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TMI Blog2021 (10) TMI 719X X X X Extracts X X X X X X X X Extracts X X X X ..... l year) quota of 1.5 lakh MT as per procedure notified by DGFT and it will be subject to Minimum Import Price (MIP) of Rs. 200/- and above CIF per kilogram and import is allowed through Kolkata Sea Port only. This restriction shall not apply to Government's import commitments under any Bilateral or Regional Agreement or Memorandum of Understanding. 2. The appellant / importer had obtained stay order against the above Notification / Trade Notices issued by DGFT from the Hon'ble High Court of Andhra Pradesh. However, the Hon'ble Supreme Court in Transfer Petition (Civil) No. 496 to 509/2020 dated 26.8.2020 upheld the validity of Notification and the Trade Notice imposing restriction of import of peas. 3. It appeared to the department that the appellant has violated the provisions of Foreign Trade Policy 2015 - 2020 and thereby goods under import are liable for confiscation under the provisions of Customs Act, 1962. The goods lying in Visakha Container Terminal CFS and Sravan CFS, Visakhapatnam were restrained under section 110 of the Customs Act, 1962. The appellant waived issuance of Show Cause Notice. After granting personal hearing the matter was adjudicated. The origin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Udit Malik, Advocate appeared and argued on behalf of the appellant. The learned Senior Counsel opened his arguments by adverting to the prayer in the appeal at page 19 of the appeal paper book. He asserted that the reliefs claimed in the appeal is to allow the appellant to redeem the goods only for the purpose of re-export; to grant demurrage waiver certificate; and to set aside the penalty of Rs. One crore. 7. The arguments put forward by the counsel was mainly requesting to allow the appellant to redeem the goods for the purpose of reexport. The appellant had imported the goods during the period when the Notification dated 29.3.2019 was stayed by the Hon'ble Andhra Pradesh High Court. Later, the validity of the Notification / Trade Notice was upheld by the Hon'ble Supreme Court in the case of Union of India Vs. Agricas LLP - 2020 (373) ELT 752 (SC). 8. Pursuant to this decision of the Hon'ble Supreme Court, other importers (M/s. Raj Grow Impex LLP & M/s. Harihar Collections) whose imported goods covered by these notifications were not yet released requested for adjudication waiving the Show Cause Notice. The adjudicating authority though ordered confiscation e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriod of two weeks from today, such a prayer for re-export may be granted by the authorities after recovery of the necessary redemption fine and subject to the importer discharging other statutory obligations. If no such option is exercised within two weeks from today, the goods shall stand confiscated absolutely. 98. The matters relating to the interveners shall also be governed by the findings of this judgment and appropriate orders in their regard shall be passed by the authorities/Courts, wherever their matters relating to the subject goods are pending but, their options of further appeal, only in relation to the quantum of amount payable, including that of penalty, is left open. 99. The respondent-importers shall pay costs of this litigation to the appellants, quantified at Rs. 2,00,000/- (Rupees two lakhs) each. 100. All pending applications stand disposed of." (Emphasis supplied) On coming to know the decision passed by Hon'ble Supreme Court in the case of Raj Grow Impex LLP (supra), the appellant requested for permission to redeem the goods for the purpose of re-export only. However, this request was denied stating that the direction in the judgment of the Hon&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon'ble Supreme Court against the stay being granted to the abovementioned notification by various High Courts in India. The Hon'ble Supreme Court vide judgment dated 26.8.2020 upheld the validity of the above mentioned notifications, inter alia, stating that the imports, if any, made relying on the interim orders would be held contrary to the Notification and Trade Notices issued under FTDR Act and would be so dealt under the provisions of Customs Act, 1962. (x) The Customs Department issued notices dated 27.8.2020, 3.9.2020, 8.9.2020 and 15.9.2020 under section 110 of the Customs Act, 1962 for confiscation of the goods imported by the appellant. (xi) On 24.9.2020, Writ Petition (Civil) No. 1662/2020 filed by the appellant was disposed by the Hon'ble High Court of Andhra Pradesh consequent to the judgment of the Hon'ble Supreme Court whereby the Hon'ble High Court granted liberty to the appellant to avail appropriate remedy under law. (xii) The goods being perishable in nature, the appellant vide letter dated 2.11.2020 sought for adjudication after personal hearing and waived issuance of Show Cause Notice. That vide email dated 4.11.2020, the appellant was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ven by the Hon'ble Supreme Court in the case of Raj Grow Impex, submitted a letter to the customs authorities seeking permission to re-export the green peas imported by them. (xxii) The customs authorities at Visakhapatnam vide letter dated 25.6.2021 rejected the request of the appellant stating that the direction is applicable only to parties therein and that the goods stands absolutely confiscated vide order dated 2.3.2021. 