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2024 (5) TMI 288 - GUJARAT HIGH COURT
Imposition of anti-dumping duty on Metcoke (Metallurgical Code) - Origin from China P.R - liability of interest Interest chargeable on duties - Validity Of Notification No. 69/2000-Customs - Central Government also exempted import of Metcoke by a manufacturer of Pig Iron or Steel using a blast furnace in the said Notification - Whether the anti-dumping duty would be a part of the duty, which is covered by Section 25(1) of the Customs Act or not - HELD THAT:- As per the decision of the Hon’ble Supreme Court in the case of Jaswal Neco Ltd. [2015 (8) TMI 243 - SUPREME COURT], the Central Government has considered the effect of the Notification No. 69/2000 and approved to the fact that such Notification is applicable retrospectively and the manufacturers of Pig Iron, Steel using the blast furnace were not even liable to pay interest as no provisions for levy of interest is provided either in the Customs Act or in the Customs Tariff Act.
Notification No. 75/2003-Customs dated 2nd May 2003, the Notification No. 69/2000 was revoked with effect from 5th May 2004 by extending the anti-dumping duty for another one year and the same was rescinded by Notification No. 22/2004-Customs dated 21st January 2004, on being satisfied, it was necessary in the public interest so to do.
The Hon’ble Supreme Court, in the case of TATA Chemicals Limited (2) vs. Union of India and others [2008 (3) TMI 17 - SUPREME COURT], clarified that the order dated 24th August 2000 passed in TATA Chemicals Ltd (1) vs. Union of India [2000 (8) TMI 1147 - SC ORDER] to the fact that the decision in the case of Saurashtra Chemicals Ltd vs. Union of India [2000 (5) TMI 38 - SC ORDER] was on account of the fact that the relevant aspects were not brought to the notice of the Bench and held that the appeals before the CEGAT were maintainable when the challenge was to the determination made. In view of the above fact that the appeal was maintainable before the CEGAT, the Central Government was, thereafter, justified in passing the impugned Notification No. 69/2000 dated 19th May 2000.
As per above conspectus of law and for the foregoing reasons and the settled legal position that the Central Government is entitled to grant exemption while exercising the powers under the provisions of Section 25(1) of the Customs Act, no interference is called for in the impugned Notification No. 69/2000 dated 19th May 2000 and this petition, to that extent, is, accordingly, dismissed.
As per the interim order passed by this Court, the petitioner is clearing the goods on filing of the undertaking and/or bond, as this petition is dismissed, the interim relief stands vacated forthwith. Therefore, so far as the liability of interest which may accrue, it was submitted by the learned Senior Advocate for the petitioner if this petition is not entertained, then the petitioner may not be saddled with the liability of interest.
Thus, the petitioner would not be liable to pay any interest on the amount of anti-dumping duty, which would be leviable as per the Notification No. 69/2000 dated 19th May 2000 till such levy was revoked by Notification No. 22/2004 with effect from 2004 without any interest.
This petition is, accordingly, disposed of.
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2024 (5) TMI 287 - GUJARAT HIGH COURT
Legality of Not Extending Anti-dumping duty - Imports of the Textured Toughened (Tempered) Glass of Chinese origin - Countervailing duty - Sunset review investigation Notification, allowing hearing to all the interested parties, who all participated in the investigation and submitted their evidence, data etc. - Power of Central Government - Whether or not to accept the recommendations in terms of Section 9A of the Act read with Rule 18 of the Rules - HELD THAT:- It was submitted that on perusal of Section 9A read with Rules stipulates an administrative discretion granted to the Central Government to decide to impose or not to impose antidumping duty. It was submitted that plain reading of Section 9A(1) of the Act gives a discretion to the Central Government as the word “may” is used in both the Act and the Rules and not the word “shall” and therefore, the Central Government may disagree with the final findings and recommendations given by the Designated Authority. It was submitted that there is no jurisdictional error committed by the respondent No. 1 in issuing the impugned Office Memorandum as the said Notification is not issued while exercising quasi-judicial powers, but it is a legislative power to levy the antidumping duty or not and therefore, the decision not to issue a Notification for imposing / continuing the anti-dumping duty by not accepting the recommendations of the Designated Authority in general public interest cannot be the subject matter of the judicial review in this petition. It was submitted that the legal provisions of the Act and the Rules does not provide that the recommendations of the Designated Authority are binding on the Central Government.
It is pertinent to note that the provisions of countervailing duty and the anti-dumping duty are similar in nature and the Notifications under the Act being in quasi-judicial exercise, which are amenable to appeal and the challenge, were held to be subjected to judicial review in the writ jurisdiction also.
In view of the decision of the Division Bench of this Court, wherein it is held that recommendations of the Designated Authority are not binding on the Central Government and therefore, the Central Government would have its own decision after recommendations of the Designated Authority are made available to it in accordance with the statutory procedure. In the facts of the case, the Central Government, after considering the recommendations of the Designated Authority, has taken a decision not to extend the anti-dumping duty, for which, no interference can be made while exercising writ jurisdiction as it would be in the domain of the Central Government to decide as to whether the anti-dumping duty should be continued in the public interest taking into consideration all the various factors.
Thus, this petition, being devoid any merit, is hereby dismissed. Notice is discharged.
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2024 (5) TMI 286 - CESTAT KOLKATA
Valuation of the goods - Smuggling activities - (i) Grey metal powder suspected to be Iridium, (ii) Grey metal powder suspected to be Ruthenium, (iii) Micro SD Memory cards, (iv) Stone beads ('Chaton') and (v) Branded watches - courier company - Quantum of redemption fine - Penalty - HELD THAT:- We find that it is a fact admitted by the appellants that all the four passengers who were intercepted at the Airport were carrying the goods in question and were engaged in the activity of smuggling of the said goods into India without payment of any Customs duties thereon. Further, we observe that Meraj Ahmed was engaged in the activity of transportation of these smuggled goods, as evidenced from the records placed before us.
