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Customs - Case Laws
Showing 41 to 60 of 38286 Records
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2024 (5) TMI 82 - MADRAS HIGH COURT
Safeguard duty levied on the import of solar cells and modules - Validity of levy during the period when the injunction from the High Court of Orissa was active - Protection of the domestic industry - contravention of the order passed by the High Court of Orissa - Whether the statutory scheme contained in the provisions of the Act of 1975 and the Rules of 1997 have been complied with - HELD THAT:- On navigating through the discussion and the consideration of the various aspects before arriving at the final finding, it is evident that all the pleas raised by the stakeholders were considered and opportunity was given to all the stakeholders to represent their stand. The principles of natural justice are also complied with. The said final finding thereafter is accepted by the Central Government by issuing the notification. The said issuance of the notification imposing safeguard duty is a legislative act. The courts will adopt a liberal attitude in upholding the delegation when taxing power is conferred. The impugned notification is a piece of a subordinate legislation, more particularly, when the said notification imposes the safeguard duty not in reference to a particular importer, exporter or a specific country.
The final finding was arrived at by the second respondent on 16.7.2018. The interim order of injunction was passed by the Orissa High Court in W.P. The notification was issued by the Central Government imposing safeguard duty on 30.7.2018, during the subsistence of the order of interim injunction prohibiting the respondents from issuing the notification. The Supreme Court stayed the interim order of injunction passed by the Orissa High Court on 10.9.2018.
The Apex Court in the case Mulraj v. Murti Raghunathji Maharaj,[1967 (3) TMI 111 - SUPREME COURT], considered the effect of action taken subsequent to passing of an interim order in its disobedience and held that any action taken in disobedience of the order passed by the Court would be illegal. Subsequent action would be a nullity.
In DDA v. Skipper Construction Co. (P) Ltd., [1996 (5) TMI 326 - SUPREME COURT], the Apex Court after making reference to many of the earlier judgments held that those who defy a prohibition ought not to be able to claim that the fruits of their defiance are good, and not tainted by the illegality that produced them.
In the present case, though the interim order of injunction was in force when the notification was issued, the said order was stayed by the Apex Court on 10.9.2018 and on and from 10.9.2018, the notification would become operative, as the prohibitory order did not exist. The contention of the petitioners that as the notification was issued during the subsistence of the prohibitory order, even after the prohibitory order was stayed by the superior court still the notification would be inoperative, cannot be comprehended.
The notification issued is legislative in character. The executive exercised the powers of delegated legislation. The notification, during the subsistence of the interim order of injunction, is certainly inoperative, but on and from the date the stay was granted by the Apex Court to the prohibitory order passed by the Orissa High Court, the notification will become operative and binding upon the parties. The Central Government would not be required to issue a fresh notification after the order of injunction was stayed.
In the case of V.P. Sheth [1999 (9) TMI 995 - MADHYA PRADESH HIGH COURT], the appellant therein was compulsorily retired on 10.1.1989. The Central Administrative Tribunal set aside the order of compulsory retirement. The respondents filed a SLP before the Apex Court. The Apex Court stayed the final order passed by the Central Administrative Tribunal. The Apex Court in the said case observed that the effect of the stay is that the order of the Central Administrative Tribunal is not operative and the order of compulsory retirement remains in force.
Thus, it can safely be held that on and from the date the order of injunction passed by the Orissa High Court was stayed by the Apex Court, i.e., 10.9.2018, the notification became operative and effective.
In W.P., the petitioner has been assessed for safeguard duty vide Bill of Entry dated 2.8.2018. The same was during the subsistence of the prohibitory order passed by the Orissa High Court and before the stay was granted by the Apex Court. The respondents, certainly, could not have assessed the same, as during the said period the notification could not have been issued. The respondents also suggest that the same should not be assessed. Therefore, the order of self-assessment, vide the impugned Bill of Entry No.7474159, dated 2.8.2018, to the extent it seeks to impose safeguard duty pursuant to the notification dated 30.7.2018, is illegal and arbitrary, inasmuch as it was issued during the subsistence of the order of injunction, and accordingly the same is quashed and set aside.
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2024 (5) TMI 81 - DELHI HIGH COURT
Release of duty drawback and a rebate under Rebate of State and Center Taxes and Levies (ROSCTL) - 13 shipping bills uploaded on the respondent's online portal, with a formal application yet to be made. - HELD THAT:- Learned counsel for the petitioner submits that in so far as release of IGST and interest is concerned, the same already stands allowed in favour of the petitioner and the issue now surviving is with regard to release of ROSCTL. Learned counsel submits that the same pertains to 13 shipping bills which were uploaded on the online portal of the respondent, out of which 11 were uploaded on 31.03.2020 and two were uploaded on 30.10.2020.
Learned counsel for the petitioner submits that without prejudice to her rights and contentions, petitioner shall make a formal application in terms of the said procedure within a period of one week.
