2018 (8) TMI 1527 - AT - Customs

Import of used Digital Multifunction Printing Machine (MFD) - restricted item or not? - Confiscation - redemption fine - penalty - compliance under the Electronic IT Goods (Requirement for Compulsory Registration) Order 2012 - non-registration under BIS - Held that - The Ministry of Communications and Information Technology Department of Electronics and Information Technology vide two communications dt.06.12.2016 10.03.2017 had informed the CBEC that import of second hand Multi Function Printers are neither registered with BIS nor having permission from the Ministry for their import. Such imports would be a violation of the said 2012 order - However a perusal of the Electronics and Information Technology Goods (Requirements for Compulsory Registration) Order 2012 at page 32 onwards of the paper book brings out that although printers plotters find a place at Sl.No.7 8 respectively of the Schedule to the Notification there is no reference to Multifunction Devices - the finding of the lower appellate authority that the impugned goods suffers from non-registration under BIS is flawed and is set aside. Clearance of goods for Home Consumption - Held that - The goods have been imported vide Bill of Entry dt. 03.01.2017. For the imports made till 30.04.2017 no EPR authorization is necessitated - refusal to allow home consumption for this impugned goods on this score cannot sustain - It remains undisputed that the impugned goods are restricted for import as per 2.31 of FTP 2015-2020 and hence will become liable for confiscation under Section 111 (d) of the Customs Act 1962. Nonetheless as there is no absolute prohibition on import of these goods and but only a restriction brought about by para 2.31 of the FTP there is no reason why appellants should not be given an option to redeem the goods for home consumption as per provisions of Section 125 ibid. Goods allowed to be redeemed on payment of redemption fine - Only for the limited purpose of determining the appropriate quantum of such redemption fine the matter is being remanded to the adjudicating authority - appeal allowed in part by way of remand.

Summary

Issues:
1. Determination of value under Customs Valuation Rules
2. Country of origin discrepancy and import restrictions
3. Requirement of compliance under Electronics and IT Goods Order, 2012
4. Classification of goods as hazardous waste
5. Denial of clearance for home consumption and imposition of penalties

Issue 1: Determination of value under Customs Valuation Rules:
The appellants imported a Digital Multifunction Printing Machine (MFD) which was re-determined in value under Rule 9 of the Customs Valuation Rules. The original authority re-determined the value, confiscated the goods, and imposed penalties under the Customs Act, 1962. On appeal, the Commissioner (Appeals) upheld the re-determination of value but denied clearance for home consumption, leading to this appeal.

Issue 2: Country of origin discrepancy and import restrictions:
The goods were imported from New Zealand, but the Chartered Engineer certificate mentioned China and Japan, leading to a discrepancy. The goods were also found to be covered under Schedule VIII of the Hazardous and other Waste Rules, with restrictions under the Foreign Trade Policy 2015-2020. The appellants lacked valid authorization for import, resulting in confiscation and penalties.

Issue 3: Compliance under Electronics and IT Goods Order, 2012:
The appellants argued that the used MFDs were not covered under the Electronics and IT Goods Order, 2012, as they are a combination of printer, scanner, and copier. The Commissioner (Appeals) held that the goods required registration under the 2012 order, but the Tribunal found that MFDs did not have a specific entry in the schedule, citing a High Court order to support their decision.

Issue 4: Classification of goods as hazardous waste:
The original authority classified the goods as "Other Wastes" under the Hazardous Waste Rules, leading to denial of clearance for home consumption. The appellants presented a decision from the Technical Review Committee indicating that no EPR authorization was required for imports made until April 30, 2017, supporting their argument against the classification as hazardous waste.

Issue 5: Denial of clearance for home consumption and imposition of penalties:
While the goods were restricted for import under the FTP 2015-2020, the Tribunal found that there was no absolute prohibition, allowing for redemption of the goods for home consumption under Section 125 of the Customs Act. The denial of clearance for home consumption was set aside, and the appellants were allowed to clear the goods for home consumption on payment of redemption fine and applicable duties.

In conclusion, the Tribunal remanded the matter to the adjudicating authority for determining the appropriate redemption fine, allowing the clearance of the goods for home consumption with suitable conditions.