On going through the valuation adopted by the ld. adjudicating authority in the impugned order, we find that the valuation adopted by the ld. adjudicating authority is through proper analysis of the best value available of the goods seized except Ruthenium wherein in the ‘Remarks’ column it has been stated by the ld. adjudicating authority that “the value of this smuggled goods has been arrived at by adding duty quantum, overhead and profit margin for this very rare and precious smuggled item.”
We are not in agreement with the said observation made by the ld. adjudicating authority in the impugned order. As the quantum of duty along with overheads and profit margin cannot be taken as the ‘value’ of the said goods, Thus, the value of the said goods has to be taken as Rs.3,00,000/- (Rupees Three Lakhs) per kg., which is in the range arrived at by the ld. adjudicating authority i.e., Rs.2.82 lakhs to Rs.3.38 lakhs per kg. Accordingly, the duty has to be re-quantified which is payable by the appellants.
We also find that redemption fine imposed on the appellants for release of the seized goods is justified. The penalties imposed are also found to be justified. In view of this, we do not find any merit on these grounds in the appeals filed by the appellants. Accordingly, the appeals in respect of quantum of redemption fine and imposition of penalties are dismissed.
The ld. Adjudicating authority is directed to re-calculate the duty payable by the appellants, as discussed, if they so desire to get release of the goods.
The appeals are disposed of on the above terms.
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2024 (5) TMI 285 - CESTAT MUMBAI
Classification of the imported goods - ‘Activity trackers’ - ‘rate of duty’ for levy intended by section 12 - enhancement of duty liability - recovery of differential duty - Classification of a product under specific heading or residuary heading - HELD THAT:- In the impugned order, appears to have been influenced by reference to ‘wrist bearable devices’ (otherwise known as smart watches) in several clarifications of Central Board of Indirect Taxes & Customs (CBIC) that enunciated these as corresponding to 8517 6290 of First Schedule to Customs Tariff Act, 1975 to suffice for any article capable of being so worn to be so classified. The enormity of chasm of logic between the design of the ‘activity tracker’ and ‘smart watch’, let alone unquestioned acceptance that ‘smart watch’ is indeed so classifiable, which has not been touched upon in the impugned order demonstrates inadequacy of finding. It is also settled law that a notification giving effect to rate of duty, in whichever manner designed, or prescribing a special procedure cannot substitute for the mandate of the charging section.
Here, the premise that the goods are ‘composite’ should have been followed by selecting the predominating function from among the identified constituents and the description corresponding to each that, along with relevant notes in the chapter and section, would be evaluated for defining the characteristic of the whole taken together without question. That glaring lack precludes us from evaluation of the revised classification as being legal and proper.
It would appear that the rules of engagement for revision in classification as required by the General Rules of Interpretation of the Import Tariff appended to Customs Tariff Act, 1975 and the law as determined by the Hon’ble Supreme Court in HPL Chemicals Ltd v. Commissioner of Central Excise, [2006 (4) TMI 1 - SUPREME COURT] have been observed in their breach. Therefore, it is necessary that the entire dispute should be revisited. To enable that to be done, we set aside the impugned order and remand the matter back to the original authority for a fresh decision on the proposed classification after subjecting it to validation in accordance with law as statutorily enacted and judicially determined.
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2024 (5) TMI 284 - CESTAT AHMEDABAD
Imports Of Marble slabs - Mis-declaration of quantity in the declared goods - demand of duty - Confiscation - Penalty - Validity Of Order-in-original passed without grant of personal hearing - No show cause notice was issued as the appellant had requested in writing - HELD THAT:- We find that the appellant had declared the total quantity measured as per punchnama was more than double the quantity declared. The appellant had declared the total quantity of 2199 Sq. Mtr. whereas as per punchnama, the total quantity found was 4516.031 Sq. Mtr. The business of the appellant is largely based on the method of measurement. The punchnama records that the measurement was taken by Inspector using a measuring tape. The annexure ‘B’ to Punchnama indicates that the measurements have been taken in the unit of Millimetre of length and height. The number of pieces have been counted and from the length height and number of pieces, the total square meter is measured.
The argument of the appellant is that the officers were not experts in measuring marbles as it needs technical expertise. It has been argued that without unloading the slabs, the marble could not have been measured. On the strength of these arguments, learned counsel has sought to discard the annexure-B to the punchnama which contains the measurements of the slabs and the number of units.
In this case no show cause notice was issued as the appellant had requested vide letter dated 02.03.2017 for release of seized goods immediately without issue of show cause notice and without holding personal hearing. The importer had indicated that he is ready to pay up duty, fine and penalty imposed in this regard. Consequently, the order-in-original was passed without grant of personal hearing. We find that the Principal Bench in the case of Vikas Spinners [2000 (11) TMI 196 - CEGAT, COURT NO. IV, NEW DELHI] has observed that once the assessee accepts the objection raised at the time of assessment without demur he cannot later challenge assessment.
Thus, it is seen that the goods were taken by the importer without any protest. The method of measurement was not challenged before clearance of goods.In these circumstances, the impugned order demanding duty, interest and confiscation cannot be faulted. However, the redemption fine is reduced from Rs. 15 lakhs to Rs. 5 lakhs and penalty is reduced from Rs. 2 lakhs to Rs. 50,000/- only.