On such an application being filed, respondent shall process the same in accordance with the rules and law within a maximum period of four weeks from the date of submission of the application.
The petition is accordingly disposed of, reserving the right of the petitioner to take such further remedy as may be permissible in law in case aggrieved by any order passed by the respondent.
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2024 (5) TMI 80 - CESTAT NEW DELHI
Imposition of Penalties u/s 112(a) & (b) and 114AA - Each appellant denied direct involvement or knowledge of the illegal activities, claiming to have played different roles in the importation process. - import of restricted / prohibited goods - confiscation of goods - allegation for never received the summons - HELD THAT:- We have no doubts in our minds that the Sushil Aggarwal was not merely an indenting agent but was an active player involved at every stage in the entire operation from placing orders for the imported goods including the import of the prohibited goods, mis-declaration in the documents, clearance of the goods, transporting them to the godown and selling them, receiving the sale proceeds and further distributing them among various operators.
We find the penalties imposed on him under Section 112 and 114AA must be sustained and they call for no interference.
Sunil Aidasani - claims to have never received the summons and hence he had not appeared to give his statements - As far as the allegations that 12 of the 19 containers actually belonged to him are concerned, these are based on the statements of Bhalla. A statement made by Bhalla u/s 108 of the Customs Act will be relevant to prove the case only as per section 138B. This requires the adjudicating authority to examine the person making the statement and decide if it is to be admitted in evidence. Needless to say that if it is admitted in evidence and is proposed to be used against another person, such person should be allowed to cross examine the person making the statement.
Since the procedure prescribed u/s 138B was not followed, the statement is not relevant to prove the case against Aidasani.
We also find that neither section 112 nor section 114AA provide for penalty for not responding to summons or not cooperating with the investigation. Therefore, the penalties imposed on Aidasani in the impugned order cannot be sustained and need to be set aside.
Naveen Gulabani - The allegation in the SCN is that he is an employee of Sunil Aidasani@ Vicky and that he had not responded to the summons and had not cooperated with the investigation.
We find neither section 112 nor section 114AA makes one liable to penalty either for being an employee of the overseas supplier of goods nor for not responding to summons and not cooperating with the investigating agency. Therefore, the penalties imposed on Gulabani cannot be sustained and need to be set aside and we do so.
Therefore, the penalties imposed on Gulabani in the impugned order cannot be sustained and need to be set aside.
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2024 (5) TMI 79 - CESTAT NEW DELHI
Benefit of reduced penalty of 15% u/s 28(5) - Delay in payment of penalty due to Public Holiday - The appellant voluntarily paid the differential BCD and interest upon detection of the misclassification - Importation of ‘drawings and designs on paper made with aid of computer’ - Wrongly classification of the imported goods and claim of exemption - wilful misstatement or suppression of facts - HELD THAT:- No evidences are available on record to show that the appellant had bona-fide intention in claiming wrong classification of the disputed goods and availment of the exemption from payment of the BCD under the notification dated 17.03.2012 read with notification dated 30.06.2017. It is also an undisputed fact that the appellant had voluntarily paid the differential BCD and interest amount upon detection of wrong classification by the DRI. The reduced penalty amount as per sub-section (5) of Section 28 ibid was also paid suo-moto by the appellant, consequent upon receipt of the SCN. Thus, it cannot be said that the department’s action in invoking the penal provisions u/s 114A ibid is not proper or justified.
In the case in hand, since 14th and 15th of December were being holidays as second Saturday and Sunday, payments made by the appellant in the designated bank on 16.12.2019 would be considered as the deposit made within the stipulated time frame. Since, the appellant has complied with the requirement of sub-section (5) read with sub-section (6) of Section 28 ibid, in our considered view, payment of reduced amount of penalty @15% of the BCD amount would be considered as sufficient compliance in terms of the statutory provisions. Since, the appellant in this case had deposited such reduced amount of penalty, as per Section 10 of the General Clauses Act, 1897 read with Section 28 ibid, in our considered view, such deposit should meet the ends of justice for the purpose of the benefit provided for reduction in the quantum of penalty. Thus, the impugned order, imposing equal amount of penalty shall not be sustained for judicial scrutiny.
Thus, the impugned order to the extent it has confirmed equal amount of penalty on the appellant is set aside and the appeal to such extent is allowed in favour of the appellant, holding that the appellant would be liable to pay the reduced amount of penalty at the rate of 15%, which they have already complied with.
