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TMI Blog2007 (6) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... ce issued by the WPC (Wireless Planning & Coordination) wing of the Department of Telecommunications under the Ministry of Communications and Information Technology (hereinafter referred to as WPC licence). A Separate licence from the same authority was required for establishing and operating the equipment. For obtaining this licence (called operating licence) the applicant was required to satisfy the licensing authority that the equipment conformed to the technical parameters such as frequency, emission, bandwidth etc. laid down by the said authority. Under the EPCG scheme, the appellant-company was required to fulfil their export obligation in relation to the imported capital goods within a period of 8 years from the date of issue of EPCG licence. Within this period, export obligation should be discharged in the following proportions Block of 1st and 2nd years - Nil Block of 3rd and 4th years - 15% Block of 5th and 6th years - &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SIIB also found that the appellant-company had obtained a permission from the Ministry of Information & Broadcasting to use DSNG equipment for getting live feeds from the States of Tamilnadu, Andhra Pradesh, Kerala and Karnataka to be downlinked at their earth station in Chennai for permitted TV channels. This permission was seen to have been communicated in the Ministry's letter dated 5- 8-2003. SIIB did not accept this permission as substitute for WPC licence. Further, they found that the appellant-company had applied for such licence on 16-10- 2003 only and were yet to receive the licence. Statements were recorded from Shri M. Raajhendran, Managing Director of the company (appellant in Appeal No. C/294/2005), Shri M. Raveendran, Director of the Company (appellant in Appeal No. C/295/2005) and Shri E. Kirubakaran, Senior Engineer - Maintenance of the Company, under Section 108 of the Customs Act. Any WPC licence or installation certificate was not produced by the appellants even during the course of investigations. 4. On the basis of investigative results, the Department issued show- cause notice dated 8-2-2005 to the appellant-company, its Managing Director and 3 other Directo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of Rs. 57,75,940/- paid on 21-5-2005, the remaining amount of Rs. 6,56,335/- and interest as applicable shall be paid within 10 days from the date of receipt of this order, failing which the bank guarantee and bond executed. in their behalf is enforceable; (d) I order that the goods imported vide 10 Bills of Entry valued at Rs. 1,40,44,270/- is held liable for confiscation under Sec. 111 (o) of the Customs Act, 1962. However, I impose a redemption fine of Rs. 70,00,000/- (Rupees Seventy lakhs only) in lieu of confiscation; (e) I impose a penalty of Rs. 1,90,00,000/- (Rupees One crore ninety lakhs only) on M/s. Raj Television Network Ltd. under Sec. 112(a) of the Customs Act, 1962; (f) I impose a penalty of Rs. 50,00,000/- (Rupees Fifty lakhs only) on Shri M. Raajhenndran, Managing Director of M/s. Raj Television Network Ltd. under Sec. 112(a) of the Customs Act, 1962; (g) I impose a penalty of Rs. 10,00,000/- (Rupees Ten lakhs only) on Shri M. Raveendran, Director of M/s. Raj Television Network Ltd. under Sec. 112(a) of the Customs Act, 1962; (h) I impose a penalty of Rs. 10,00,000/- (Rupees Ten lakhs only) on Shri M. Rajarathinam, Director of M/s. Raj Television Network ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no misclassification by the importer, Counsel argued. Without prejudice to this argument, learned Counsel submitted that there was no mens rea in misclassification, unlike in misdeclaration. He relied on the Karnataka High Court's judgment in Commissioner of Customs, Bangalore v .A. Mahesh Raj - 2006 (195) E.L.T. 261 (Kar.) to bring out the distinction between misclassification and misdeclaration. In respect of the DSNG equipment, learned counsel further pointed out that WPC licence had since been produced before the Commissioner and provisional release of the equipment obtained by the appellants in terms of Miscellaneous Order No. 512/2007 dated 31-5-2007 passed by the Tribunal in Appeal No. C/293/2005. He also suggested that the matter relating to DSNG equipment be remanded to the Commissioner for fresh decision. As regards other equipments it was submitted that the Commissioner had misinterpreted the condition pertaining to installation certificate. Commissioner had misunderstood the expression 'completion of imports' as 'completion of each import'. Counsel pointed out that some more equipments mentioned in the EPCG licences were yet to be imported, and argued that Notification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tates by downlinking to their licensed earth station at Chennai for permitted TV channels subject to condition that uplinking should be in 'C' Band by using 3 MHz capacity on THAICOM - 3 satellite. But, as per the technical parameters laid down by the WPC Wing of the Department of Telecommunications