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TMI Blog1994 (6) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Act. He has given an option under Section 125 of the Act to redeem these goods on payment of a fine of Rs. 50,000/- only. (iii) Order for confiscation of household articles under Section 111(d) and 111(l) of the Act. He has given an option under Section 125 of the Act to redeem these goods on a fine of Rs. 10,000/- only. He has rejected the claim of T.R. Rules benefits and has held that the goods shall be cleared, if redeem on the payment of duty. (iv) He has ordered for confiscation of the fax machine under 111(l) of the Act but has given an option under Section 125 of the Act for the importer to redeem the machine on payment of fine of Rs. 10,000/- and payment of duty at normal rate. Ld. Collector did not impose any penalty on the importer under Section 112 of the Act. Likewise, he has dropped the charges of undervaluation in respect of the CAT Scan, X-ray tube and the Oscilloscope as unsubstantiated, in the absence of any evidence to the contrary, the declared transaction values has been accepted. 3.(i) The facts of the case are that the appellants filed a Bill of Entry No. 151815 dt. 7.9.90 at the Container Freight Station, Patparganj, for the clearance of goods d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was alleged that the declared value was liable to be rejected and the goods were liable for confiscation under Section 111(m) of the Act. It was also alleged that the goods which were found during the examination were not covered by any licence and hence they were liable for confiscation under Section 111(d) and 111(l) of the Act. It was further alleged that as a corollary to the various allegations above cited, that the importer was also liable for penalty under Section 112 of the Act. The importer had also claimed concessional rate of duty for the medical equipment under Custom Notification No. 138/88 which was also alleged to be not available to the importer since one of the conditions is that the importer should have affirmed an oath before a notary of the country from where the importer came and such an oath has not been affirmed in the subject case. Based on the allegations as cited herein before, a show-cause notice dt. 21-6-1991 was issued to the importer. References to certain statements under Section 111(d) of the Act deposed by the importer and her husband/power of attorney holder Shri Prem Kapoor, were also taken notice of. The importer had stated that the price of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Oscilloscope. The Oscilloscope was also described as a Calibration Oscilloscope Analogn (Hitachi V-525). They also submitted vide their letter dt. 2-12-1991 copies of affidavits from certain persons said to be authorised equipment dealers, in the USA. The Collector did not accept these affidavits as not being relevant to the equipment in dispute since these goods have been shipped out of the USA as far back as May 90 while the affidavits were of October/Nov 91. On the question of the accessories not being included in the licence and the main equipment being older than permitted in the import policy/licence, the importers had represented to the Chief Controller of Imports and Exports,New Delhi, who issued a recommendatory letter No. CG-II/14/INSA/90-91/82 dt. 14-8-1991 addressed to the Collector of Customs, New Delhi. The C.C.I. E. recommended that since the imports are by an NRI from his own earnings abroad and proposed to be used to set up an advanced medical diagnostic centre, Customs might consider allowing clearance of the goods, provided there was no objection otherwise. 4. Before the Collector, the importer had stated that with the issue of C.C.I. E s letter dt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Srivastava and ld. JDR Shri S.K. Sharma. Ld. Advocate pointed out to the certificate issued by the Chartered Enginner who has clearly certified that the exepected residual life of the equipment will be for another 12 years atleast from the date of the certificate, which is 3rd May, 1988. Therefore, he submitted that the finding of the ld. Collector that the life of the equipment is less than 7 years, is an erroneous finding. He also submitted that the other condition of the notification that the affidavit should have been notarised abroad is only procedural violation and as collarary evidence had been submitted, the Collector ought to have accepted the same and held that they were entitled for the benefit of the notification in question. He submitted that the entire equipment fell within the licence and that the Licencing Authority had clarified that there was no licencing violation and in that view of the matter, the finding of the ld. Collector that PCBs fell under Apx. 2B S. No. 160, ICs are allowed for Actual Users (Indl), the X-Ray tube is covered under Apx. 3A S. No. 722 and that the oscilloscope is not allowed for import as per S. No. 35 of Apx. 8 read with para 36 (i) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orts Exports had directed that the Customs may consider allowing clearance of the goods, provided there was no objection otherwise, it meant that the word `may is not discretionary but should be read as `shall in terms of Section 21 of the General Clauses Act. In this context, he relied on the citation as appearing in AIR 1963 SC 1618 and AIR 1977 SC 1516. He submitted that the allegation in the show-cause notice pertained to non-grant of benefit under Notification 138/88 were different, while the ld. Collector had gone beyond the allegation made in the show-cause notice and had desired the benefit on a different ground. As regards the non-declaration of household goods, the ld. Counsel submitted that as per Section 44 of the Customs Act, there is no need to file bill of entry for clearances under Baggage Rules and there can be a declaration orally also. He submitted that the importers had returned to India with a genuine interest to settle down, to serve the nation after having been NRI for more than 20 years. They were Engineers and that there was no mala fide intention to evade duty by mis-declaring the goods. 6. Ld. JDR Shri S.K. Sharma reiterated the findings given by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 160, ICs are allowed only for actual users (Indl), the X-ray tube is covered under Apx. 3A S. No. 722 and that the oscilloscope is not allowed for import as per S. No. 35 of Apx. 8 read with para 36(1) of Import Policy 1990-93 and all of which call for a valid import licence, which has not been produced and hecne on this issue, the ld. Collector has ordered for confiscation and granted redemption on payment of fine. We are not impressed with this findings given by the ld. Collector on this issue. The reason being that the licencing authority has been satisfied with the three medical equipments as being covered under the licence. Further all these accessories are part and parcel of the three medical equipments and that the same cannot function without the same. Although these four equipments namely PCBs, IC X-Ray tube and oscilloscope if imported independently may require to be classified separately but all these are parts and accessories which go along with the main equipments and hence the CCI E has rightly held that they are covered by the licence. It is to be noted that the invoice of the supplier and the clarificatory letter issued by them clearly shows that these are part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s clear that where there is a procedural violation, it has to be construed as violation of a technical nature, so long as there is no violation of substantive condition of the notification. There is no allegation in this case that there is a substantive violation of the Notification No.138/88-Cus. and in that event of the matter substantive benefit cannot be denied to the importer, on the mere fact that a notarised affidavit of their residence abroad has not been produced by them. There is on records the various other certificates including the letter of CCI E which cannot be ignored and the importers denied the benefit. 9. As regards the charge that the household items had not been declared in the bill of entry and same are liable for confiscation and imposition of fine, we are not impressed with the findings given by the ld.Collector, for the simple reason that the household items have been declared under the baggage rules and as rightly pointed out by the ld. Advocate that as per Section 44 of the Customs Act, the Chapter VII does not apply to (a) baggage and (b) goods imported or to be exported by the post. Chapter VII deals with clearance of imported goods and export goods ..... X X X X Extracts X X X X X X X X Extracts X X X X
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