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2024 (5) TMI 78 - CESTAT BANGALORE
Levy of penalty and Revocation of Courier license - Allegation of abetting in mis-declaration of value of imported goods - Importation of mobile parts - G-card holder had fabricated documents - duty - Interest - Penalty imposed under Regulation 14 of Courier Import and Export (Electronic Declaration and processing) Regulations, 2010 and u/s 117 of the Customs Act, 1962 - bill of entry filed without complying with the KYC norms - violation of the Regulation 12 - HELD THAT:- There was omission on the part of appellant to engage the executive Shri M. Elias as authorized person to file courier bills of entry as per Regulation 12(ii) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010. However considering the situation that prevailed during post-covid period, the appellant might have failed to comply with said provision and same cannot be reason to invoke harsh proceedings including revocation of courier license and enforcement of bond and bank guarantee executed in connection with registration/license as an authorized courier. We find that for such venial omission, appropriate penalty under the provisions of Regulation 12(ii) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, would suffice.
We find that as regards the penalty under Regulation Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, considering the revocation of the Courier license, since September 2023, a lenient view can be taken. Thus, the penalty imposed on the appellant under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 is reduced to Rs. 25,000/-.
In the result the impugned order is modified and appeal is partially allowed by setting aside revocation of Courier License and enforcement of Bond and Bank Guarantee executed in connection with the Registration/Issue of Courier License. In view of the discussion at Para 9 (supra), penalty imposed on the appellant u/s 117 of the Customs Act, 1962 is set aside. The penalty imposed on the appellant under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 is reduced to Rs. 25,000/-(Rupees Twenty Five Thousand only)
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2024 (5) TMI 77 - CESTAT BANGALORE
Levy of penalty for abetting in mis-declaration of imported goods - Revocation of Courier License - authorized courier agent - mis-declaration of the value - Shipment without proper KYC verifications and authorization of the import - violation of the provisions of Courier Imports and Exports (Electronic Declaration and processing) Regulations, 2010 - HELD THAT:- As the appellant is only facilitating the customs transaction on behalf of principal, (importer/exporter), the absence of mens-rea, penalty is not imposable, otherwise all the customs transaction will come to halt, if penalty is imposed on the customs broker the omission /commission of exporter/importer. Moreover, in the impugned order Adjudication Authority itself held that there is no illegality revealed related to goods cleared through the appellant.
Appellant has not received any authorization for filing the courier bills of entry. However, while submitting reply to show cause notice, appellant submits that the importer is identified and appellant had caried out KYC verification such as IEC and GST registration as per information provided by Mr. Ajit. Moreover, the appellant produced Email communication as proof of authorization and thereby complied with the KYC verification. The absence of any provision which mandate receipt of KYC directly by courier agency u/s 146 of Customs Act,1962, finding of violation of the Regulation 12(i) is unsustainable.
The bills of entry were filed by G Card holder Shri. V.V. Suresh, who is an authorized person to file bill of entry as per section 146 of Customs Act,1962. Thus, in the absence of any evidence regarding filing of bill of entry by Shri. I. S. Patil and not ‘G’ Card holder Shri. V. V. Suresh, violation of the Regulation 12(ii) is unsustainable as held by the adjudicating authority.
As regards violation of the Regulation 12 (iv) & (vi) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, the adjudicating authority held that the delivery address of the importer is in Delhi and appellant has not verified the identity of the client by using reliable, independent document. Moreover, even as per the allegation in the SCN, there is no import of prohibited/restricted goods and there is no allegation related to goods cleared by appellant.
Thus, appeal is allowed by setting aside revocation of courier license and enforcement of Bond and Bank guaranty executed in connection with registration/license. Penalty imposed on the appellant u/s 117 of the Customs Act, 1962 is set aside. Penalty imposed on the appellant under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 is also set aside.
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2024 (5) TMI 76 - CESTAT KOLKATA
Levy of maximum Penalty - delay in submitting the documents for finalization of the Bills of Entry - Duty paid on provisional basis - HELD THAT:- Admittedly the Department has not brought in any evidence to the effect that the Appellant has deliberately delayed the finalization of the Bills of Entry. On a query from the Bench, the Ld. Consultant submits that even in respect of the 12 Bills of Entry in question, the finalization has been completed and there is no pendency on their side.
Therefore, following the ratio of the decision in the case of Jai Balaji Industries Ltd.,[2021 (1) TMI 767 - CESTAT KOLKATA], I set aside the impugned Order and allow the Appeal.
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2024 (5) TMI 22 - CESTAT NEW DELHI
Mis-declaration of Mud additive chemicals for oil well - Confiscation - Valuation - Payment of redemption fine - Penalty - denial of the cross examination by the Commissioner - Relevancy of statements u/s 138B - HELD THAT:- It is a well-settled legal position that unless the statements have been put through the process prescribed u/s 138B, they are not relevant at all to prove the case. By not following the procedure prescribed in section 138B, the Commissioner has rendered all the six statements (RUD- 4 to RUD-9) irrelevant to prove the case.