Appeal is partly allowed in above terms.
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2024 (5) TMI 283 - CESTAT NEW DELHI
Valuation - Export of Carpets and threading bars - Mis-declaration of description and value - Overvaluation - Confiscation of carpets - reduction of FOB value - shortage of quantity of carpets - difference in weight of threading bars - value for synthetic carpets is much lesser than that of woolen carpet - show cause notice not served upon the respondent based on his own request to waive off the issuance of show cause notice and of any opportunity of personal hearing - HELD THAT:- Apparently, the respondent, the proprietor thereof namely Shri Ankit Sehgal while being examined on 30.05.2019 had mentioned him to be the trader who purchase the goods/carpets to export the same. However, he admitted that the description of carpet in the impugned shipping bills was mis-declared. The shortage of quantity of carpets in terms of area was clearly admitted in his subsequent statement dated 10.06.2019. With respect to the difference in weight of threading bars proposed to be exported in the impugned consignment, the said proprietor mentioned that the threading bars were to be exported based on per piece criteria. Hence any difference in weight of the consignment for threading bars is irrelevant for the alleged misdeclaration and undervaluation. In the light of this kind of statement of respondent himself, we proceed to examine the findings goods wise i.e. for carpets and threading bars separately as follows:
Carpets - We observe that commissioner (Appeals) has held that the misdeclaration of description of carpets stands established, hence, the said export goods merit confiscation u/s 113 (one of Act). Accordingly, the confiscation of carpets is upheld. Once based upon the said two reports, the description of carpets is held to be wrong even by Commissioner (Appeals) and the respondent herein have not challenged that part of the impugned order.
The findings that the carpets which were to be exported by the appellant were mis-declared as far as their quality and quantity is concerned are hereby upheld. There is no denial rather it can also be judicially noticed that carpets made out of wool have more value than the carpets made out of synthetic polyester. Once the carpets are proved to not to be purely of wool, the value declared for the carpets wrongly declaring those as woolen carpets cannot be denied to be the overvalue of the consignment of the carpets. The rejection of re-determined value of the carpets is therefore held to be contradictory finding by Commissioner (Appeals).
The value has been rejected also on the ground that the market enquiry cannot be considered in the case of export of goods. Respondent has also relied upon Section 18 of Foreign Exchange Regulation Act but we observe from the record that the market enquiry was conducted in presence of the respondent with his own consent. The said consent has never ever been withdrawn. Secondly, the value arrived in the market survey is in corroboration to the value given by the government testing labs CRCL.
Hence the entire case law as has been relied upon by the Commissioner (Appeals) for rejecting the value of market enquiry is held not applicable to the given set of facts and circumstances of the present case. We hold that the case law has wrongly been quoted while rejecting the re-determined value with respect to carpets. The modification in the Order-in-Original to that effect is therefore ordered to be set aside.
Threading bars - The consignment of threading bars was detained based upon the difference in weight of the containers as was observed at the time of vehement than the one declared in the shipping bills. We observe that the sole contention of respondent is that they have never tried to export threading bars on weight basis. They were exporting the threading bars on piece basis and length basis as is also apparent from the copies of shipping bills placed on record, the threading bars both of M-8/M-10 quality have been valued unit wise. There is no mention of weight of the threading bars in the shipping bills.
Thus, findings with respect to no misdeclaration nor any undervaluation with respect to threading bars has rightly been arrived at by Commissioner (Appeals). The re-determined value for threading bars has rightly been set aside. The confiscation thereof has rightly been set aside. We uphold the impugned order to the said extent.
Thus, the order under challenge is partly set aside i.e. with respect to the reduction of amount of redemption fine and the penalty with respect to carpets. However, the findings with respect to threading bars are confirmed. The appeal is accordingly partly allowed.
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2024 (5) TMI 282 - CESTAT AHMEDABAD
Denial of FTA benefit under Notification 46/2011-Cus - Import of Alkalised Cocoa Powder from Malaysia - Condition of value addition of 35% - Verification of Certificate of Origin - Duty demand - Penalty - HELD THAT:- We find that the benefit of Notification issued under FTA was denied by the Custom only on the ground that there was an intelligence that the value addition of 35% in respect of cocoa powder supplied from Malaysia is not fulfilled however to support this allegation no verification was carried out by the department. However, all the cases made out on the same line have been decided in favour of the assessee by extending the benefit of Notification 46/2011. Therefore, the issue is no longer res-integra.
Since the facts and charges levelled in M/s. BDB Exports Pvt. Ltd Vs. CC [2016 (9) TMI 1087 - CESTAT KOLKATA] and R.S. Industries (Rolling Mills) Ltd. Vs. CCE [2017 (11) TMI 1256 - CESTAT NEW DELHI] in the present case are identical and are directly applicable in the present case. Therefore, following the same, the impugned order is not sustainable. Accordingly, the same is set aside. Appeal is allowed.
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2024 (5) TMI 281 - CESTAT MUMBAI
Cancellation of MEIS scrips - Re- classification of the goods - Export of “Lamda Cyhalothrin Technical” - fine - Interest and penalty - Rejection of the classification as declared by the appellant and for rejecting the MEIS benefits of not only the single shipping bill dated 9.12.2019 but also for the past 53 shipping bills pertaining to earlier exports - Non-application of mind - Powers of customs authorities - HELD THAT:- The amount of penalty on the appellant u/s 114AA in numerical is mentioned as Rs.25,00,000/- but in words its written ‘Rupees twenty eight crores’. This is clear example of non-application of mind and hope the authorities concerned will be more careful while adjudicating or deciding any appeal. We do not propose to draw any inference, adverse or otherwise, about causes of this discrepancy.
