2013 (5) TMI 650 - HC - Customs

Import of second hand Digital Multifunction Print and Copying Machines - petitioners approaching the respondents seeking clearance of goods under Free importability - whether Used Digital multifunction Print and Copying machines will fall under Restricted Category - Held that - On a perusal of the records available, this Court is of the considered view that the used Digital Multifunction Print and copying Machines, imported by the petitioners, cannot be said to fall under the category of Hazardous Waste , as per Rule 3(1)(iii) of the Hazardous Waste (Management, Handling and Transboundary Movement) Rules, 2008, read with Basel No. B1110 of part B of schedule III to the said Rules, 2008. As gathered, from the Minutes of the twenty fourth meeting of the Technical Review Committee, held at New Delhi, on 16-11-2011, that there is no specific mention about the multifunction devices in the EXIM and therefore, the import of multifunction devices need to be placed in the same category, as photocopying machines. As during the period prior to 05.06.2012, the old and used Digital Multifunction Printing and Photocopying Machines could be import without any licence. In the light of the principle enunciated in Union of India and Others v. Asian Food Industries (2006 (11) TMI 10 - SUPREME COURT OF INDIA) & Gem Granites v. Commissioner of Income Tax, T.N. (2004 (11) TMI 13 - SUPREME Court) this Court makes it clear that Notification No. 1 (RE-2012)/2009-2014, New Delhi dated the 5th June, 2012 will come into force with effect from 5th June 2012. Therefore, the reliance made on the said Notification to state that the goods imported would come under Restricted Category cannot be pressed into service in these writ petitions. In the present case, import of goods have taken place earlier i.e., before 5th June 2012. Therefore, such reliance made on the Notification will not help the Respondents in any manner to advance their case. Writ petitions are allowed with a direction to the authorities to release the goods in question which had already been inspected by the authorised engineers, on payment of the appropriate customs duty.

Issues Involved:
1. Classification of imported goods as "Second Hand Capital goods" under "Free importability."
2. Determination of whether the imported goods are hazardous and fall under the "Restricted Category."
3. Application of recent notification and its retrospective effect.

Issue-wise Detailed Analysis:

1. Classification of Imported Goods as "Second Hand Capital Goods" under "Free Importability":

The petitioners imported second-hand Digital Multifunction Print and Copying Machines and sought clearance under "Free importability" as per Para 9.12 of the Foreign Trade Policy and Hand Book of Procedures 2009-2014. They engaged Chartered Engineers for examination, and reports confirmed the conformity of the goods with the declarations. Despite this, the respondents did not take timely action for clearance, prompting the petitioners to approach the court.

The court noted that similar cases had been decided previously, where the goods were directed to be released after inspection and payment of customs duty, subject to adjudication. The court found these writ petitions to be covered by the same precedent and directed the authorities to release the goods upon payment of appropriate customs duty and fulfillment of legal conditions.

2. Determination of Whether the Imported Goods are Hazardous and Fall Under the "Restricted Category":

The respondents argued that the imported goods were hazardous and fell under the "Electrical and Electronic Assemblies" of Basel Entry B1110 of Part B of Schedule III of the Hazardous Rules, 2008, requiring pre-import clearance. They contended that the goods were in the "Restricted Category" and hazardous in nature.

The court reviewed the previous judgment where it was determined that the goods did not fall under the category of "Hazardous Waste" or "Electrical and Electronic Assemblies" as per the Basel Convention. The court reiterated that the goods imported by the petitioners were not hazardous and did not fall under the restricted category, as sufficient evidence was not provided by the respondents. The court emphasized that the Digital Multifunction Print and Copying Machines were not in the restricted category at the time of import.

3. Application of Recent Notification and Its Retrospective Effect:

The respondents cited Notification No. 1 (RE-2012)/2009-2014 dated 5th June 2012, which categorized the goods under the "Restricted Category." They argued that this notification should apply retrospectively.

The court clarified that any notification issued under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992, operates prospectively. The specific wording of the notification indicated it would come into force from 5th June 2012. The court referred to Supreme Court judgments to support the principle that statutory orders under Section 5 have prospective effect and cannot retroactively affect vested rights.

The court concluded that the notification could not be applied retrospectively to the imports that occurred before 5th June 2012. Consequently, the goods imported before this date did not fall under the "Restricted Category" as per the new notification.

Conclusion:

The court allowed the writ petitions, directing the authorities to release the goods that had been inspected by authorized engineers upon payment of appropriate customs duty, subject to adjudication. For goods not yet inspected, the customs authorities were instructed to arrange for inspection before release. The court emphasized the need for expeditious release of the goods and closed the connected miscellaneous petitions.

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