The only other important document is the test report of the CRCL. Shri Singhal’s assertion was that what was attempted to be exported was Mud Additive Chemical and according to the CRCL, it was urea. Therefore, if Shri Singhal wanted to cross examine the chemical examiner who had tested the sample and said that it was urea, it is but just and proper. However, the Commissioner denied cross examination.
Once all the statements and the test report of CRCL are ignored, nothing survives in this case and the impugned order cannot be sustained.
To sum up: (a) By not following the procedure prescribed under section 138B, the Commissioner rendered all the six statements relied upon in the SCN irrelevant to the case;
(b) By denying cross examination the Commissioner has also rendered the test report of CRCL irrelevant to prove the case of the department.
(c) De hors the statements and the test report of the CRCL, nothing survives in the impugned order.
Thus, all three appeals are allowed and the impugned order is set aside insofar as it pertains to Shri Singhal, Shri Bharadwaj and Shri Jindal.
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2024 (5) TMI 21 - CESTAT NEW DELHI
Classification - Import of ‘Accordion springs’ - Demand duty - Interest - Penalty - benefit of exemption Notification - Whether the ‘Accordion springs’ imported by the appellant are ‘leaf springs’ classifiable under Customs Tariff Item [CTI] 7320 10 11 as claimed by the appellant or as ‘other springs under CTI 7320 90 90 - HELD THAT:- We find that ‘Accordion Springs’ imported by the appellant are neither helical springs nor leaf springs and are a category of springs in themselves. They are also sold as ‘Accordion springs’ only and not as leaf springs or helical springs. Therefore, they fall under the Customs six digit heading of 7320 90 ‘Other’. Under this, there are three eight digit Customs Tariff Items and since these do not fall under the categories of coil springs for railways (7320 90 10) or spring pins (7320 90 20), they fall under the residual category of CTI 7320 90 90. We, therefore, find in favour of the Revenue and against the appellant on the question of classification.
Thus, the appeal is dismissed and the impugned order is upheld.
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2024 (5) TMI 20 - CESTAT MUMBAI
Seeking amendment of the Shipping Bills in terms of Section 149 of the Customs Act, 1962 - Jurisdiction of the First Appellate Authority - Whether decision or order passed by an officer of Customs, lower in rank than a Commissioner of Customs, can only be appealed against before the Commissioner (Appeals) and not otherwise - HELD THAT:- On perusal of the letter dated 09.06.2022 addressed by the Assistant Commissioner of Customs to the appellant, we find that though the said letter was signed by him, but the views of the Administrative Commissioner of Customs was conveyed that the request for amendment/conversion of shipping bills cannot be adhered to. Thus, we are of the considered opinion that the decision for rejection of the letter of appellant, seeking amendment of shipping bills was taken by the Commissioner of Customs and not by the officer lower in rank than him.
Since, the Administrative Commissioner has communicated the view regarding non-entertainment of the application for amendment of the Shipping Bills, the order or decision passed by him cannot be appealed against before the Commissioner (Appeals) in terms of Section 128 ibid, wherein, it has been mandated that decision or order passed by an officer of Customs, lower in rank than a Commissioner of Customs, can only be appealed against before the Commissioner (Appeals) and not otherwise.
Therefore, we are in agreement with the order passed by the learned Commissioner (Appeals) that he has no jurisdiction to entertain the appeal against the decision of the Administrative Commissioner. Accordingly, we do not find any infirmity in the impugned order, and thus dismiss the appeal filed by the appellant.
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2024 (5) TMI 19 - CESTAT KOLKATA
Smuggling - Absolute confiscation of the twelve gold biscuits of foreign origin - No licit document produced in support of acquisition, possession or transportation of the gold - Penalty - retracted statements - 'reasonable belief' - Applicability of sec. 123 - carrying the gold at the time of interception - HELD THAT:- We observe that the ‘reasonable belief’ on which the officers presumed that the gold bars/pieces were of smuggled nature is not supported by any corroborative evidence. There is no document available on record to establish that gold bars/pieces were smuggled into India without payment of customs duty. The impugned order has concluded that the said gold bars/pieces were smuggled into India only on the basis of assumptions and presumptions without any concrete evidence to substantiate this claim. Hence, we hold that material evidence available on record does not establish the ‘reasonable belief’ that the gold bars/pieces were smuggled into India without any valid documents.
Applicability of the provisions of Section 123 of Customs Act 1962 in this case, we observe that Section 123 puts the burden of proving that the gold is not smuggled one on the person who claims ownership of the gold. This section is applicable only when there is a ‘reasonable belief’ that that the gold in question are smuggled in nature. In this case, the discussion in the preceding paragraphs has established that there is no ground for holding the reasonable belief that the gold are smuggled in nature. When there is no material evidence available on record to establish that the gold bars/pieces were smuggled into India without any valid documents, the provisions of Section 123 of the Customs Act are not applicable.