As per para/clause 3.19 of the Foreign Trade Policy 2015-20 over-claimed or illegally claimed MEIS benefits alongwith interest is recoverable by the Regional Authorities of DGFT, if the scrip is issued to the Exporter and the same is not utilized for the payment of customs duty. Therefore, in the first place only the DGFT is empowered to cancel or recover the MEIS scrips and that too only if it’s not utilized for payment of customs duty. What the customs authorities are trying to recover from the appellant u/s. 28(4) ibid is MEIS benefits already availed by the appellant during the years 2016-2019 which certainly they cannot do as under the said provision the customs department can recover only the ‘duty’ not levied or not paid or short levied or short paid or erroneously refunded or ‘interest’ not paid, partpaid or erroneously refunded by reason of collusion or willful mis-statement or suppression of facts and not the MEIS benefits and, that, too only on the ground of ineligibility to MEIS. The learned Counsel has also submitted that there is no customs duty liability on export of the impugned product even if the classification is changed and the issue is only about the availability of MEIS benefits to the appellant which we have already made clear.
The role of customs authorities, if at all, may commence only upon presentation of scrips for clearance of exported goods that too in accordance with Notification No. 24/2015-dt. 8.4.2015 issued u/s. 25 of the Customs Act, 1962. Once the scrips are issued and are presented before customs authorities to be debited towards duty liability as assessed, the acceptance thereof is governed by the notification (supra) issued u/s. 25 ibid. This is segregation of jurisdiction, which is implicit in the notification applicable to utilization of scrips on imports of goods. There is, thus, no concurrent jurisdiction over the stages involved between export and import and each stage is governed to the limits of licensing and assessment jurisdiction by the respective statutes.
It is not for the customs authorities to interpret licensing policy or to enforce the same once a valid licence is produced or to dissect the license granted. This function is of the licensing authority. If this bifurcation of function is not adhered to, there is every likelihood of utter confusion. The licensing authority may interpret the policy one way and the customs authorities may take contrary view producing a conflict between the two authorities resulting in harassment to the importer or exporter, as the case may be. It is therefore, that the function of the two authorities which operate in two different spheres must be kept within their proper ambit. If a licence is granted in respect of a particular item by the licensing authority, the customs authority will have no right or power to go beyond the licence and determine the classification or reclassifying the same. It is only the licensing authority who has to determine the said question at the time of granting licence.
The exercise of rejecting the entitlement to the scrip commenced with reclassification of the export goods, for assigning a different tariff item in Schedule to Customs Tariff Act, 1975. The classification of the goods is exclusive to Section 12 of Customs Act, 1962 and that too only for levy of duty. The classification declared by the exporter can be disturbed only by reference to the General Rules for Interpretation of the Export Tariff appended to Customs Tariff Act, 1975. Like undertaking of reclassification for imported goods, it is necessary that the onus of identifying the correct classification as substitute for declared classification rests with the assessing officer/proper officer. Such reclassification is to be undertaken solely for the purpose of conformity with the General Rules for Interpretation and not for any other purpose. Reclassification for any other purpose has no place in adjudication.
Thus, we are of the view that the customs authorities have overstepped its jurisdiction by resorting to re-classification of exported goods and cancelling the MEIS scrips. The same are hereby restored to the appellants. Accordingly the impugned order is set aside and the appeal filed by the Appellant is allowed with consequential relief, if any, in accordance with law.
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2024 (5) TMI 280 - CESTAT NEW DELHI
Revocation of the Customs Broker License - forfeiture of security deposit - Penalty - mis-declaration/undervaluation - failure to apply due diligence in verifying the proper KYC documents and also failed to exercise proper supervision on the functioning of G Card employee - Violation of the provisions of Regulation 10(n) of CBLR and Regulation 13(12) - Whether the appellant had any knowledge or in any manner colluded with the importer - HELD THAT:- In the light of the provisions of Regulation 10(n) and the Circulars, we find that the appellant had obtained the copy of the IEC, GSTIN, PAN card , Aadhaar card and other documents like notarised rent agreement executed between one Harish Gulshan and the proprietor of the importer firm namely, Dhirender Kumar. All these documents show the address of the importer firm. As admitted by G-card holder in his statement, on the basis of the original documents produced by Shri Mahesh Ramji Bhanushali, he tallied the same and finding them to be true processed the clearance of the consignment. Moreover, the G-card holder had acquired knowledge about the past antecedents of the importer where the earlier consignments through other CHAs were cleared and therefore believed the importer to be genuine. Verifying the earlier track record of the importer was a valid step towards discharge of his obligation under the regulations.
Reliance is placed on Perfect Cargo & Logistics Vs. C.C (Airport & General), New Delhi [2020 (12) TMI 649 - CESTAT NEW DELHI], where it was observed that the appellant did obtain two documents and neither the Circular nor the Annexures require any physical verification of the premises. It is not the case of the Department that the documents obtained were forged. Thus, it is not a case where the CB had not obtained the requisite documents or that he did not verify the said documents in discharge of his obligations under the regulations.
We are of the opinion that the appellant has carried out proper due diligence as required under Regulation 10(n) by obtaining all the documents and verifying the same from the originals. Thus the obligation on the part of the CB in terms of Regulation 10(n) stands fulfilled.
