2009 (3) TMI 465 - HC - Customs

Car Import- Connected appeals are filed against the orders of the Tribunal upholding the order of the Commissioner of Customs (Appeals) lifting the condition imposed by the adjudicating authority against sale of imported car for two years from the date of import. Respondents imported cars claiming TR benefit. However, in the course of adjudication the department found that imported vehicles were not used by the importers for the required minimum period of one year and so much so respondents were not entitled to import under the Transfer of Residence Rules. Held that- importers have not been given TR benefit for imported cars, restriction introduced by adjudicating authority against sale of imported cars for two years was rightly cancelled by Commissioner and re-confirmed by Tribunal.

Summary

Issues: Appeal against the orders of the Tribunal upholding the lifting of conditions imposed by the adjudicating authority against the sale of imported cars for two years from the date of import.

Analysis:
1. Issue of TR Benefit Eligibility: The respondents imported cars claiming TR benefit, but the department found that the imported vehicles were not used for the required minimum period of one year, making them ineligible for TR benefit under the Transfer of Residence Rules. As a result, the TR benefit was declined, and the imported vehicles were confiscated under Section 114D of the Customs Act. The adjudicating officer allowed redemption of the vehicles on payment of duty and redemption fine. However, prohibitory orders against the sale of the vehicles for two years were issued, leading to the appeals against the condition imposed.

2. Applicability of Sale Restriction: The standing counsel for the appellant argued that imported cars are not allowed to be sold for two years, but this condition is typically applicable only to cars imported under TR benefit where the importer enjoyed concessional duty rates. In this case, as the respondents were denied TR benefit for the imported cars and obtained release by paying redemption fine and penalty, the question arose as to the legal basis for introducing a prohibition against the sale of imported cars for two years without TR benefit. The Commissioner and the Tribunal rightly canceled the restriction, as no provision beyond the TR Scheme seemed to authorize such a restriction.

3. Outcome and Dismissal of Appeals: Ultimately, the appeals were dismissed as the restriction against the sale of imported cars for two years was deemed unjustified due to the respondents not availing TR benefit for the imported vehicles. The decision of the Commissioner of Customs (Appeals) was upheld, confirming the cancellation of the condition imposed by the adjudicating authority. No further issues were found to be under consideration in these appeals, leading to their dismissal.

In conclusion, the judgment focused on the eligibility for TR benefit, the legality of imposing sale restrictions on imported cars, and the subsequent dismissal of the appeals based on the absence of TR benefit and the cancellation of the sale restriction condition.