The purity of the gold is 995.2 mille, 995.1 mille and 995.0 mille which is below the International Standard of Purity. Accordingly, we hold that the Order passed by the Adjudicating Authority confiscating the gold bars/pieces mainly on the basis of the statements, is not sustainable in law. Thus, the gold bars/pieces cannot be confiscated based on the retracted statements without any other independent corroborative evidence.
Penalty imposed u/s 112(b)(ii) - Under Section 112(b), penalty is imposable when the person is found to be dealing with goods for which prohibition is in force or the goods are liable for confiscation. The gold bars/pieces found in possession of the appellant were not established as smuggled in nature and hence they are not prohibited goods. The gold bars/pieces were seized at Imphal, away from the Indo-Myanmar international border. The appellant was carrying the gold which he claimed that they were domestically purchased by his father and he inherited the same. We observe that the investigation has not brought in any evidence to counter this claim. Hence, we find merit in the argument of the appellant that penalty is not imposable on him u/s 112(b)(ii) of Customs Act, 1962.
Thus, we set aside the impugned order and allow the appeal filed by the appellant.
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2024 (5) TMI 18 - CESTAT NEW DELHI
Re-classification of Thorn - Transaction value - Undervaluation and Mis-declaration - erroneous classification - ineligible exemption - demand duty - Confiscation - Penalty - Imports Aluminium scrap described as ‘Thorn‘ - Violation of import restrictions under the FTDR Act - FTDR Act has three categories of goods ‘free‘, ‘restricted‘ and ‘prohibited‘, the Customs Act has only ‘prohibited goods‘ and everything else is considered freely importable - HELD THAT:- No dispute about the rejection of the classification of the imported Thorn under CTI 7602 00 10 and its reclassification under CTI 7602 00 90. The importer‘s only contention is that it had mistakenly classified it under CTI 7602 00 10. Therefore, the re-classification must be upheld.
Transaction value under Valuation Rule 12 and re-determination of the value under Valuation Rule 9 - The Additional Commissioner recorded that since Thorn was a restricted item, there were no contemporaneous imports of identical or similar goods. Valuation Rule 6 is not a method of valuation and it only states that if the value cannot be determined under Valuation Rules 3,4 or 5, it shall be determined under Valuation Rule 7 or Valuation Rule 8 and at the request of the importer, Valuation Rule 8 can be applied without applying Valuation Rule 7 first. Valuation Rule 7 is a deductive method and it provides for determination of value based on the value of such goods sold in India and after making certain deductions. Valuation Rule 8 provides for computed value based on the cost of production of such goods in India. The Additional Commissioner, having recorded that these were not possible in this case, followed Valuation Rule 9 which is the residual method. He determined the value as per the method recommended by the Directorate General of Valuation in such cases based on the aluminum content of the imported scrap and the London Metal Exchange (LME) prices of the metal.
We find that the method followed by the Additional Commissioner for determining the value is correct and proper and this decision has been correctly upheld by the Commissioner (Appeals) in the impugned order. We find no reason to interfere with the valuation.
Absolute confiscation of the imported Thorn - We find that clause (d) makes the goods imported into India contrary to any prohibition under the Customs Act or under any other law for the time being in force. Import of Thorn was restricted under the FTP and therefore, it could not have been imported without a licence. Since Thorn was imported in violation of the prohibition under FTP, it was liable to confiscation u/s 111(d).
The imported goods cannot be confiscated u/s 111(m) because of a wrong classification or claim of an ineligible exemption notification. In this case, the importer imported Thorn and entered an incorrect classification at the 8-digit level in the Bill of Entry and gave a value as per its transaction value. When examining the self-assessment, the incorrect classification was discovered.
The importer declared the value as per its transaction value. This transaction value was rejected by the officer and its value was re-determined. Thus, the two deviations from the declaration of the importer in the Bill of Entry are- the change in classification and re-determination of value by the officer. Simply because the officer has changed the classification and the valuation, the goods do not become liable to confiscation u/s 111(m) because the goods did correspond to the declarations and only the classification and the valuation which are matters of opinion were changed by the officer.
Thus, we find that the Thorn imported by the appellant was correctly confiscated u/s 111(d) and 111(o) but its confiscation u/s 111(m) was not correct. The question which arises is, if in this factual matrix, was the absolute confiscation of the imported Thorn correct or it could have been released on payment of redemption fine.
We find no reason to believe that aluminium scrap with only 1.2% of other material such as iron, plastic, etc. will be hazardous to the society if released into the hands of a manufacturer of ingots. On the other hand, import of Thorn requires a licence which the importer did not have and hence it was confiscated.
In the factual matrix of this case, considering all relevant factors, we find that it would meet the ends of justice if the confiscated Thorn valued at Rs. 27,48,405 is allowed to be redeemed by the importer u/s 125 on payment of a fine of Rs. 4,00,000/-.
