory measures for imported vehicles.

Analysis:
1. The respondent had filed a bill of entry for the clearance of a seized vehicle, which was believed to be liable for confiscation under the Customs Act, 1962. The vehicle was declared as second hand instead of new, leading to a violation of the policy condition under the Customs Tariff Act, 1975.

2. The respondent requested provisional release of the vehicle on payment of duty, which was allowed by the Deputy Commissioner of Customs as per Circular No. 35/2017-Cus. However, the conditions imposed were challenged by the respondent through appeals to various authorities, ultimately reaching the Customs Excise and Service Tax Appellate Tribunal (CESTAT).

3. The CESTAT, following the decision of the High Court of Kerala in a similar case, held that the policy condition requiring testing by specific establishments was redundant. The CESTAT also considered the fact that the vehicle had been registered under the Motor Vehicles Act, 1988, indicating compliance with operational requirements for Indian roads.

4. The High Court, in dismissing the appeal, concurred with the CESTAT's decision and the interpretation of policy conditions. It emphasized the importance of ensuring compliance with regulatory measures for imported goods, particularly vehicles, to meet the essential requirements of law for operation on Indian roads. The Court found no substantial question of law arising from the case, leading to the dismissal of the appeal.