2014 (5) TMI 598 - AT - Customs

Classification of goods - whether the red sanders handicrafts exported were prohibited goods falling under tariff item 4403 9918 and confiscable as held by Revenue while appellant claims the goods to fall under the tariff heading 97019091 and restricted goods but freely exportable - Held that - There is no difference to the factual aspect that the appellant was attempting to export 7721 red sander wood items concealed under the sandal wood handicrafts. Such concealment proves apprehension and fear of the appellant as to the prohibition of export thereof. When the goods concealed were found to be red sander goods and proved from the botanical report to be so, the appellant came with the plea that the goods fall under tariff heading 9701 9091, while Revenue claimed the goods to fall under Customs Tariff heading (CTH) 4403 9918. The Entry 9701 9091 specifies the goods as domestic article of wood (hand decorated) . Such items are freely exportable. But the item of the goods presented before us in the course of hearing do not appear to be hand decorated domestic article but specific goods of the description of handcrafts made of red sanders wood. Therefore, the goods attempted to be exported shall be out of the ambit of entry 9701 9091 - export made by shipping bill No. 479 dated 25.08.2009 was covered by 2004-09 Policy. Therefore, appellant s plea that the benefit of above notification dated 03.12.2013 is available to it is of no avail. Added to that the grant of Notification is only permissible only from the date of notification but not retrospectively as has been held by Apex Court in the case of Sunwin Technosolutions Pvt. Ltd. vs. Commr. of Central Excise, Ranchi 2010 (9) TMI 71 - SUPREME COURT OF INDIA - Therefore, any benefit granted to the appellant under Exim policy of 2009-14 shall be mockery - Decided against the assessee.

Summary

Issues:
Determining whether red sanders handicrafts exported were prohibited goods under a specific tariff item or restricted goods freely exportable.

Analysis:
1. The case involved the export of wooden handicraft items made of red sanders, alleged to be concealed under sandalwood items. Customs seized the goods and confirmed them as red sanders wood, classified as prohibited goods under the Export Policy, 2004-09.

2. Adjudication resulted in the absolute confiscation of the goods under the Customs Act, 1962, along with the imposition of penalties. The appellant appealed against this decision, which was partially upheld by the Commissioner (Appeals).

3. The appellant argued that the red sanders wood items were handicrafts and not prohibited goods, citing the Export Policy and a High Court judgment. They claimed the goods were meant for export under a specific entry in the policy, making them freely exportable.

4. The appellant further contended that a notification issued by DGFT in 2013 amended the Export Policy to include handcrafts made from red sanders wood as exportable goods. They emphasized that the goods exported were not prohibited but restricted and should not have been confiscated or penalized.

5. Revenue argued that the concealment of red sanders wood under sandalwood items indicated the appellant's knowledge of exporting prohibited goods, justifying the confiscation. They maintained that the adjudication decision should stand.

6. The Tribunal analyzed the tariff headings and Export Policy provisions to determine the classification of the goods. It was established that the goods did not fall under the entry for freely exportable domestic wood articles but were specific handicrafts made from red sanders wood, aligning with the prohibited goods category.

7. The Tribunal referred to the Export Policy entries distinguishing prohibited and restricted goods, confirming that the red sanders wood items in question were covered under the prohibited goods category, leading to the confiscation upheld by the Commissioner (Appeals).

8. The appellant's argument regarding a subsequent notification under a different Export Policy was dismissed as the export occurred under the previous policy. The Tribunal emphasized that the notification benefits could not be applied retrospectively, citing relevant legal precedents.

9. The appellant's plea for redemption of the confiscated goods under section 125 of the Customs Act was rejected, considering the concealment and fraudulent export attempt. The Tribunal upheld the dismissal of the appeal, affirming the Commissioner (Appeals) decision.

In conclusion, the Tribunal upheld the confiscation of the red sanders wood items as prohibited goods, dismissing the appeal and affirming the penalties imposed by the adjudication authority.