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TMI Blog2017 (4) TMI 480X X X X Extracts X X X X X X X X Extracts X X X X ..... r want of licence - the confiscation held u/s 111 (d) of the CA is not correct and legal. Since the goods were not liable for confiscation u/s 111 (d) the redemption fine and penalty imposed by the adjudicating authority is on very higher side, which is required to be reduced - The redemption fine reduced from ₹ 30 lakhs to ₹ 15 lakhs - Penalty is reduced from ₹ 5 lakhs to ₹ 2 lakhs. Appeal allowed - decided partly in favor of appellant. - C/916/08-Mum - A/86451/17/SMB - Dated:- 20-3-2017 - Mr. Ramesh Nair, Member ( Judicial ) Shri. Jitu Motwani, Advocate for appellant Shri. M. K. Sarangi, Jt. Comm. (AR) for respondent ORDER Per Ramesh Nair 1. The facts of the case is that a Bill of Entry No.1023/130 dated 30/04/1990 was filed by the appellant, M/s.Hotel Leela Venture Ltd. for 168 units declared as Diakin Air Heat Pumps for space heating and space cooling applications. They declared CIF value of the goods was ₹ 61,48,796/-. According to the importer, since the goods were Air Heat Pumps they claimed assessment under heading 8418.69 of the Customs Tariff read with Notification No.30/88 as amended. On examination of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion as per the invoice is Heat Pump FTY 60 AVI / RY60 AVI (RY6OBVI was corrected to RY60AVI in the invoice) 8 units. On detailed examination, the goods covered by this item No. are found to be 8 units of FTY 60 AVI. This is an indoor unit wall mounted type, which comprises of a motor driven fan, refrigerator unit evaporator, an auxiliary heating coil, electronic circuitry for controls, a wired remote controller and end fitting to be connected to the outdoor unit. The Unit also has a water pump to drain the condensed water collected in the refrigerating unit evaporator chamber. The wired remote controller has got inter alia mode selector which can select program Dry, Cool, Automatic and heat mode. 8 units of RY 60 AVI. This is an outdoor unit which comprises of a motor driven fan, a condenser coil, scroll compressor, 4 way valve, electronic circuitry and end fitting to be connected to the indoor unit. These units are similar to the outdoor units covered by the units invoiced at Item No. 2 of invoice. On detailed examination of the consignment, 168 pieces of flexible insulated pipes of copper of 10 mtrs length, each with end fitting were also found. These are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of licence as well as for mis-declaration with an option to redeem the same on payment of fine of ₹ 30 lakhs. A penalty of ₹ 5 lakhs was also imposed on the appellants. 3. Heard both sides. 4. Since the matter relates to classification and the order-in-original is primarily based on the HSN Explanatory Notes it will he useful to reproduce the relevant entries the HSN Explanatory Notes which read as under :- 84.15 - AIR-CONDITIONING MACHINES, COMPRISING A MOTOR-DRIVEN FAN AND ELEMENTS FOR CHANGING THE TEMPERATURE AND HUMIDITY, INCLUDING THOSE MACHINES IN WHICH THE HUMIDITY CANNOT BE SEPARATELY REGULATED(+) Not incorporating a refrigerating unit 415.10 Window or wall types, self-contained 8415.20 Of a kind used for persons, in motor vehicles - Other: 8415.81 Incorporating a refrigerating unit and a valve for reversal of the cooling/heat cycle 8415.82 Other, incorporating a refrigerating unit 8415.83 8415.90 Parts The heading applies Only to machines : (1) Equipped with a motor-driven fan or blower, and (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blower. Also included are units for heating/cooling a closed chamber (lorry, trailer or container), consisting of a compressor, a condenser and a motor in a housing mounted on the outside of the goods compartment and of a ventilator and an evaporator within the container. 84.18 - REFRIGERATORS, FREEZERS AND OTHER REFRIGERATING OR FREEZING EQUIPMENT, ELECTRIC OR OTHER; HEAT PUMPS OTHER THAN AIRCONDITIONING MACHINES OF HEADING NO. 84.15. 8418.61 - Compression type units whose condensers are heat exchangers 8418.69 Other Parts 8418.91 - Furniture designed to receive refrigerating or freezing equipment 8418.99 - Other A heat pump is a device which draws heat from a suitable heat source (principally underground or surface water, the soil or the air) and converts it with the assistance of a supplementary energy source (e.g., gas or electricity) into a source of more intense heat. A heat transfer fluid is generally used to transfer the heat from the source to the heat pump and from the heat pump to the medium to be treated. There are two types of heat pumps the compression type and the absorption type. Compression heat pumps consist essentially ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... djudication order darted 31/03/2008 which is the order impugned in the present appeal. In this order, the learned Commissioner confiscated the goods under Section 111 (d) and imposed the same amount of redemption fine of ₹ 30 lakhs and imposed a penalty of ₹ 5 lakhs under Section 112 (a) of the Customs Act. Therefore, the appellants are before me. 2. Shri Jitu Motwani, learned Counsel for the appellant submits that after the Tribunal order which was upheld by the Hon ble Supreme Court, the only issue to be decided by the Commissioner was whether the goods were liable for confiscation under Section 111 (d) of the Customs Act, 1962. However, the confiscation of the goods under Section 111 (m) was upheld by the Tribunal. He submits that in earlier order , the redemption fine and penalties were imposed, considering the confiscation under Section 111 (d) as well as Section 111 (m). In the present case, the adjudicating authority confiscated the goods under Section 111 (d) also on the ground that the licence issued by the licensing authority was after the import of the goods and at the time of import, the licence was not existing. Therefore, there was a contravention of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to raise any objection. If it is permissible to issue a licence at a later date after the import of the goods, the custom authorities cannot take any action holding that the goods are prohibited for want of licence. In case of licence issued after the import the goods cannot be confiscated as is held in the judgements relied upon by the Counsel in the case of Bhilwara Spinners Ltd. (supra) and Rama News Prints and Paper Ltd. (supra). I also observe that if had the Tribunal of a view that even though the licence was issued but later the import clearance of the goods, are liable for confiscation, there was no need to remand the matter to the Commissioner for reconsideration. The learned Commissioner was only required to see whether the goods were covered under the licence which was issued after the clearance of the goods. Therefore, the confiscation held under Section 111 (d) of the Customs Act is not correct and legal. I therefore, set aside the confiscation of the goods held by the lower authorities under Section 111 (d). As per the Tribunal's order, the confiscation under Section 111 (m) attained finality. However, since the goods were not liable for confiscation under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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