11. It is submitted by learned counsel that the said direction, though is binding to the parties in the appeal before the Hon'ble Supreme Court, being a judgment in rem, the directions has to be applied in similar situations of import of peas. He submitted that the Hon'ble Supreme Court having granted permission to the parties in the above captioned appeal to re-export the impugned goods, the very same relief ought to be extended to the appellant also. No fruitful purpose would be served with the absolute confiscation of the said goods and it would only result in grave economic loss to the appellant. On 18.6.2021 and 06.07.2021, the appellant approached the Commissioner of Customs, Vishakapatnam Port seeking permission to re-export the peas lying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In regard to penalty, the learned counsel requested that a lenient view may be taken as the notification itself was under litigation. Further now the appellant only intends to re-export the goods. 14. The learned counsel submitted that in similar case of import of Peas, the Commissioner (Appeals), Chennai vide Order in Appeal F. No. C3/11/172/O/2021/SEA dated 30.6.2021 allowed re-export of the goods. The Commissioner (Appeals) had referred to the direction of Hon'ble Supreme Court in para 97 (f) in the case of Raj Grow Impex LLP (supra). He argued that the department cannot discriminate the litigants by taking different views on identical set of facts, law and situation. 15. The learned Senior Counsel put forward arguments for issuance of demurrage free certificate to the appellant. He referred to subsection (2) of Section 141 r/w Section 157 of Customs Act, 1962 as well as Handling of Cargo in Customs Area (Amendment) Regulation, 2019. That demurrage charges can be waived as per these Regulations. Regulation 6(l) of the Handling of Cargo in Customs Area Regulation reads as under:- "Subject to any other law for the time being in force, shall not charge any rent or d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Chapter 07131000 which is restricted item in terms of Notification No. 37/2015 - 2020 dated 18.12.2019 issued by DGFT. The Notification imposes the following conditions namely:- (i) Quota of 1.5 lakhs MT (ii) Minimum Import Price (MIP) of Rs. 200/- per kg (CIF) (iii) Port of import if Kolkata 20. When there are restrictions imposed, it is necessary to obtain a license / authorization from DGFT and consequently the additional condition of "actual user" is also attracted. The appellant has imported Green Peas through Visakha Container Terminal CFS and M/s. Sravan Shipping and Services CFS under 21 bills of lading and filed 9 bills of entry. They claimed to have imported the consignment pursuant to the interim stay granted by the Hon'ble High Court of Andhra Pradesh vide order dated 16.3.2020 in W.P. (C) No. 1662 of 2020. 21. Consequent to the interim stay granted by various High Courts, the Government filed Transfer Petition (Civil) before the Hon'ble Supreme Court to hear all the matters together so as to give quietus to the matter. The Hon'ble Supreme Court in Transfer Petition (Civil) No. 496 to 509 of 2020 dated 26.8.2020 as reported in 2020 (8) TMI 705 - Supre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese importers. However, citing the earlier judgment dated 18.3.2021, the Hon'ble Supreme Court allowed the importers therein to exercise the option of re-export on payment of redemption fine and discharging other statutory obligations within two weeks from 17.6.2021. This option is given to the importers therein only in view of the special circumstances existing therein. This option is in personam. 24. The Hon'ble Supreme Court has categorically held in the above two judgments (18.3.2021 and 17.6.2021) that the goods imported violating the Notifications and the Trade Notices become prohibited goods and thereby liable for absolute confiscation. The order of the Hon'ble Supreme Court permitting re-export is applicable only to the litigants therein. The appellant vide letter dated 19.9.2021 sought release of the goods on payment of fine / penalty. They then had taken a stand that re-export is not contemplated in law. During the personal hearing also the appellants only sought for release of the goods on payment of fine / penalty for home consumption and did not put forward claim for re-export. Even before the Commissioner (Appeals) the appellant has not put forward the pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder dated 30.6.2021 in Appeal F. No. C3/2/172/O/2021 passed by the Commissioner of Customs (Appeals) Chennai, wherein Commissioner (Appeals) allowed re-export of goods, it is submitted by the learned AR that the department is intending to file appeal before CESTAT, Chennai. The same cannot be treated as the stand of the department. He prayed that the appeal may be dismissed. 