According to the learned counsel for the appellant by not keeping any effective supervision on the employees of the firm, at best, it can be viewed as a procedural irregularity. In the statement of Shri Rattan Singh Bisht, he has admitted that he did not monitor the work of his G-card holder and he was not aware of the filing of these bill of entries or the importer. He has provided the G-card holder the dongle and ID for filing the papers on his behalf. Such a conduct on the part of ‘CB’ has led to the violation of regulation 13(12) which requires the ‘CB’ to exercise such supervision that may be necessary to ensure the proper conduct of his employees and in the event of failure to do so, he shall be responsible for all acts or omissions of his employees. We, therefore hold that the ‘CB’ failed to discharge the obligation to supervise his employees in the conduct of the business and thereby violated Regulation 13(12).
The Revenue has not produced any evidence which could connect the appellant with the alleged offence. The facts of the case do not reveal any intention or mens-rea on the part of the CB to act fraudulently. We are, therefore, of the considered view that the appellant cannot be held liable for any mis-declaration of the goods.
CB was not aware of the entire transaction, but on the other hand, he failed to monitor the functioning of his employee and enabled him to operate independently by providing the dongle to him, he acted negligently. The act of negligence, in itself is not so grave so as to justify the revocation of license which is extremely harsh and unjustified in the given circumstances when the license of the appellant was suspended on 04.07.2022 and since then he is deprived of his livelihood. We therefore, set aside the revocation of the CB license, however uphold the forfeiture of security deposit and imposition of penalty.
We therefore conclude, that the ‘CB’ is not guilty of violating the provisions of Regulation 10(n) of CBLR but on his own admission has violated Regulation 13(12) and consequently, the punishment of revocation of license do not survive, however, the punishment of forfeiture of security deposit and penalty of Rs 50,000/- are affirmed.
The impugned order is accordingly modified and the appeal stands partly allowed.
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2024 (5) TMI 212 - DELHI HIGH COURT
Jurisdiction of the Tribunal to entertain the appeal related to duty drawback - confiscation of goods - HELD THAT:- As per the appellant, in terms of Section 129(DD) of the Customs Act, 1962 [“the Act”], the remedy of impugning the order was by way of a Revision to the Central Government and an appeal to the Tribunal was not maintainable. Said position is not disputed by learned counsel for respondent who concedes that in terms of Section 129(DD) of the Act, the remedy was only by way of a Revision and not by way of Appeal to the Tribunal. Learned counsel, however, submits that since the objection was not raised at an appropriate stage, respondent could not approach the Revisional Authority within the time prescribed by the statute. She submits that an opportunity be granted to the respondent to now file a Revision in terms of Section 129(DD) of the Act before the Central Government.
Thus, the impugned order dated 25.05.2023 is set aside. An opportunity is granted to the respondent to prefer a Revision u/s 129(DD) of the Act against the Order-in-Appeal dated 14.10.2022, passed by the Commissioner of Customs (Appeal) within a period of two months from today.
Appeal is disposed of in the above terms.
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2024 (5) TMI 211 - GUJARAT HIGH COURT
Power Of Board for the purposes of facilitation of trade u/s 143AA - Seeking release of the original bill of lading and release of the cargo - Imports of the shipment of Soda Ash Dense (Grade-A) - Payment of the requisite duty - HELD THAT:- None of the conditions prescribed in 143AA of the Act applies to the facts of the present case and, therefore, the Commissioner is not required to take any action under Rule 11(2) of the Rules as prayed by the petitioner. We are of the opinion that dispute is between the petitioner and the Respondent No. 3 for which Commissioner of Customs is not concerned and accordingly the petitioner is required to sort out such disputes with Respondent No. 3 in accordance with law. No interference is required to be made in this petition. The petition being devoid of merits is accordingly dismissed.
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2024 (5) TMI 210 - GUJARAT HIGH COURT
Power of High Court to entertain writ petition - alternative efficacious remedy u/s 129A - time limitation including extended period of limitation - Smuggling of huge quantity of gold into India - Seizure - confiscation - Penalty u/s 112(a) and 112(b) and 114AA read with section 123 of the Customs Act, 1962 (‘the Act’) - Denial of opportunity to cross-examine the witnesses and co-noticees - breach of the principle of natural justice - Whether the petitioners can raise such issue of cross-examination, supply of documents before the appellate authority or not - HELD THAT:- The petitioners have mainly rebutted the preliminary objection raised on behalf of the respondent-authority for entertaining these writ petitions on the ground of having alternative remedy and violation of principle of natural justice as the respondent-authority has not decided the application/request of the petitioners to grant cross-examination of two co-noticee viz. Ms. Nita Parmar and Mr. Rutugna Trivedi and rejected such request in the impugned order. Another ground for preferring these petitions with request to entertain the same is for not supplying the relied upon documents in the pend drive which is according to the petitioner is a basis for passing the impugned order.
The facts of the case are so gross to the effect that the petitioners are involved in smuggling of Gold in contravention of the provision of the Customs Act. Therefore, without going into merits of the case, it would be in the interest of justice to relegate the petitioners to avail the alternative efficacious remedy as held by the Apex Court in case of Assistant Commissioner (CT) LTU v. Glaxo Smith Kline Consumer Health Care Limited[2020 (5) TMI 149 - SUPREME COURT] from time-to-time and to enable the petitioners to raise all the contentions before the appellate authority in the appeal which may be filed by the petitioners. It would be also necessary to mention here that the adjudicating authority had already taken a decision to deny the cross-examination to the petitioners of the co-noticee. Even if the matter is sent back to the adjudication authority, it would be a futile exercise for the adjudicating authority to again pass a separate order rejecting the demand for cross-examination. Therefore, we are of the opinion that such a course would result into an empty formality so as to comply with the principles of natural justice.