Penalties u/s 112(a) (i) and 114AA on the importer and Shri Jain - The importer imported Thorn without the required licence and therefore it is squarely covered by section 112(a). Penalty not exceeding the value of the goods could be imposed under this section. The value of the goods as determined by the impugned order is Rs. 27,48,405/- and therefore, a penalty of Rs. 4,00,000/- is within the limits and is in the factual matrix, in our opinion, just and proper.
As far as the penalty on Shri Jain is concerned, we find that he was a partner of the importer and in that capacity, he played the role in importing the goods. We do not find sufficient justification to also impose penalty on Shri Jain u/s 112 (a) (i). We, therefore, set aside the penalty on Shri Jain under this section.
The importer only made an erroneous classification which is not a declaration or document but is its self-assessment. The importer also declared the value as per its transaction value which the officer deemed it necessary to re-determine. The importer can only declare the value based on what he knows and there was no mis-declaration. Thus, we find that there is no mis-declaration, let alone, one with intent either by the importer or by Shri Jain. Therefore, the penalties imposed u/s 114AA on the importer and Shri Jain cannot be sustained and need to be set aside and we do so.
Thus, both appeals are disposed of as below:
(a) CUSTOMS APPEAL filed by the importer is partly allowed and the impugned order is modified to the extent of allowing redemption of the confiscated goods on payment of redemption fine of Rs. 4,00,000/- u/s 125 and setting aside the penalty imposed u/s 114AA.
(b) CUSTOMS APPEAL filed by Shri Jain is allowed and the penalties imposed on Shri Jain u/s 112 (a) (i) and 114AA are set aside.
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2024 (5) TMI 17 - CESTAT CHENNAI
Undervaluation - Imports of high-end foreign cars - concessional duty benefit - Notification No.21/2002–Cus - Interest - Penalty - Whether the revenue authorities are correct in redetermining the assessable value of the car imported by the appellant - HELD THAT:- The first appellate authority, while ordering the re-determination of the assessable value, has inter alia held that the imported vehicle was undisputedly new, which finding has again been accepted by the revenue without challenging the same. In the impugned order, the first appellate authority has referred to an alleged e-mail and an alleged original sale invoice raised by the Japanese dealer on the UK dealer, which according to the first authority, justify the fixing of assessable value at ₹49, 84, 163. Further, the Ld. first appellate authority has held that since the vehicle is held to be a new one, the same would also entitle the appellant for concessional rate of BCD.
We have seen the invoices, one which was raised on the Broker at UK by the Japanese dealer and the other one which was raised by the UK Broker on the appellant; both are for two different cars; one refers to Ultimate Silver colour car carrying an invoice amount of 8,900,000 Yen and the other refers to a Black colour car carrying an invoice amount of 63,000 USD. That apart, invoice raised by the Japanese dealer is dated 18.08.08, but the invoice raised by the UK dealer and the appellant is 30.06.08 which is much before the date of even purchase by the UK dealer, hence, there has been much ado about nothing insofar as the invoices are concerned and therefore, the alleged difference in the purchase value by the appellant as made out in the Order-in-Original which was upheld in the impugned order lacks any merit.
We reiterate that it was the revenue, which alleged irregularities/under-valuation and hence, it was incumbent upon the revenue to prove its case. But however, other than uncorroborated e-mail and two different invoices, no documentary evidence is furnished before us by the revenue, in support.
Hence, we cannot agree with the stand of the revenue which lacks merit, for which reason the impugned order becomes unsustainable. In the result, we set aside the impugned order and allow the appeal with consequential benefits, if any, as per law.
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2024 (4) TMI 1107 - SC ORDER
Sustainability of supplementary Show Cause Notice, prior to insertion of second proviso to Section 124 of the Customs Act, 1962 w.e.f 29.03.2018 - effect to the second proviso to Section 124 of the Customs Act, 1962 which is effective from 29.03.2018 - retrospective or prospective effect? - High Court held that the supplementary show cause notice, although termed as the supplementary, is actually an independent show cause notice even though it relates with the case of smuggling which is also a subject matter of the first show cause notice dated 26.08.2016 - HELD THAT:- We dispose of this special leave petition reserving liberty to the petitioner to raise all contentions with regard to the show cause notice issued by the respondent-department which the High Court has termed as an independent show cause notice in accordance with law.
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2024 (4) TMI 1106 - SC ORDER
Maintainability of Appeal before CESTAT - Baggage Rules - Interpretation of statute - Smuggling - seizure of foreign currency - legislative edicts manifested in first proviso to section 129A of Customs Act - misreading of the terms ‘goods’ and ‘baggage’ defined in the Customs Act, 1962, to arrogate the jurisdiction - proper interpretation to the expression ‘beneficial owner’ defined in section 2(3A) of the Customs Act, 1962 - High Court held that Once the respondent themselves had asserted that the goods in question were liable to be confiscated in terms of Section 113(d), the objection taken to the maintainability of the appeal would not sustain - HELD THAT:- We are not inclined to interfere in the matter. The Special Leave Petition is hence dismissed. However, any question of law that may arise in this case is kept open.
