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TMI Blog2019 (5) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... e nearing their expiry period. It is also interesting to note that even when CFTRI in their initial report dt. 18.09.2010 had flagged the non-mention of batch number and non-mentioning the dates of manufacture and expiry of goods, while sending the samples for retest, the department again goofed up, this time by not mentioning the name of the manufacturer. This is definitely a tragedy for which the department will have to bear the cross, especially when there is no dispute that the appellant-importer had given all these details at the time of import. It can be concluded that the report dt. 15.07.2010 of University of Madras has to be taken as the correct report since only that report has discussed the actual nature and condition of the imported goods. Viewed in this light, impugned goods cannot be then assailed as not conforming to the Food Safety and Standards (Packaging and Labelling) Regulations, 2011. Valuation - enhancement of value based on NIDB data - HELD THAT:- The order of enhancement of value by the original authority in his order dt. 23.05.2012 based on NIDB data also cannot be sustained in view of the plethora of decisions by higher appellate forums includin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... searched the appellant s firm premises in Chennai. On 7.7.2010, the samples were forwarded to Centre for Advanced Studies in Botany, University of Madras, Guindy Campus, which in its report dated 15.7.2010 opined that the sample was Agar Agar with no pathogenic micro-organisms upon culture on different media. Nevertheless, on 16.8.2010 another representative sample was sent for re-test by the Central Food Laboratory, Mysore which, in turn, sent its opinion dated 13.9.2010 stating as under : ..the sample of agar agar does not confirm as Food Ingredient under the provisions of PFA Act 1954 the rules thereof, in that ‒ a) Batch no. not mentioned as required under rule 32 e; and b) Dates of manufacture expiry not mentioned as required under rule 32 (f) 32(i) respectively. A SCN dt. 01.10.2010 was issued to CMT and other noticeees inter alia proposing (a) to reject the price of ₹ 82.87-86.13/Kg CIF (USD 1.8-2.5/Kg CIF) declared in the live as well as past five consignments and to enhance to ₹ 432.67/Kg CIF; (b) to deny the benefit of notification No.21/2002-Cus (sl.no.28) 3/2006 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77/2012 dt. 22.3.2012, the Tribunal inter alia directed pre-deposit of ₹ 2 lakhs. The Tribunal also inter alia passed the order as under : The appellants plead that because of the delay in release of the goods, the goods are deteriorating and is likely to become unfit for human consumption shortly. They pray for quick relief in the matter. In view of this, we direct the adjudicating authority to pass orders on priority basis and decide the issue whether the goods in question are fit for human consumption preferably within a period of 15 days from today, and if found fit to release the goods on payment of redemption fine as originally decided by the adjudicating authority. This order is without prejudice to the rights of the appellant to contest the merits of such confiscation, in further proceedings. Pursuant to CESTAT order, retest was conducted and a report was issued on 19.04.2012. The Additional Commissioner of Customs on the basis of such retest conducted de novo adjudication with regard to the issue of enhancement of value of goods and also confiscation, and vide an OIO No.18829/2012 dt. 23.05.2012 held that declared values of the goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he entire issue when the appeal is pending before Hon ble Tribunal, I find that any discussion of refund of duty amount would be incorrect at this stage till the final outcome of the appeal before CESTAT. As regards, ₹ 3000/- it is directed that the LAA may verify the facts once again and if indeed the amount had not been spent towards the forwarding charges of the samples for test, the same may be refunded as per law. Hence appeal C/41002/2014 filed by appellant CMT. 8.1 When the matter came up for hearing, on behalf of appellants, Ld. Counsel Shri J. Shankarraman reiterated the grounds of appeal in respect of all the three appellants and also made oral and written submissions which can be summarised as under : 8.2 The valuation adopted by the Department is contrary to law and factually incorrect. The purchase price was ₹ 84.60/kg and after adding customs duty, port expenses, transport etc. the value would come to ₹ 160.70 and after adding a profit margin of ₹ 12% the sale price would be around ₹ 180. The same goods have been sole in the market around ₹ 200/- kg during the relevant period. Whereas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abelling) Regulation, 2011 for the reasons that since date of expiry declared in the label is dated 20.04.2012 the shelf life of the product is less than 60% and also that manufacturer s address is not given as required. Based only on these report, the Additional Commissioner of Customs proceeded to do de novo adjudication of the matter and vide order dt. 23.05.2012 held that goods expired on 20.04.2012, therefore they cannot be consumed and cannot be released, hence liable for confiscation under Section 111 (d) of the Customs Act, 1962. The adjudicating authority confiscated the consignment and gave option to pay a redemption fine of ₹ 25,000/- in lieu of confiscation, however only for the purpose of re-test. However, we find that the authority has gone beyond the scope of the direction given by CESTAT in the Stay Order dated 22.03.2012 and enhanced declared value of the goods, this time from ₹ 82.87 per kg to ₹ 437.71 per kg. and also imposed penalty of ₹ 10,000/- on the importer under Section 112 ibid. We are unable to fathom how such a full scale re-adjudication of the matter including the aspect of re-enhancement of declared value could have been taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spect of the live consignment, for a journey from import stage to orders by the Commissioner (Appeals) for goods which admittedly had a limited shelf life. This sad episode does not stop here. The Stay Order of CESTAT Chennai dated 22.03.2012 had categorically directed the adjudicating authority to decide the issue whether the goods are fit for human consumption preferably within a period of 15 days from today . However, the said authority took another 60 days to decide this aspect and further, choose to go beyond the scope of the directions of the Tribunal to re-adjudicate all the aspects of the import once again. In the first place, the department s lethargy, in particular, the 16 months delay discussed supra, has resulted in such a piquant situation that when the sample was sent for re-test, CFTRI Laboratory could only point out that the goods have less than 60% shelf life since they expired on 20.04.2012. To add insult to injury, the adjudicating authority in his unauthorised re-adjudication order dated 23.05.2012 blithely holds in para-36 thereof, that as the goods have already expired, they cannot be consumed and so decides that the goods cannot be released since they are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Del.) This being so, that portion the Commissioner (Appeals) Order upholding such enhancement of value from ₹ 82.87 per kg. to ₹ 437.71 per kg. based on NIDB data is therefore set aside. By implication, the goods cannot then be held liable to confiscation under Section 111 (m) of the Act on the charge of undervaluation. In the event, that part of the LAA upholding the order by the original authority of confiscation of impugned goods under Section 111 (m) ibid cannot be sustained and is therefore set aside. In consequence, the imposition of redemption fine of ₹ 25,000/-under Section 125 ibid is also set aside. C/41022/2014 is allowed on above terms with consequential benefits as per law. 10.8 The penalty of ₹ 10,000/- imposed on CMT under Section 112 (a) ibid on the charge of having rendered the goods liable to confiscation under Section 111 (d) and (m) ibid will also have no legs to stand upon and hence that part of the impugned order of LAA upholding such penalty is also set aside. 10.9 However, we do not interfere with the observation of the Commissioner (Appeals) in respect of the claim for refund of duty pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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