Even if the matter is remanded back to the adjudicating authority, there is a fait accompli of rejection of the request of the petitioners as stated by the adjudicating authority in the impugned order and no fruitful purpose would be served except setting aside the order and putting the clock back for such empty formality. If the appellate authority is of the opinion that the cross-examination is required to be given to the petitioners on the basis of the contention which may be raised by the petitioners after considering the observations made by the adjudicating authority in the impugned order, it is for the appellate authority to consider such request by calling for remand report from the adjudicating authority to that extent. However, simply because the right of cross-examination is denied to the petitioners, we are of the opinion that the matter should not be remanded back to the adjudicating authority in the facts of the case which are glaring and resulting into the impugned adjudication order which is liable for challenge before the appellate authority.
Thus, these petitions are not entertained as though it may be maintainable under Article 226 of the Constitution of India with liberty to the petitioners to approach to the appellate-authority. The time spent by the petitioners before this Court be considered as bona fide by the appellate authority if the petitioners file appeals before the appellate authority in accordance with law within four week from today without raising an issue of delay.
Thus, the petitions are disposed of. Notices are discharged. Interim relief stands vacated forthwith.
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2024 (5) TMI 209 - CESTAT AHMEDABAD
Valuation - Assessable value of import vessel - Valuation of revised (reduced) price - Duty demand - HELD THAT:- We find that in the instant case the price was declared on the basis of the first MOA entered between the appellant and the cash buyer wherein it was believed that the LDT of the ship is 10386 MT. However, at the time of import it was found that the LDT of the ship was 10,200 MT. Thus, there was a short fall of approximately 186 MT in the LDT as compared to the originally agreed LDT. Consequently, the price was revised by entering into fresh MOA. The facts regarding the original and fresh MOAs were explained by the learned counsel as already recorded in his submission.
We do not find any merit in the impugned order rejecting the value based on the revised MOAs when the LDT declared in original MOA was found to be different from the actual LDT. In these circumstances, ratio of decisions in Chaudhary Ship Breakers) [2023 (6) TMI 1200 - CESTAT AHMEDABAD] squarely apply. Consequently, demand is set aside and appeal allowed.
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2024 (5) TMI 208 - CESTAT AHMEDABAD
Imports ‘Cyanuric Chloride’ - Rejection of declared value of import - contemporaneous import - Revenue not produced the necessary documents - HELD THAT:- We find that the Revenue has failed to fulfil the requirement of producing evidence of contemporaneous import. The basis of rejection of declared value and revision thereof is contemporaneous import. The Revenue does not seem to have the said evidence of contemporaneous import as they have failed to produce despite large number of opportunities. In that circumstances the appeal has to be allowed.
The appeal is allowed with consequential relief.
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2024 (5) TMI 145 - CESTAT AHMEDABAD
Demand of custom duty and imposition of penalty - non payment of duty on slop/waste Oil of foreign origin - cleaning the inner walls of the tanker by applying water with the help of a pressure jet - HELD THAT:- The oil obtained by cleaning the tanker is pre- dominantly mixed with water. Only approximately 10% is oil and 90% is water. In this position, the waste oil/slop oil cannot be classified as crude oil under heading 2710 in terms of chapter note 3 of chapter 27 which prescribes that the petroleum product should contain more than 50% by weight of benzene, toluene, xylene or naphthalene whereas in the present case the oil content is only 10% and 90 is water, therefore demanding duty considering that product as crude oil is not correct.
Without prejudice to above, we further find that it is admitted fact that while converting the vessel from foreign going to coastal run, the custom duty of Rs. 6,95,546/- was paid in regard of the entire quantity of foreign origin oil irrespective whether the subsequently same would be cleaned from the inner walls of the tank by applying water through pressure jet or collected in form of waste/ slop oil from the vessels for clearance , therefore, no custom duty can be demanded for the second time. On this fact, on the waste oil/slop oil duty cannot be demanded twice as the same goods have already suffered the custom duty while converting from foreign going vessels to coastal vessels. Accordingly, we are of the view that in the present case the demand of custom duty, interest and penalty are not sustainable.
Hence, the impugned order is set aside. Appeal is allowed.
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2024 (5) TMI 144 - CESTAT AHMEDABAD
Import of Alkalised Cocoa Powder from Malaysia - Denied FTA benefit of Notification No. 46/2011-Cus - Certificate of origin - wrongly availing custom duty benefit - differential duty - Penalty - HELD THAT:- We find that the benefit of Notification issued under FTA was denied by the Custom only on the ground that there was an intelligence that the condition of value addition of 35% in respect of cocoa powder supplied from Malaysia is not fulfilled however to support this allegation no verification was carried out by the department.
Since the facts and charges levelled in those cases and in the present case are identical, the ratio in the Shriazee Traders [2024 (1) TMI 781 - CESTAT AHMEDABAD] and M/s. BDB Exports Pvt. Ltd Vs. CC [2016 (9) TMI 1087 - CESTAT KOLKATA] are directly applicable in the present case. Therefore, following the same in the present case also, the impugned orders are not sustainable. Accordingly, the same is set aside. Appeal is allowed.
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2024 (5) TMI 143 - CESTAT BANGALORE
Levy of Penalty u/s 112 (a) and (b) and 114AA of the Customs Act, 1962 - Abetment in mis-declaration of goods and evasion of duty - imported items declaring them as sunglasses but on investigation, it was found to be readymade garments - Dummy IECS - The appellants were accused of being involved in a scheme using dummy Import Export Codes (IECs) - Stolen identity - Documents of ‘H-cardholder’ working for the Customs House Agent (CHA) used for carrying out illegal importation of goods - Denial of cross-examination of witnesses - violation of natural justice - Difference Of Opinion between learned members - Third Member Order -
Whether the evidence relied by the adjudicating authority regarding the WhatsApp messages retrieved during investigation can be considered as admissible evidence in view of the provisions u/s 138(c) of the Customs Act, 1962 read with Section 65(B) of the Evidence Act, 1872.