30. Heard both sides. 31. The main relief prayed in the appeal is a permission to re-export the subject goods. The appellant has relied upon sub clause (f) of Para 97 of the judgment of the Hon'ble Supreme Court in the case of Raj Grow Impex LLP (supra). The said para has already been noticed above. The learned AR appearing for the Department contends that though the principle laid in the judgment is applicable in rem, the said direction is in personam and therefore applicable only to the parties to the litigation. 32. The said judgment arises out of an appeal filed by the department (UOI). In para 8.1 of the judgment, it is seen stated that apart from the two importers, who had filed writ petitions before the Hon'ble High Court and directly related to the order impugned, two more importers have mov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein and that it is an order in personam. We have to say that the dispute that was pending before the Hon'ble Supreme Court between Government of India and the importers had no personal or individual element in it or nothing personal or peculiar to each importer. The challenge was with the validity of the Notification as well as the Trade Notices issued by DGFT which was on identical grounds common to all the importers. No doubt the judgment of Hon'ble Supreme Court upholding the validity of the notification is a judgment in rem. The learned AR has been at pains to argue that the part of judgment which pertains to upholding the validity of the Notification is a judgment in rem and the operative part of the order of the Hon'ble Supreme Court in respect of re-export is a judgment in personam only. True it may be, to say that the direction of the Hon'ble Supreme Court in the said judgment in respect of the option to re-export is binding on the parties of the said litigation. However, on similar set of facts and identical issue, the law laid down by the Hon'ble Supreme Court squarely applies and the directions given by the Hon'ble Supreme Court in resolving the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned goods. Being an agricultural product, the same is prone to decay due to insecticides, fungus and natural fury. I find that the impugned goods were imported during November - January 2020. Vide the impugned order of the LAA, the department had confiscated the goods, but had not allowed redemption as the LAA had held that the same is not obligatory. Considering the nature of the impugned goods which are prone to natural vagaries and shelf life restrictions, I am inclined to allow re-export in view of the present circumstances and in line with the order of the Hon'ble Supreme Court in Civil Appeal No:2217-2218 of 2021 dated 17.06.2021, under Section 125 of the Customs Act, 1962. xxxx xxxxx xxxx xxxx Accordingly, I modify the impugned order of the LAA and order as follows : (i) I order for re-export of the impugned goods within a period of 90 days on payment of Redemption Fine of Rs. 10,00,000/- under Section 125 of the Customs Act, 1962 by the appellant. (ii) I impose penalty of Rs. 5,00,000/- on M/s.Om Trading Company under Section 112(a)(i) of Customs Act 1962. (iii) The request of the appellant for waiver of detention/demurrage/warehousing charges to be considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsumption. After this judgment of the Hon'ble Supreme Court, the appellant has come up with the plea to allow them to redeem the goods for the purpose of re-export only. They were awaiting the outcome of the decision in Raj Grow Impex LLP case. 38. On 6.7.2021, they have given a further request for permission to re-export the cargo. On 25.6.2021, the department has replied to the appellant which reads as under:- "F.No.GEN/LGL/HC/PA/201/2020-Legal Date: 25/28.06.2021 To, M/s. Oscar Commodities Pvt. Ltd., H.No.64-16-3A, Balayogi Street, Pratap Nagar, Kakinada, E.G.District, Andhra Pradesh - 533 004. Sir, Sub : Improper import of Green Peas - Request for permission for export - reg. *** Please refer to your letter dated 18.06.2021 on the subject matter. Also please refer to the Hon'ble Supreme Court Judgement dated 17.06.2021 in Civil Appeal Nos.2217-2218. 