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2015 (6) TMI 816 - HC - CustomsConfiscation of goods - Enhancement of value of goods - DGFT Notification No. 65(RE-2010)/2009-2014 dated 04.08.2011 - Held that - DGFT has not resorted to change of categorization of items, i.e. from the category of free export to category of restricted export , but as a sequel to earlier notification No.18, which fixed the floor price of US 50 per square meter, the present impugned Notification has been issued. Therefore, I do not find any illegality or irregularity in the impugned notification in order to interfere with the same. The reliance placed upon M/s.Mira Commodities case and M/s.Bimal Kumar Modi case by the learned counsel for the petitioner, cannot be made applicable to the present case inamsuch as in the said decisions, it has been held that the DGFT has resorted to amend the import & export policy, which is not permissible under the provisions of FTDR Act, but in exercise of Section 5 of the FTDR Act, the Central Government is only empowered to formulate and announce the export and import policy. Therefore, when the DGFT Notification dated 04.08.2011 allowed free import of marble blocks/tiles provided the CIF value is US 60 and above per sq. mt., the petitioners were expected to declare the same, however, contrary to the same, they have declared below the US 60 and thereby, the authority has rightly confiscated the same and therefore, confiscation of the goods is justified. - Decided against Assessee.
Issues Involved:
1. Jurisdiction of the Director General of Foreign Trade (DGFT) to issue the impugned notification. 2. Validity of the imposed floor price for imported marble. 3. Legality of the confiscation and penalties imposed on the petitioners. Issue-wise Detailed Analysis: 1. Jurisdiction of DGFT to Issue the Notification: The primary contention of the petitioners was that the DGFT lacked the jurisdiction to issue Notification No.65(RE-2010)/2009-2014 dated 04.08.2011. They argued that Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 (FTDR Act) empowers only the Central Government to formulate and amend the export and import policy, and such power cannot be delegated to the DGFT as per Section 6(3) of the FTDR Act. The court examined the relevant provisions and noted that the Central Government is indeed vested with the power to amend the Foreign Trade Policy (FTP) under Section 5, while the DGFT is responsible for advising and implementing the policy. However, the court acknowledged that the DGFT can issue notifications as a delegatee of the Central Government, provided they do not alter the policy's categorization of items from "free" to "restricted." The court found that the DGFT's notification did not change the categorization but merely updated the floor price, which was consistent with previous notifications and within the DGFT's scope of authority. 2. Validity of the Imposed Floor Price for Imported Marble: The petitioners challenged the floor price of US$ 60 per sq.mtr. imposed by the DGFT, arguing that the Central Government should have fixed the minimum import price under Section 14(2) of the Customs Act, 1962, rather than through a notification under Section 5 of the FTDR Act. The court reviewed the historical context of the floor price imposition, noting that the Central Government had introduced floor prices for processed marble products in 2005 and revised them periodically. The court observed that the DGFT's notification was a continuation of this policy and aimed to prevent mis-declaration of import values. The court concluded that the DGFT's action was a procedural update rather than a policy amendment, thus falling within the permissible scope of the DGFT's authority. 3. Legality of the Confiscation and Penalties Imposed on the Petitioners: The petitioners argued against the confiscation of their goods and the penalties imposed by the third respondent, the Joint Commissioner of Customs, under Sections 111(d) and 112(a) of the Customs Act, 1962. The court noted that the petitioners had declared import values below the mandated floor price of US$ 60 per sq.mtr., violating the import policy. Consequently, the goods were liable for confiscation, and the petitioners were subject to penalties. The court upheld the confiscation and penalties, stating that the petitioners' actions contravened the import policy, justifying the enforcement measures taken by the customs authorities. Conclusion: The court dismissed the writ petitions, affirming the validity of the DGFT's notification and the subsequent actions taken by the customs authorities. The court clarified that the petitioners could pursue an appeal against the confiscation order through the appropriate legal channels. The decision emphasized the DGFT's role in implementing procedural updates to the import policy and the necessity for importers to comply with declared floor prices to avoid penalties and confiscation of goods.
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