Whether the confession statement of first appellant u/s 108 of the Customs Act, 1962 which stood retracted is substantially corroborated by other independent and cogent evidences to sustain the allegation against first appellant.
Whether the findings of the adjudicating authority regarding role of second appellant in illegal import is sustainable considering the fact that during investigation, in spite of appearing before the investigating officer, no statement is recorded from the second appellant u/s 108 of the Customs Ac, 1962.
ORDER [Per : Ms. Sulekha Beevi. C.S] - HELD THAT:- Undisputedly, the WhatsApp messages have not been retrieved by complying the provisions of Section 138C of the Customs Act, 1962. The Tribunal in the case of Commissioner of Customs, Lucknow Vs Sanjay Soni [2022 (3) TMI 367 - CESTAT ALLAHABAD] had occasion to consider the admissibility of evidence in the nature of WhatsApp messages. It was held that messages retrieved from phone is not reliable or admissible in evidence if provisions of Section 138C of Customs Act, 1962 are not complied. Section 138C is pari materia to Section 36B of Central Excise Act, 1944. While analysing the issue of admissibility of evidence retrieved from electronic items, the Hon’ble Supreme Court in the case of Anwar PV Vs P.K. Basheer & Others [2014 (9) TMI 1007 - SUPREME COURT] had held that the compliance of conditions in Section 138C is mandatory.
Similar view was taken in the case of S.N. Agrotech Vs Commissioner of Customs, [2018 (4) TMI 856 - CESTAT NEW DELHI]. In a recent decision, the Mumbai Bench of the Tribunal in the case of M/s. Jeen Bhavani International Vs CC,[2022 (8) TMI 237 - CESTAT MUMBAI] had occasion to analyse similar issue and held that without complying with conditions of Section 138C of Customs Act, 1962, the contents retrieved from electronic items are not admissible in evidence. The evidence in the nature WhatsApp retrieved from phones cannot be considered in evidence without complying the provisions u/s 138C. The law contained in Section 36B of Central Excise Act, 1944, as well as Section 138C of Customs Act, 1962 are safeguards against arbitrary actions for the reason that it is very easy to fabricate or tamper with material contained in electronic items.
Though the statement recorded before the Customs Officer may be admissible in evidence, it has to be noted that in the present case all the noticees have retracted their statements at the earliest. Further, the statement of Sahil Moiz Zafar was not recorded at all. Even though he is a co-noticee the said appellant has been implicated on the basis of call records and the statement of other noticees. When the noticees have retracted their statement it was incumbent upon the adjudicating authority to allow cross examination when requested for by the appellants. The rejection of the request for cross examination has caused prejudice to the appellants as they were not able to bring out the credibility of the witnesses and statements recorded before Customs Officers.
The evidence in the nature of WhatsApp messages, call records cannot be relied in evidence unless the conditions u/s 138C of Customs Act, 1962 are followed. So also, the denial of cross examination has taken away the right from the appellant to establish their defence. Therefore, there is no independent corroborative evidence. In absence of independent corroborative evidence, the statement which has been retracted cannot be the sole basis to sustain the penalties against either of the appellants.
It has to be noted that in spite of appearing before the investigating officer no statement was recorded from him. The statement of the co-noticees having been retracted and cross examination of all other witnesses been denied, there is absolutely no evidence to uphold the confirmation of penalty on second appellant.
Thus, I agree with all the four points of difference as recorded by Member (Judicial).
Per R. BHAGYA DEVI : - Penalties imposed on Shri Dharaneesh Raju Shetty and Shri Shail Moiz Zafar is upheld. Accordingly, the impugned order is upheld and the appeals are dismissed.
Per: P. A. AUGUSTIAN - No presumption can be drawn that evidences brought on record by way of confession which stood retracted is substantially corroborated by other independent and cogent evidences. Thus, appeals are allowed. Penalty imposed on appellants are set aside.
MAJORITY ORDER - In view of the majority opinion, the penalties imposed on the appellants are set aside. Consequently, the impugned order is set aside and the appeals are allowed.
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2024 (5) TMI 142 - CESTAT CHENNAI
Misdeclaration in the quantity of goods imported - enhancement of the value - Transaction value - demand of duty - confiscation - Penalty - value enhanced by merely relying on NIDB data without supplying details to the appellant - No reasons stated in the order for rejection of the transaction value - whether there are sufficient grounds for rejection of transaction value, enhancement of value of goods - HELD THAT:- There is no discussion as to the details of the Bills of Entry which have been relied by the adjudicating authority. The place of import, the foreign supplier, quantity of the goods, the nature of the goods imported etc., would affect the value of the goods imported. These details are to be discussed by the adjudicating authority as well as the Commissioner (Appeals) to hold that there are sufficient grounds to reject the transaction value and for enhancing the value of the goods. We do not see such discussions either in the order passed by the adjudicating authority or the Commissioner (Appeals). Thus, we find that the enhancement of the value of goods cannot be sustained and requires to be set aside. Order accordingly.
On perusal of the records it is seen that in the bill of entry, packing list as well as other documents the quantity is declared in kilograms. However, payment of duty is on the basis of measurement in meters. On examination it was found that instead of 11,815 kilograms as declared by appellant, the total quantity imported is 11,900 kilograms. We note that the said difference in quantity is too low so as to allege intentional misdeclaration of the goods. There will be some variation in the quantity during the voyage of the goods. Taking into consideration these aspects as put forth by the Ld. Counsel for appellant, we hold that the allegation of mis-declaration of the goods cannot sustain. Consequently, the Redemption fine and penalty imposed are set aside.
