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TMI Blog2013 (2) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... ntial requirement for moving the vehicle from the showroom or the factory to the airport. To verify whether the registration is a technical formality or not, the field formations may compare the date of dispatch of the car with the date of registration – In this case, the car has been registered with the UK authorities on 20-5-2005 and was exported to India within 9-6-2005 i.e. almost within 19 days of its registration and the registration certificate clearly explicit that the vehicle is for direct export and cannot be used on UK roads prior to export. This clearly indicates that the vehicle is registered only for export purposes. Therefore, in terms of Board’s Circular No. 1/2005, dated 11-1-2005, the vehicle is a new one. Further name and address of the manufacturer of complete vehicle is M/s.“Toyota Motor Engineering & Manufacturing Europe SA/NV”, Bruxelles (Brussels). If the name of manufacturer is correct then allegation of forged TAC is not sustainable as held by Hon’ble Apex Court in the case of Parminder Kaur Parminder Kaur v. State of UP[2009 (10) TMI 657 - SUPREME COURT ], wherein the Hon’ble Apex Court has held that not every interpolation or tampering with a document ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellants mentioned this matter before the Bench on 27-7-2011 and sought out-of-turn hearing without having filed any early hearing application. Early hearing application can be filed only in certain specified situations as per the practice and precedent at Mumbai, namely :- (i) High revenue stakes (over Rs. 1 crore) (ii) Matter having recurring effect, (iii) Matter relating to a live consignment, or (iv) The issue being a covered matter . The grounds stated in the mentioned application did not relate to any of these issues. Therefore, the mater could not have been listed for out-of-turn hearing, that too, without any EH application. In spite of my strong objections, the mention application was allowed by the Bench and matter was listed for final hearing on the very next day, that is, on 28-7-2011. It was directed in the open court that the matter would be listed last in the Cause list of 28-7-2011 and would be taken up only if the Bench had spare time after exhausting all the matters in the regular Cause List for 28-7-2011. He further submitted that on 28-7-2011 he fell ill and could not attend office and the proxy DR sought adjournment. His request ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 9-8-2011, the Hon ble President modified the sitting of the Bench with a direction that the appeal in hand be heard till its conclusion. Therefore, the matter was heard on 10-8-2011. On 10-8-2011, when the matter came up for hearing, the learned Jt. CDR further raised objection that as per stay order in this case, the appellant was required to satisfy two conditions i.e. kept the two Bank guarantees of Rs. 2 lakhs and Rs. 10 lakhs alive till the disposal of the appeal and the appellant would not dispose of the car till the disposal of the appeal. He submitted that he has received a letter from the Commissioner of Customs (Import), New Customs House, Mumbai that the two Bank guarantees had lapsed long time back and despite the repeated request, the appellant has not renewed the same. Therefore, he made a request to dismiss the appeal for non-compliance of the provisions of Section 129E of the Customs Act, 1962. 7. On query of the Bench, the learned Counsel for the appellant submitted that as per his knowledge the Bank guarantees are alive and sought to get confirmation from the appellant and to produce the proof for the same before the Bench. The matter was adjourned till 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Jt. CDR further submitted that the Bank guarantees have been lapsed on 6-12-2009 and 23-8-2010 respectively, therefore, during the impugned period the stay order was not complied with. Hence, the appeal is to be dismissed. 9. We have gone through the records before us and vide order dated 1-4-2009 this Bench has extended the order of grant of stay on the condition imposed earlier subject to keeping the Bank guarantees enforceable by the appellant. As the Bank guarantees were alive on 1-4-2009, this Tribunal extended the grant of stay. If the time of Bank guarantees was to expire, it is the duty of the Commissioner before whom the Bank guarantees were executed to encash the Bank guarantees in the event, if the same is not extended and to move to the Tribunal for dismissal of the appeal for non-compliance of the provisions of Section 129E of the Customs Act, 1962 before final hearing. As admitted by the learned Jt. CDR, the Bank guarantees have been expired on 6-12-2009 and 23-8-2010, no steps have been taken by the concerned Commissioner for encashment of bank guarantees or for a prayer to the Tribunal for dismissal of the appeal for non-compliance of stay order dated 8-8-2007. