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TMI Blog2018 (5) TMI 1307X X X X Extracts X X X X X X X X Extracts X X X X ..... on, clearance into the domestic market on payment of redemption fine would run counter to the objectives of the Foreign Trade Policy in prescribing such registration as a pre-requisite for import. The quality of the goods and safety to the consumer is assured only with such registration - confiscation of SAMSUNG sets is valid. Valuation - Held that: - In the absence of any evidence of contemporaneous imports to support the enhancement, and the failure to taken into consideration factors that may had the effect of abating the value at which imports were made by M/s Sony India Ltd, we are unable to assent to the finding of misdeclaration. Consequently, the confiscation of SONY television sets under section 111(m) of Customs Act, 1962 for misdeclaration of value is not correct in law - As the SAMSUNG television sets are required to be re-exported without being cleared on payment of duty, valuation is not relevant. The Rules exist to detect and destroy counterfeits. Counterfeits can be detected only though the prescribed procedure. That does not appear to have occurred and, hence, the goods are not counterfeits. Section 11 and, consequently section 111, is not liable to be invoke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty of ₹ 20,00,000/- was imposed on Shri Gurvinder Singh Kochhar, Manager and authorised signatory of M/s Raj Traders as well as power of attorney holder of M/s Ideal Impex. 2. Elaborating upon the contents of the impugned order, Learned Counsel for appellant contends that SONY television sets were not in violation of compulsory registration scheme of the Bureau of India Standards as the exports was already registered for supply to their Indian entity. Admitting that M/s Samsung was not similarly registered, it was submitted that said goods were being manufactured in India and sold to the customers thus obviating the need for registration. 3. Learned Counsel also explained that the order-in-original fails the test of legality as the sequential application of the rules of valuation commencing with ascertainment of value of contemporaneous imports had not been resorted to. It was further argued that the value adopted could not be justified as time, or volume, of goods imported by M/s Sony India was not placed on record while adopting their FOB price of import for assessment. It is also contended that the confiscation, and conditional redemption thereof, was patently in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s Sony India Ltd, and the registration for import by M/s Sony India Ltd being approved, compliance with the registration scheme is beyond question. The confiscation of SONY television sets under section 111(d) is not tenable and the direction of re-export is even less so. Insofar as SAMSUNG sets are concerned, there is no evidence of registration which warrants confiscation under section 111(d) as a natural consequence and, in view of the lack of registration, clearance into the domestic market on payment of redemption fine would run counter to the objectives of the Foreign Trade Policy in prescribing such registration as a pre-requisite for import. The quality of the goods and safety to the consumer is assured only with such registration. Accordingly, confiscation of SAMSUNG sets is valid and the condition of re-export for redemption cannot be faulted. 7. Turning to the issue of valuation, it is clear that the original authority having relied upon the prices furnished by M/s Sony India Ltd to reject the declared value, there can be no quarrel on the legality of this approach. Nevertheless, it is required of the adjudicating authority, in accordance with the Customs Valuation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... those rules such jurisdiction as may lie within the civil dispute resolution mechanism cannot be claimed. A plain reading of the said Rules would make this amply clear; the extent of enforcement at the border or gateway is limited to the commitment in the convention to prevent entry of goods that falsely claim a provenance from the intellectual property right owner without having paid the compensation. To that end, goods that lack a connection with intellectual property right owners are prohibited for import under section 11 of Customs Act, 1962. 10. To prevent imports that have not paid price of access to the intellectual property, a compliance regime has been put in place under the said Rules under the power vested in the Central Government by section 11 of Customs Act, 1962. For such property registered under foreign law, the enforcement is afforded through a local right holder who will be placed on notice on arrival of any goods that claims a nexus with the intellectual property. Upon such notice, the right holder may choose to invoke the right to ascertain detriment to the owner of the intellectual property right with consequence of confiscation if the importer was in posse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of the other three violations, unless the offences have already been established by a judicial pronouncement in India and the Customs is called upon or required to merely implement such order. In other words, extreme caution needs to be exercised at the time of determination of infringement of these three intellectual property rights. xxxxx 7. The surety and security shall be on consignment basis and shall be furnished along with the bond (Annexure B) consequent upon interdiction of the consignment allegedly infringing rights of the right holder. Keeping in view the value of the goods and other incidental expenses, it has been decided that the bond amount shall be equal to 110% of the value of goods. However, the amount of security to be furnished along with the bond shall be 25% of the bond value. The right holder may furnish security in the form of bank guarantee or fixed deposit. However, if the right holder fails to execute the consignment specific bond and to furnish security within three days from the date of interdiction of the goods, the same must be released forthwith. xxxxx 13. It may be noted that though the notice/application for registration ..... X X X X Extracts X X X X X X X X Extracts X X X X
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