In the result, the impugned order is set aside. The appeal is allowed with consequential relief if any.
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2024 (5) TMI 141 - CESTAT CHENNAI
Maintainability of appeal - non-prosecution of the case - matter adjourned beyond three times - Refund claim - rejection of appeal for non-compliance and non-replying to the ‘Deficiency Memo’ - HELD THAT:- Now before us the Appellant has not shown any urgency in having the matter heard and disposed of. Adjournments can’t be given for the mere asking without any serious reason backed with proof for non-appearance of the Appellant or his authorised representative.
Considering the statutory position and the views expressed by the Hon’ble Apex Court in the various judgments cited above, we find that no purpose would be served in continuing with this appeal and hence reject the same for default as per Rule 20 of CESTAT (Procedure) Rules, 1982. The appeal is disposed of accordingly.
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2024 (5) TMI 83 - DELHI HIGH COURT
Seeking grant of permission to export of rice - Non-fulfilment of the conditions entitling it to an exemption - Notifications for imposition of ban on export of non-basmati white rice - export of ‘Non-Basmati white rice’ was changed from ‘free’ to ‘prohibited’ with immediate effect - Whether the Appellant ought to be allowed to export 11,000 MT quantity of rice which is lying at private warehouses near the customs port at Kandla, Gujarat, on the test of substantial compliance of the conditions of exemption - HELD THAT:- It is the case of the Appellant, that despite best of its efforts and due to no fault of it, the quantity of 11,000 MT could not be handed over to the Custodian at Deendayal Port Authority prior to 20th July, 2023, due to lack of storage space at the Port, as evidenced by letter dated 2nd August, 2023, issued by the Custodian. In addition, the Appellant contends that the vessel call number was allocated to it prior to the Notification and the non-berthing of the vessel before 20th July, 2023, was beyond its control. It is, thus, the case of the Appellant that in its facts though it could have otherwise fallen within the exception of Paragraphs 2(ii) and (iii) of the Notifications, entitling it to export 11,000 MT, it was unable to strictly complete the conditions despite all actions taken at its end, due to the circumstances beyond its control.
It is noted that the Appellant initially in the writ petition and in the present appeal pleaded that despite best efforts it was unable to comply with condition no. (v) of Paragraph 2 with respect to payment of export duty on ten shipping bills for 10,000 MT, despite filing the same on to the Portal (ICEGATE) of the Respondent. The Appellant’s averment itself is vague. However, the Respondent in the counter affidavit at Paragraph 21 and 22 as well as in this appeal vehemently opposed the said allegation and asserted that the Appellant was making an incorrect statement. The Appellant asserted that its Portal ICEGATE was fully functional and there was no hindrance to any exporter (including the Appellant) in making payments of export duty within the stipulated period. The Appellant herein has since abandoned the said plea and not relied upon the same in its written submissions dated 27th February, 2024.
We find merit in the submission of the Respondent that each condition at Paragraph 2 in the Notifications is an independent exception and the exporter seeking to invoke the said exception has to fulfil each of the stipulations set out in the said condition. This is for the reason that each condition in the Notifications is intended to independently carve out an exception for facilitating export of shipments, which were in transition and the test to determine if the shipment is in transition was identified separately as condition nos. (i) to (iv) in the Notifications.
Under the Notification, the Respondent has carved out five independent exemptions so as to entitle the exporters with transitional arrangements to comply with their export obligations. The Respondent admittedly was granted the benefit of the exemption for 17,000 MT as it complied with condition no. (v) in its entirety with respect to payment of export duty.
Each of the five independent exemptions have essential requirements which the applicant exporter must comply with for completing the export. The Appellant fails to comply with the essential conditions in each of the exceptions. Therefore, the doctrine of substantial compliance relied upon by the Appellant is of no assistance as the Courts have held that latitude can be shown to the applicant only with respect to requirements which are directory in nature, the non-compliance of which would not affect the essence of the Notification granting exemption.
Since the vires of the Notifications and reasonableness of exemption condition nos. (i) to (v) is not under challenge; and the Appellant admittedly fails to satisfy the essential conditions contained in each of the independent exemptions, we are unable to accept the contention of the Appellant that it can be permitted by Respondent to export 11,000 MT by taking an overall view of substantial compliance, which in the opinion of this Court is in essence a subjective evaluation, which is not the remit of the Notifications.
Keeping in view the objective of the Central Government in imposing this ban with immediate effect was to avert a food crisis in the country, a strict compliance of the exemption conditions would further the said intent of the Notifications.
The Appellant had also placed reliance upon the interim order dated 06th December, 2023 passed by the High Court of Chhattisgarh in I.A. No. 01/2023 filed in W.P.(C) permitting the exporter therein to export non-basmati rice. In this regard, we may note that the learned Single Judge of the High Court has referred and relied upon the order dated 19th October, 2023 passed by High Court of Andhra Pradesh while passing the interim order. The Respondent has stated that it is in the process of filing a SLP against the order passed by High Court of Chhattisgarh. The High Court of Chhattisgarh has considered the fact that the exporter therein has a pre-existing contract with the foreign importer along with letter of credit for granting ad-interim permission for export. We are of the considered opinion that in view of the express suspension of the FTP, 2023, the said fact stands expressly excluded from the scope of the Notifications and therefore, could not have formed the basis for granting relief.
We have been unable to satisfy ourselves in the present appeal that the Appellant herein has satisfied the exemption conditions of the Notifications. Thus, we find that there is no merit in the appeal. Accordingly, the same is dismissed.
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