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted a TAC issued by service Public Mobilite et Transports Bruxells. On examination of the certificate, it was found that at Sr. No. 0.5 0.8, the name of manufacturer/assembly plant was mentioned as Toyota Motor Engineering Manufacturing Europe, Brussels. The enquiry with M/s. Toytoa Kirloskar Motors, Bangalore, however, revealed that the vehicle was manufactured in Japan. As per para 7 of the Import Licensing Notes under Chapter 87 of Classification of Import Export items 2004-2009, the TAC has to be submitted from the country of Origin, i.e. Japan in this case. The appellant stated that DGFT s Policy Circular 5/2004-09 dated 15-10-2004 allows clearance of car on submission of TAC from a country other than country of origin also. As it was not clear whether TAC from a place, other than country of origin, could be accepted, and the appellant submitted only a copy of the TAC, it was decided to allow the clearance of vehicle provisionally on submission of Bond with Bank Guarantee. (vi) The vehicle was released provisionally on 5-8-2005 after payment of full duty and furnishing of ITC Bond for Rs. 8 lakhs with cash deposit of Rs. 2 lakhs in lieu of Bank Guarantee as th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, a show cause notice was issued on the charges that the appellant has misdeclared the car as new, therefore, the appellant has rendered the car liable for confiscation under Section 111(m) of the Customs Act, 1962 and also as the appellant had knowingly and will fully declared the car as new to evade payment of the applicable Customs duty, by this act has rendered himself liable to penal action under Section 112(a) of the Customs Act, 1962. (x) The show-cause notice was adjudicated and it was held that the car is used one, which was declared as new is liable to confiscation under Section 111(m) of the Customs Act. Since the appellant has deliberately attempted to mislead the department by submitting forged documents and also attempted to evade duty as well as circumvent the licencing requirements, he is liable for penal action under Section 112(a) of the Customs Act. The Commissioner ordered that since the car is used one, therefore, the appellant is liable to pay differential duty of Rs. 11,43,304/-, a redemption fine of Rs. 12 lakhs and a penalty of Rs. 10 lakhs under Section 112(a) of the Customs Act, 1972. Aggrieved from the said order, the appellant is befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on 9-6-2005. Therefore, there is only a fortnight between the date of registration and the date of shipment. The dates are sufficiently proximate to indicate that the car was not registered for use in the UK and the benefit of the circular dated 11-1-2005 should be given to the appellant. The said circular has not been considered in the impugned order. In the impugned order, it is referred that the registration certificate issued by the UK authorities and attention has been drawn to the warning. However, the said order does not refer to a material part of the document which states that vehicle purchased for direct export cannot be used on UK roads prior to export . This makes it abundantly clear that the car was not used in the UK and was merely registered for the purpose of export. The order erroneously held that the warning contains the condition that the Commissioner of Customs Excise, UK can authorize the buyer to use the car to UK. However, there is no such statement in the warning mentioned in the registration. The Commissioner is only empowered to authorize the transfer of the car in the UK, and not the use of the same. (d) It is also pertinent to note that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Metro Palace Hotels Pvt. Ltd. v. Commissioner of Customs (Import), Mumbai-II - 2008 (227) E.L.T. 234 (Tri.-Mum.), it was held that the onus is on the customs authorities and the authorities have full knowledge of which cars are imported into the country. It is for them to demand a TAC for the first import of a car. In case no such specific demand is made by the authorities, it is open to the importer to believe that no TAC is required. (h) He further submitted that the TAC is not required in case import from Japan as it is settled that Japan does not issue an TAC as held by the Tribunal in the case of J.S. Gujral v. Commissioner of Customs, New Delhi - 2008 (225) E.L.T. 265 (Tri.