9911796707
TMI Blog2007 (1) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... und to be 128.486 MTs, showing an excess weight of 8.186 MT's vis-a-vis the declared weight. Subsequently, on detailed examination of the goods by a Chartered Engineer engaged by the Customs authorities, the containers were found to contain 300 used diesel engines of TOYOTA, IZUZU and NISSAN models. The Chartered Engineer reported thus :- The engines examined were found used, and are in need of reconditioning, replacement of parts, fitment of missing parts and thorough overhauling before being put into use. About 40 to 50% of the engines were found with damaged or broken, exhaust manifolds/Inlet manifolds/Fuel injection pumps/starter motors/alternators etc. The nature of damage point to damage in transit or during destuffing. He assessed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns. The show-cause notice also proposed to appropriate this payment towards the demands raised therein. The above proposals were contested by the party in their reply to the notice. In adjudication of the dispute, learned Commissioner of Customs passed the following order (i) I confiscate the Iron Scrap (Mixed) of quantity 83.266 MTs valued at Rs. 5,31,486/- (C.I.F.) under Section 119 of the Customs Act, 1962. However, I give the option to redeem the goods on payment of a fine of Rs. 53,000/- (Rupees fifty three thousand only) in terms of Sec. 125 of the Customs Act, 1962. (ii) I extend the benefit of Customs Notification No. 21 /2002-Cus., dated 1-3-2002 for assessing the Iron Scrap (Mixed) of 83.266 MTs which is to be assessed at the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of breakage, cutting up, wear or other reasons." It is submitted that, even according to the Chartered Engineer's report, the diesel engines were not useable as such on account of damages and, therefore, such engines should have been treated as 'waste and scrap' within the meaning of this expression given above. In that event, there was no mis declaration by the appellants and, therefore, confiscation of the diesel engines by the Commissioner was not warranted. As regards the scrap imported along with the diesel engines, learned Counsel submits that it was not correct for the Commissioner to hold that this material was used for concealment of the engines. Its confiscation under Section 119 of the Customs Act was, therefore, not called for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were not covered under the definition of "Waste and Scrap given under Section Note 8(a). It is submitted that, in similar cases, diesel engines of the same models as imported by the appellants, imported along with heavy melting scrap by certain other parties, were held liable for confiscation under Section 111 of the Customs Act and scrap used for concealing such engines was held liable for confiscation under Section 119 of the Act. In this connection, reference has been made to the Tribunal's decision in the cases of Chandra Enterprises v. Commissioner of Customs, New Delhi [2001 (136) E.L.T. 1068 (Tri. - Del.)] and Orion Business Systems (P) Ltd. v. Commissioner of Customs, Cochin [2002 (141) E.L.T. 411 (Tri. - Bang.)]. It is also pointe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le of being used as such after minor operations such as reconditioning, repairs etc. A different interpretation of the Section Note would not be in keeping with the legislative intent and, on the other hand, can only pave the way for import of serviceable machinery in the guise of 'waste and scrap' by unscrupulous importers. We, therefore, reject the argument advanced by learned Counsel with reference to Section Note 8 (a). 6. It is found that the diesel engines which were serviceable in the aforesaid sense were imported by the appellants by concealing the same in scrap of iron (mixed). The description of goods in the packing list reads thus :- "Mixture of heavy and low melting iron including machinery scrap which contains about 6% alumin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ong with 'heavy melting scrap' and sought to be cleared under a bill of entry which declared the entire material as scrap. The engines were confiscated under Section 111 of the Act and the scrap used for concealing the same were confiscated under Section 119 of the Act. Both the confiscations were upheld by the Tribunal. The facts of the case of Orion Business Systems (supra) are also, more or less, similar. 8. In the impugned order, learned Commissioner imposed a redemption fine of Rs. 2.3 lakhs in lieu of confiscation of the diesel engines valued at over Rs. 23.2 lakhs. In the case of Chandra Enterprises, the redemption fine imposed in lieu of confiscation of diesel engines valued at Rs. 3,18,475/- was Rs. 5 lakhs and the fine imposed in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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