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TMI Blog2008 (6) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... ed orders with M/s. GE Hangwei, China one of the constituents of their JV Partner for supply of complete CT scanners. However, noticing that the duty on complete CT scanner was higher than the duty on parts of scanner and also being advised that China does not permit import of parts of scanner, but only the complete scanner, they in consultation with their freight forwarder who was also Custom House Agents in the present case and the present appellant, decided to describe the goods as complete scanner in their Master Air Way Bill and split the Master Air Way Bill into House Air Way Bills giving different description, so as to project to the Revenue, that only parts of the CT scanners were being imported by suppressing the actual description in the Master Air Way Bills. The consignment was split into two, one imported at Bangalore and the other at Mumbai describing it as parts of CT scanner even though the Master Air Way Bill described them as complete CT Scanner. Even though the CT Scanner consisted of 75 and more component parts, only 7 to 8 sub-systems were imported evidencing that they were just sub-assemblies and not parts. As per statement dated 2-2-2001 of Shri Anup Mam, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,00,000/- on its employee but dropped the proposition in the show cause notice for suspension of licence under Regulation 21 of the Custom House Agents Licensing Regulations, 1984. An appeal was filed by M/s. Exel and its employee against both the orders before the South Zonal Bench and West Zonal Bench and Tribunal vide its order dated 29-9-05 in respect of Mumbai Commissionerate and order dated 22-8-2006 in respect of order of Bangalore Commissionerate has set aside the penalties imposed on M/s. Exel and its employee taking note of the fact that it has extended the benefit of Notification to parts also even though the goods were considered as complete unit in their own case for subsequent imports and in those cases the decision was upheld by Hon ble Supreme Court as seen, from the order reported in 2001 (111) A54 (S.C.). It was held that when M/s. WGEMS itself cannot be held guilty for misdeclaration, then it cannot be held that M/s. Exel and its employee have aided and abetted the importer. 2. Separate proceedings were initiated against M/s. Exel for suspending/revoking their licence in terms of CHA Regulation Rules and accordingly show cause notice was issued to them requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... do so for the entire custom house i.e. Mumbai Custom House in the present case. 5. As regard merits it was submitted that the exemption to parts were available even in respect of CT scanner machine imported in SKD condition as has been held by the Tribunal in their own case and in the appeals filed by them against the orders of Commissioner Bangalore and Commissioner Mumbai in both of which penalties imposed on the CHA have been set aside. It was accordingly submitted that even if the machines are imported in parts in SKD condition and declared as parts no irregularity has been done by them in giving description in the bill of entry as parts, as the goods were in the nature of parts and the same has not led to any evasion of duty as alleged. Once the activity of declaring the goods as parts, itself is not illegal, their action describing the goods as parts in the Bill of Entry cannot be considered as violation of CHA Licence regulation which require them to declare the correct description of goods in the Bill of Entry as has been held by Commissioner. Since on this very ground the penalty imposed on them had been set aside, they cannot be made a ground for prohibiting them from w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts Licensing Regulation, 2004. These two Articles of Charges have been held proved by the Inquiry Officer in the Inquiry. 28. Their act had only helped the importers to fraudulently avail the benefit of the Customs Notification No. 16/2000 and defraud the exchequer its due Revenue. It is also noticed that though the source documents for the importation of the subject goods being the Purchase Order raised by the imports on their GE family Unit from China the reference of which was available with them, they had not taken the pains of producing the Purchase Order to the Customs at the time of assessment and clearance of the subject goods which would have shown that the goods imported are CT/e SKD Kits which were not eligible for the duty benefits under Customs Notification No. 16/2000. The e-mail of their counterpart in China Oliver Zhang had discussed the problem faced, which was that they could only export complete CT/e machine and the problem at India was that they could only imports parts. He had then gone on to suggest various ways of overcoming this and has suggested that separate HAWBs be made and the shipment be cleared at China using MAWB which will show the description c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Hon ble Tribunal, it is apparent that the issue was contentious and CHA has ill-advised his client. The interpretation of the Hon ble Tribunal does not change the fact that the Master Air Way Bill carried different description when compared with the description given by the CHA in the Bills of Entry. Hence, there is no hesitation to state that the CHA has failed to discharge his duties to get undue benefits by misdeclaring the goods as parts. Their conduct does not get vindicated even if the advantage to the Importer has been granted by way of interpretation. Hence, I hold that he has violated Regulation 13(d) and 13(n) of the CHALR, 2004 32. In this regard, I find that they are misplaced in understanding the substance of the CESTAT s order. The CESTAT gave liberty to the Commissioner of Customs to take a decision under CHALR. The penalties levied under the Customs Act, 1962 were set aside by the CESTAT, but the action under CHALR is pending, which is to be taken by the Commissioner of Customs. 35. I do not find any valuable reason to argue about the issue raised by the CHA that the charge in the show cause notice issued by the DRI under Customs Act, 1962 with regard to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al product was different from defence of bona fides in a case where circumstances mentioned in proviso to Section 11A(1) of Central Excise Act, 1944 stands proved by department for invoking larger period of limitation, burden to prove defence of bona fides is on assessee who failed to discharge it. Similar view was taken in case of Mahindra - 2005 (179) E.L.T. 21 (S.C). In the present case the importer M/s. Wipro have themselves admitted all the allegations in the show cause notice of mis-describing the goods before the Settlement Commission and have paid duty leviable on complete machine even though the machine was imported in SKD condition and further accepted the liability to pay interest as held by the Settlement Commission, even though the Apex Court decision in the case of BPL India v. CCE, Cochin - 2002 (143) E.L.T. 3 (S.C.) = 2002 (50) RLT 249 (S.C.) CEGAT decision in the case of SAB Electronics Ltd. v. CC, New Delhi - 2001 (132) E.L.T. 161 (T) 2001 (44) R.L.T. l37 (T) and the Tribunal decision in their own case - 1999 ((106) E.L.T. 169 (T) which was confirmed by the Apex Court as reported in 2000 (117) E.L.T. A54 were very much in their knowledge and were referred to by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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