2000 (4) TMI 253 - AT - Customs

Summary

Issues:
1. Interpretation of Import Trade Control Policy regarding import of machinery for Gem and Jewellery Industry.
2. Allegation of misrepresentation in obtaining registration with the Gem and Jewellery Export Promotion Council.
3. Confiscation of imported machines and imposition of penalty by the Commissioner.

Issue 1: Interpretation of Import Trade Control Policy
The appellants imported machines for the Gem and Jewellery Industry under Notification No. 159/84. The show cause notice alleged that the appellants, registered as merchant exporters, were not actual users of the machinery as required by the Import Policy. It was further claimed that the goods manufactured on the seized machines were not exported, indicating misrepresentation in obtaining registration. The show cause notice proposed confiscation of the machines under Section 111(d) of the Act and imposition of a penalty.

Issue 2: Allegation of Misrepresentation
The Commissioner's order confiscated the machines, allowing redemption on payment of a fine and imposed a penalty on the importers. The appellants contended that they were indeed actual users of the machines, as evidenced by the panchanama showing the machines in operation at their premises. Despite being registered as merchant exporters, the appellants were engaged in using the imported machines for manufacturing gold chains, indicating their status as actual users. The Customs should have rejected the import claim if they believed the appellants were not actual users, rather than waiting five years to raise the issue.

Issue 3: Confiscation and Penalty Imposition
During the appeal, it was argued that the appellants were, in fact, the actual users of the imported machines, as confirmed by the panchanama and the workers' engagement with the machines. The Tribunal found that the appellants were entitled to the benefit as actual users under the Import Policy. Consequently, the appeal succeeded, and directions were issued for consequential relief, overturning the Commissioner's order of confiscation and penalty imposition.

This judgment delves into the interpretation of the Import Trade Control Policy, addressing allegations of misrepresentation in obtaining registration with the Gem and Jewellery Export Promotion Council and the subsequent confiscation of imported machines with the imposition of a penalty. The Tribunal ultimately ruled in favor of the appellants, determining that they were indeed the actual users of the machinery, despite being registered as merchant exporters. The decision highlights the importance of adhering to the conditions of import policies and the significance of factual evidence in resolving disputes related to importation and usage of machinery in specific industries.