Pending application(s), if any, shall stand disposed of.
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2024 (4) TMI 1105 - SC ORDER
Classification of imported goods - import of furnace oil from UAE - to be classified under CTH 27101950 (furnace oil) as declared by the appellant or under CTH 27109900 (waste oil) as alleged by the revenue? - Tribunal held that Since the test report of CRCL Vadodara/Delhi cannot be accepted the declaration made by the appellant in respect of nature of goods, classification and also valuation are found to be absolutely correct - HELD THAT:- We are not inclined to interfere in the matter. The civil appeal is hence dismissed.
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2024 (4) TMI 1104 - SC ORDER
Review Petition - Condonation of delay of 243 days in filing this appeal - Benefit of exemption from duty - 12V SMPS consisting of Main PCB, lightening protector, DC/AC cables, fuse/fuse holders and others - SMPS is not a part of IFWT - Supreme Court held that the delay is condoned - HELD THAT:- Having carefully gone through the Review Petition, the order under challenge and the papers annexed therewith, we are satisfied that there is no error apparent on the face of the record or any merit in the Review Petition, warranting reconsideration of the order impugned.
The Review Petition is, accordingly, dismissed.
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2024 (4) TMI 1103 - CESTAT NEW DELHI
Imposition of penalties u/s 114 (iii) and 114A on employees / manager of CHA - benami shipping bills - mis-declaration of the description quantity and value of export consignments in order to avail ineligible drawback - HELD THAT:- The appellant’s submission that he was not aware that the IEC holder was only dummy and Shri Ashok Sharma was the master mind cannot be accepted considering that all documents were received by the appellant Shri Ashok Sharma himself. The appellant’s submission that it was not required to verify the existence of the IEC holder of physically verifying the premises also cannot be accepted in the factual matrix of the case. Had the case been one where the IEC holder had supplied all the documents to the appellant and the appellant filed the shipping bills in good faith, the situation would have been different. However, in this case without the knowledge of the IEC holder, the appellant filed benami shipping bills. The appellant was required verify if the exporter in whose name he was filing the shipping bills was indeed the exporter, and was issued IEC, etc.
The appellant’s submission that he did not abet the commission of any offence u/s 114 (iii) of the Customs Act also cannot be accepted for the reason that the appellant had filed benami shipping bills with mis-declared quantities and values at the behest of Shri Ashok Sharma. It is the discovery of this mis-declaration which rendered the goods liable for confiscation. Therefore, the appellant was liable to penalty u/s 114 (iii) of the Customs Act. The appellant’s contention against the imposition of penalty u/s 114AA of the Customs Act also cannot be accepted for the reason that this section provides for penalty for willfully mis-declaring facts in any declaration before the customs authorities which the appellant did. Considering the value of the goods involved, we do not also find that the penalties imposed were excessive. We, therefore, find no reason to interfere with the order.
Thus, the impugned orders are upheld and all the appeals are dismissed.
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2024 (4) TMI 1102 - CESTAT NEW DELHI
Imposition Of Penalty - Revocation of the Customs Brokers’ licence - non-existent entities - violation of regulation 10 (n) of the Customs Brokers Licensing Regulations, 2013 - No opportunity to cross examine - violation of the principles of natural justice - HELD THAT:- DGARM did some analysis and came to the conclusion that several GST registrants did not exist and did not operate from their business addresses at all. It is undisputed that their registrations were issued by the very department which initiated the investigation. Thus, the irresistible conclusion is that if the DGARM is correct, then the department issued several benami (pseudonymous) GSTIN registrations to several entities which did not exist at all. Some of these non-existent entities were also filing GST returns with the department.
These allegedly non-existent entities were also issued importer exporter codes (IEC) by the DGFT. Thus, if the DGARM is correct, DGFT had issued benami IECs.
Neither of the documents were enclosed to the SCN or provided to the appellant, let alone giving the appellant an opportunity to cross examine those who sent them. This is clearly a violation of the principles of natural justice and on this ground alone, the impugned order deserves to be set aside.
The onus on the Customs Broker cannot, therefore, extend to verifying that the officers have correctly issued the certificate or registration. Of course, if the Customs Broker comes to know that its client has obtained these certificates through fraud or misrepresentation, nothing prevents it from bringing such details to the notice of Customs officers for their consideration and action as they deem fit. However, the Customs Broker cannot sit in judgment over the certificate or registration issued by a Government officer so long as it is valid. In this case, there is no doubt or evidence that the IEC, the GSTIN and other documents were issued by the officers. So, there is no violation as far as the documents are concerned.