2. It is submitted that the Hon'ble Supreme Court judgement is specific to only the respondents and the Interveners who filed the impleadment applications in the subject Civil Appeals. The Hon'ble Supreme Court Judgement is not applicable for M/s.Oscar Commodities Pvt. Ltd. In view of the above, the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upreme Court in the case of Raj Grow Impex LLP case, after considering all aspects has granted permission to the importer to re-export. The very same relief cannot be denied to the appellants without cogent reasons. A party who has not been able to cross the miles should not be discriminated only for the reason that they did not join in the litigation. The directions are intended to resolve the dispute for importers who are similarly placed. We therefore are of the considered opinion that the appellants have to be granted permission to re-export the goods. We hold that the order of the Commissioner (Appeals) requires modification to this extent. 42. The next question that would then arise for consideration is what could be the redemption fine levied for redeeming the goods for the purpose of re-export. The adjudicating authority vide Order in Original No. 8/2020 dated 20.11.2020 had given an option to redeem the goods on payment of redemption fine of Rs. Two crores. The discussions of the adjudicating authority in this regard are as under:- "5. Now regarding the quantum of redemption fine, the act itself envisages that the redemption fine should not exceed the market value of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, applying 10% of the value works out to be Rs. 2 crore. This amount serves the dual purpose of negating the profit quantum of Rs. 1.3 crores as discussed supra and also acts as a deterrent to prevent such subsequent violations. Hence I find that 10% of the value of the goods is the appropriate redemption fine." 43. The appellant has not filed any appeal against such order of levy of redemption fine. This order has attained finality as against the appellant with regard to levy of redemption fine. 44. The learned counsel has prayed to take a lenient view in regard to the penalty imposed. In the previous paragraph, we have already stated that the appellant has not challenged the order passed by the adjudicating authority imposing penalty of Rs. One crore. We do not find any grounds to disturb the said penalty as the same has attained finality. 45. The appellant seeks direction for issuance of demurrage waiver certificate. He referred to Regulation 6(l) of the Handling of Cargo in Customs Area Regulation 2009. The said Regulation reads as under:- "6. Responsibilities of Customs Cargo Service provider: (1) The Customs Cargo Service provider shall - (a) keep a record of imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner or Assistant Commissioner of Customs; (l) subject to any other law for the time being in force, shall not charge any rent or demurrage on the goods seized or detained or confiscated by the Superintendent of Customs or Appraiser or Inspector of Customs or Preventive officer or examining officer, as the case may be; (m) dispose off in the manner specified and within a time limit of ninety days, the imported or export goods lying unclaimed, uncleared or abandoned: Provided that the period of ninety days may be extended by the Commissioner of Customs by such further period as may be allowed, on sufficient cause being shown for delay in the disposal; (n) not make any alteration in the entry or exit points or boundary wall without the permission of the Commissioner of Customs; (o) shall bear the cost of the customs officers posted by the Commissioner of Customs on cost recovery basis and shall make payments at such rates and in the manner specified by the Government of India in the Ministry of Finance unless specifically exempted by an order of the said Ministry; (p) shall observe the Central Government holidays as followed by the jurisdictional Customs formations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er filing the writ petition and obtaining a stay from the jurisdictional High Court. The Hon'ble Supreme Court in para 47 of the judgment in the case of Agricas LLP (supra) held that when importers have taken such chance there cannot be any bonafide belief on their part. The appellant was fully aware that they may have to face a dispute in regard to the notification. Ultimately, the appellant has not been able to justify the import, the Notification having been upheld by the Hon'ble Supreme Court. The goods were detained due to violation on his part. The decisions relied by the learned counsel on this issue are not applicable to the facts of this case. In the present case, the Hon'ble Supreme Court has categorically held that there cannot be any bonafide belief when the importers have taken their chance to import the goods. In such circumstances, we do find that the appellant stands any favourable chance for issue of a certificate of waiver of demurrage charges. This issue is found against the appellant. 47. In the result, the appeal is partly allowed. The impugned order passed by the Commissioner (Appeals) is modified to the limited extent of allowing the appellants t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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