under the above Ministry through letter dated 24-5-2007 addressed to the appellant-company [produced along with Import Licence dated 25-5-2007], the allocated bandwidth was 2 MHz and, that too, on INSAT 2E satellite network. On this basis, learned JDR submitted that it was difficult to correlate the Import Licence dated 25-5-2007 produced by the appellants with the DSNG equipment imported by them. Referring to the condition relating to installation certificate, the DR supported the Commissioner's finding, by submitting that the import period allowed by the DGFT was 24 months only and that no extension of this period had been obtained by the appellant-company. The import period had expired long ago and hence there was no question of any further imports by the company under the EPCG licences. The DR also supported other findings of the Commissioner. 8.1. We have given careful considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p; DATED : 25-5-07 LICENCE TO IMPORT WIRELESS TRANSMITTING AND/OR RECEIVING APPARATUS INTO INDIA In pursuance of Notification No. 71-Customs dated September 25, 1953 issued Section 19 of the Sea Customs Act, 1878 (VIII of 1878) the Ministry of Communications & Information Technology of the Government of India (hereinafter called the Ministry) hereby grant to: M/S. RAJ TELEVISION NETWORK LTD. 32, FOES, ROAD, 2nd STREET TEYNAMPET, CHENNAI -600018 (Hereinafter called licensee) during the term/period commencing on the day of the date hereof, and terminating on the last day of 24-8-2007 Licence and permission to import at CHENNAI the following apparatus for Wireless Telegraphs: ITEM NO. DESCRIPTION OF APPARATUS MODEL OR TYPE NO. AND MANUFACTURER FREQUENCY BAND (in MHz) POWER QUANTITY AS PER ANNEXURE-I This is only a clearance from technical angle and does not pertain to administrative and/or financial aspects of import. Please note that grant of import licence does not imply permission to establish, and operative a W/T equipment. A separate licence will be required for operational usage of equipment. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DIRECTOR The covering letter of the licensing authority, dated 25-5-2007, for the above import licence indicates that the licence was issued with reference to letter dated 24-5-2007 of the appellant-company. The licence is apparently not one issued with reference to the application dated 16-10-2003 submitted by the company. Further, the above licence permits the company to import at Chennai the equipments specified in the Annexure during the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an importer cannot be accused of having 'misclassified' the goods imported by him. 8.2. It appears from the record of evidence in this case that this equipment, after its clearance, was mounted on a vehicle and put to use as mobile unit for the intended purpose by the appellants. The company's Chartered Account ant's certificate, produced by counsel, shows that, out of use of the imported equipments, they could achieve substantial exports (to the extent of US $ 783423 up to 17-7-2006) under the EPCG scheme. However, the requisite installation certificate was not produced within the period prescribed under Notification No. 55/2003-Cus. or thereafter. It has been argued by learned Counsel that it was not necessary to produce installation certificate after each import and that such a certificate was required to be produced only after completion of imports under the EPCG licences. This argument cannot be accepted for the reason that each EPCG licence had prescribed a period of 24 months for completing imports thereunder and the licensing authority was never approached for extension of the period with the result that no further imports were possible after the expiry of the above period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the view that the penalty of Rs. 1.90 crores imposed on the company by the Commissioner is unconscionable. We reduce this penalty to Rs. 25,00,000/- (Rupees Twenty-five lakhs only) in the facts and circumstances of the case. 8.4. We have not accepted ld. Counsel's argument that the demand of duty before expiry of the period prescribed for discharge of export obligation is premature. The demand is consequential to the assessee's failure to comply with another mandatory requirement under the exemption Notification, i.e., production of installation certificate from the jurisdictional Assistant Commissioner or Deputy Commissioner of Central Excise. Non-fulfilment of export obligation is not a ground for the demand of duty on the assessee. The decision in Sharpscan & Prints (supra) is not applicable to the present case as, in that case, the party was challenging a demand of duty which was raised on the sole ground of non- fulfilment of export obligation. 9. In the result, Appeal No. C/293/2005 gets disposed of, with the following results (a) The classification of the goods cleared under Bill of Entry No. 6394 dated 6-8-2003 is affirmed under CTH 8525 20 92 and its confiscation under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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