Any of the three methods can be employed by the Customs Broker to establish the identity of his client. It is not necessary that it has to only collect information or launch an investigation. So long as it can find some documents which are independent, reliable and authentic to establish the identity of his client, this obligation is fulfilled. Documents such as GSTIN, IEC and PAN card issued etc., certainly qualify as such documents as none of these departments have any interest in the relationship between the client and the Customs Broker and these documents are presumed to be authentic and reliable having been issued by the Government officers. However, these are not the only documents the Customs Broker could obtain; documents issued by any other officer of the Government or even private parties (so long as they qualify as independent, reliable and authentic) could meet this requirement. While obtaining documents is probably the easiest way of fulfilling this obligation, the Customs broker can also, as an alternative, fulfill this obligation by obtaining data or information. In the factual matrix of this case, we are fully satisfied that the appellant has fulfilled this part of the obligation under Regulation 10(n).
The fourth and the last obligation under Regulation 10(n) requires the Customs Broker to verify the functioning of the client at the declared address using reliable, independent, authentic documents, data or information. This responsibility, again, can be fulfilled using documents or data or information so long as it is reliable, independent and authentic. Nothing in this clause requires the Customs Broker to physically go to the premises of the client to ensure that they are functioning at the premises. Customs formations are only in a few places while exporters or importers could be from any part of the country and they hire the services of the Customs Brokers.
In fact, the entire verification report is based on the GSTIN. Further, IECs issued by the DGFT also show the address. There is nothing on record to show that either of these documents were fake or forged. Therefore, they are authentic and reliable and we have no reason to believe that the officers who issued them were not independent and neither has the Customs Broker any reason to believe that they were not independent.
The responsibility of the Customs Broker under Regulation 10(n) does not include keeping a continuous surveillance on the client to ensure that he continues to operate from that address and has not changed his operations. Therefore, once verification of the address is complete as discussed, if the client moves to a new premises and does not inform the authorities or does not get his documents amended, such act or omission of the client cannot be held against the Customs Broker.
We, therefore, find that the Customs Broker has not failed in discharging his responsibilities under Regulation 10(n). The impugned order is not correct in concluding that despite obtaining and providing authentic documents issued by various Government officers, the Customs Broker has violated Regulation 10(n) because the exporters were found to not exist during subsequent verification by the officers.
Thus, the appeal is allowed and the impugned order is set aside with consequential relief to the appellant.
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2024 (4) TMI 1101 - CESTAT NEW DELHI
Validity Of Order in original passed by the Commissioner - Demand - Penalty - Import of Internal Remote Electrical Tilt Switches (iRET) - benefit of Exemption notification no. 50/2017-Cus - Whether the amperage of the iRETs imported by the appellant were of 5 Amps as declared in the Bills of Entry or were of less than 5 Amps as now asserted by the appellant relying on the aforesaid documents - HELD THAT:- The Commissioner has also wrongly declined to accept the test report of a government laboratory of another Ministry which certifies the amperage of the iRETs of the two models which were imported. The Commissioner has also declined to accept the clarificatory letter from the overseas supplier that due to a typographical error ‘<’ was not typed in all the invoices although the letter also clarifies that the actual amperage was 1.3 amperes. The logic of the Commissioner in declining to accept the letter of the supplier is that the supplier can only supply goods which are in its inventory and invoices are issued accordingly and he cannot now claim to have supplied iRETs of a different amperage. In our considered view, the Commissioner has gravely erred in not accepting the clarification from the supplier when it is consistent with the technical specifications in the product brochure and also consistent with a test report from a Government laboratory. If the supplier contended that a typographical error was committed in preparing the invoices and this assertion is supported by the product brochures, it was incorrect for the Commissioner to have rejected the clarification.
As the product brochures, the test reports and the letter from the supplier all confirm that the iRETs which were imported were of less than 5 amperes, it is not necessary for us to examine the other evidence adduced by the appellant. Clearly, there was a typographical error in the Bills of Entry and the invoices which has resulted in the audit objection, the SCN and the impugned order.
There is a discrepancy between what is stated to have been imported in the documents and the Bill of Entry and what is actually imported, duty can be charged on what is actually imported and not on what is said to have been imported. For instance, if 80 MT of goods are said to have been imported in the Bill of Entry and actually 100 MT of goods are imported, duty has to be charged on 100 MT and not on 80 MT. Similarly, if silver is declared to have been imported and actually gold is imported, duty has to be charged on gold and not on silver.
In this case, if the Bill of Entry, invoice, packing list, etc. mention 5 amperes but there is no dispute that the goods were of particular models and the product literature as well as the test reports show that they are of less than 5 amperes, it is not open to the department to charge duty treating the goods as of 5 amperes merely because the Bill of Entry and other documents say so due to a typographical error.
Thus, the appeal is allowed and the impugned order is set aside with consequential relief to the appellant.
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