-Del.). In the case of Jagat Malkani v. Union of India - 2010 (253) E.L.T. 718 (Bom.), it was held that no TAC can be insisted upon since the law cannot compel someone to do the impossible. (i) As TAC was not required, there was no reason for the appellant to have forged any document. He further submitted that in any event it is not necessary to provide a TAC from Japan and the TAC issued from any country which is a signatory to the 1958 agreement under WP29 would suffice. Belgium is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard, reference may be had to Section 11A of the Excise Act which is in pari materia with Section 28 of the Customs Act. The Hon ble Apex Court in the case of Commissioner of Central Excise v. ITC - 2006 (203) E.L.T. 532 has held that a proceeding under Section 11A of the Act cannot, therefore, be initiated without completing the assessment proceedings. In this case there was only a provisional assessment as evident from the Bill of Entry, therefore, without finalization of provisional assessment, show-cause notice cannot be issued. As show-cause notice has been issued under Section 28 of the Customs Act, which cannot be issued, therefore, the Commissioner has no power to pass the impugned order. In the result, the impugned order is without jurisdiction and is a nullity.. It is well settled that such an order can be assailed on this ground at any time and at any stage of the proceedings as held by the Hon ble Apex Court in the case of Kiran Singh v. Chaman Paswan - AIR 1954 SC 340. (m) He further submitted that in the show-cause notice, the provisions of Sections 111(d) and 111(m) have been invoked for confiscation of car. The show-cause notice proposed the confiscation of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levy, confiscation and penalty are being void ab initio due to lack of jurisdiction to issue demand notice under Section 28 read with 124 of the Act. Therefore, he prayed that the impugned order be set aside and the appeal be allowed with consequential relief. 13. On the other hand, Shri A.K. Prasad, learned Jt. CDR, strongly opposed the arguments advanced by the learned Advocate. He submitted that the appellant has imported the used car and he is not eligible for exemption under Notification No. 21/2002-Cus. as the said Notification applies to a new car only. Since the appellant is claiming the benefit of Exemption Notification, the burden is on them to show that he is eligible for the exemption. To discharge this burden, they have mainly relied on two documents, viz. (a) A Registration Certificate of the car from UK showing the date of registration as 20-5-2005, and (b) Board s Circular No. 1/2005-Cus., dated 11-1-2005. 13.1 With regard to the Registration Certificate, the adjudicating authority has dealt the issue in detail and held that the same cannot be accepted as the appellant has not been able to show any provision of UK law which required them to register the car bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... car was the first car of that model imported into India. In fact the Bench did not properly appreciate the issue at hand. Since the appellant is claiming exemption from production of homologation certificate as required under the relevant import policy provisions, the burden is on him to establish that they are eligible for exemption. As in the present case the appellant has not been able to establish that a car of the same model had earlier been imported in India supported by a homologation certificate. This verification could have been done from the manufacturers themselves who maintain detailed accounts of export of various models to different countries. Alternatively, even if it is accepted that the imported car was a new one, then as per the relevant policy provisions, two conditions were required to be complied with, viz. (i) the car had to be imported directly from the country of manufacture, and (ii) it should be accompanied by a TAC from an accepted agency from the country of origin. As the first condition was contravened by the appellant since the country of manufacture was Japan, whereas the car was directly imported from UK and hence the car became liable for confiscati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y from Japan, whereas in the instant case the car has been imported from U.K. (ii) In the case of J.S. Gujral (supra), the case was meant for the Japanese market and hence the appropriate authority in Japan clarified that they were not in a position to give any TAC required as per the India law. In the present case, the car was not meant for use in Japan but was designed for use in Europe. When a company manufactures a car of the same model but for different global market it obviously carries out requisite changes/modification to conform to the specifications of that market. Thus, the same model of the car designed for use in Japan would not have the same specifications when it is designed for use in Europe because each country has its own requirements to conform to local laws. Thus, the letter issued by the Japanese authorities in the case of J.S. Gujral in respect of a car which was designed - for use in Japan cannot be applied or used in respect of import of the car of the appellant which was designed for use in Europe. (iii) Further, the letter of Japanese authorities in case of J.S. Gujral relates to the year 2007 whereas the import of the appellant was made in 2005. