2009 (11) TMI 261 - AT - Customs

Confiscation and penalty- The respondents herein presented a bill of entry for assessment and clearance of measuring tapes along with other goods like stethoscope holder and testing pin etc. For the import of measuring tapes registration with the Department of Weights and Measures in accordance with the Standards of Weights and Measures Act 1976 (hereinafter referred to as SWM Act) was required. Since the importer was not so registered the measuring tapes were held to be liable for confiscation. Show-cause notice was waived and personal hearing was granted to the importers by the Additional Commissioner of Customs who held that registration was mandatory for export or import of any weight or measure under Section 47 of the SWM Act. He therefore ordered confiscation under Section 111(d) of the Customs Act 1962 read with Section 47 of the SWM Act 1976 with an option to redeem the goods on payment of a fine of Rs. 80, 000/- along with applicable duty and also imposed a penalty of Rs. 20, 000/- on the importer under Section 112(a) ibid. The Commissioner (Appeals) accepted the contention of the importers that they were neither dealers nor manufacturers and set aside the adjudication order hence this appeal by the Revenue. Held that- Since the importers fall within the definition of dealer under the SWM Act registration is mandatory and since they did not possess a Registration Certificate the Additional Commissioner rightly held that the goods were liable to confiscation and the importers liable to penalty. I therefore set aside the impugned order and allow the appeal.

Summary

Issues:
1. Requirement of registration under the Standards of Weights and Measures Act, 1976 for import of 'measuring tapes'.
2. Confiscation of goods and penalty imposition for non-compliance with registration requirements.
3. Interpretation of the term 'dealer' under the SWM Act.
4. Applicability of registration mandate to importers distributing weights or measures.

Analysis:
1. The case revolved around the necessity of registration under the Standards of Weights and Measures Act, 1976 for the import of 'measuring tapes'. The importers failed to register, leading to the confiscation of the goods and imposition of penalties.

2. The Additional Commissioner of Customs invoked Section 111(d) of the Customs Act, 1962 read with Section 47 of the SWM Act, 1976 to order confiscation of the 'measuring tapes'. A fine of Rs. 80,000/- along with applicable duty was imposed, and a penalty of Rs. 20,000/- was levied under Section 112(a) of the Customs Act, 1962.

3. The interpretation of the term 'dealer' under the SWM Act played a crucial role in the judgment. Section 2(c) of the SWM Act defines a "dealer" as a person engaged in the business of buying, selling, supplying, or distributing weights or measures. Importers distributing such goods fall within the ambit of this definition.

4. Importers, by distributing weights or measures, were categorized as 'dealers' under the SWM Act. As they did not qualify as 'manufacturers' falling under the excluded category, registration was deemed mandatory. The absence of a Registration Certificate rendered the goods liable for confiscation, and the importers subject to penalties.

Conclusion:
The Tribunal upheld the decision of the Additional Commissioner, emphasizing the mandatory registration requirement for importers falling under the definition of 'dealer' as per the Standards of Weights and Measures Act, 1976. The judgment highlighted the importance of compliance with regulatory provisions to avoid confiscation and penalties in cases involving the import of weights and measures.