1995 (9) TMI 173 - AT - Customs

Summary

Issues Involved:
1. Jurisdiction of the Collector (Preventive), Ahmedabad.
2. Allegations of unauthorized import of complete machines.
3. Compliance with the Actual User condition.
4. Imposition of penalties on various parties.

Summary:

1. Jurisdiction of the Collector (Preventive), Ahmedabad:
The appellants challenged the jurisdiction of the Collector (Preventive), Ahmedabad, arguing that the goods were imported and cleared from Bombay, making the Collector of Customs at Bombay the competent authority. The Tribunal, however, concluded that the Collector (Preventive), Gujarat, had the authority to investigate, issue show cause notices, and adjudicate upon the subject import, based on a conjunctive reading of Notifications No. 87/84-Cus., 250/83, and 251/83, which conferred the necessary powers.

2. Allegations of Unauthorized Import of Complete Machines:
The appellants contended that they imported components, not complete machines, and produced documentary evidence, including invoices and transport receipts, to support their claim. The Tribunal found that the documentary evidence, which included invoices for local purchases of components and transport receipts, was credible and contradicted the statements of Mr. R.P. Mehta and Mr. M.M. Manglic. The Tribunal held that the allegation of importing complete machines in CKD condition was not established, and the order of confiscation u/s 111(d) was not justified.

3. Compliance with the Actual User Condition:
The Tribunal noted that the basic allegation of importing complete machines was not proven, which undermined the claim that the importers violated the Actual User condition by transferring the machinery directly to customers. The Tribunal found evidence of components being transported to the factory of M/s. R.P. Industries, and concluded that the removal of machines in CKD or SKD condition did not constitute non-compliance with the import condition. Consequently, the order of confiscation u/s 111(o) was set aside.

4. Imposition of Penalties on Various Parties:
Given the Tribunal's findings that the main allegations of unauthorized importation were not sustainable, the penalties imposed on various parties u/s 112 were also deemed unsustainable. The Tribunal emphasized that the case was built primarily on statements, which were contradicted by documentary evidence. The Tribunal set aside the penalties, noting the lack of investigation into the local purchases and the absence of expert evidence to establish the configuration of imported parts into complete machines.

Conclusion:
All appeals were allowed, and the entire order of the Adjudicating Authority was set aside, with consequential relief to follow. The Tribunal highlighted the importance of tangible evidence over statements and the necessity of thorough investigations to support allegations.