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red within the European Union only and in that case the TAC can be given by any other member-country of manufacture of the car. This clarification was not available in the case of Vikram Tannan (supra). The appellant also relied on the Ankneedu Maganti (supra). In that case also, the car was also imported directly from Japan. In view of the above submissions, he submitted that the appeal be dismissed. 14. After considering the submissions from both sides, we find that the following issues are involved in the matter :- (a) Whether the car in question is a new car or old one? (b) If the car is new one, whether the appellants are entitled for - (i) exemption under Notification No. 21/02 at Sr. No. 344(2), (ii) Whether TAC is required or not? (iii) If required, whether the certificate produced by the appellant is forged, therefore the vehicle is liable to be confiscated under Section 111(m) of the Customs Act, 1962 and consequences thereof? (c) If the car is an old one, whether the homologation certificate is required or not and whether the appellant is liable to pay differential duty and the vehicle is liable for confiscation under Section 111(m) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the car is an old car. 17. For better appreciation, the Registration Certificate is reproduced herein as under :- 18. We have perused the registration certificate, which clearly states that vehicle purchased for direct export cannot be used at UK roads prior to export. The adjudicating authority has failed to consider the registration document properly as registration document itself says that vehicle purchased for direct export cannot be used on UK road prior to export and has not recorded any finding on it, which clearly shows that the adjudicating authority has not examined the registration certificate properly/correctly for holding the car as an old one. 19. As per Board s Circular No. 1/2005-Cus., dated 11-1-2005, the Board has clarified that a new imported vehicle for the purpose of this chapter shall mean a vehicle that has not been registered for use in any country according to the laws of that country, whereas as per the referred Customs Notification, it should not be registered anywhere prior to importation. It was also noted that in many countries, registration of the vehicle is an essential requirement for moving the vehicle from the showroom or the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he departmental authority on 3-8-2005 and it was stated that the car was new one, therefore, the car was released on ITC Bond on 4-8-2005 and as per the condition of the Bond, the appellant was required to provide TAC within six months, which was complied with by the appellant and once the condition of the Bond is complied with, the SCN cannot be issued. He also submitted that no TAC or certificate of origin is required to be submitted by the importer as held by this Tribunal in the case of Ankineedu Maganti (supra), wherein this Tribunal has held that the TAC/COP of an International Accredited Agency needs to be produced for goods/car which came into India for the first time. Once a similar car is imported and has cleared, TAC for the subsequent import need not to be insisted upon. The ld. Jt. CDR submitted that the said decision is a wrong decision. The ld. Jt. CDR submitted that in this case, the car was imported from Japan directly and we find that this Tribunal has laid down the principle that the TAC is required for first import of the car and not for every subsequent import. The TAC of the car confirms the technical specification. Once such TAC is provided for one Car, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that TAC is an essential requirement. Therefore, if we consider the submission made by ld. Jt. CDR that the said decision is of no value, in that circumstance TAC is not required, which is not correct. Therefore, following the decisions of this Tribunal in the case of Ankineedu Maganti (supra) Metro Palace Hotel (supra), which have been accepted by the Revenue, we hold that the TAC is not required. 24. The Revenue has also disputed that the TAC is a forged one, as in that regard, the appellant has submitted that as TAC was not required, therefore, there is no reason to produce a forged document. He also clarified that the allegation of the Revenue is that forged TAC has shown that car was manufactured in Bruxelles (Brussels), but in fact the car was manufactured in Japan. In fact the allegation of the Revenue is that the alteration has been done on the second page of the TAC. On first page of TAC, there is no allegation that the same is forged one and on page 1, it clearly shows the name and address of the manufacturer of the complete vehicle as Toyota Motor Engineering Manufacturing Europe SA/NV , Bruxelles (Brussels). Therefore, the car was manufactured in Belgium and not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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