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TMI Blog2023 (2) TMI 492X X X X Extracts X X X X X X X X Extracts X X X X ..... ted liability company. It also says that the legal statute of the Kingdecor has not changed in the last three years. It has directly exported MT of Product Under Consideration (PUC) to India and MT through two different related traders namely Xianhe Company Limited and Zhejiang Xianhe New Material Sales Company Limited, China PR. The Kingdecor company has claimed the adjustments on account of the ocean freight, insurance, inland transportation, port and other related expenses, credit cost and bank charges. The net export price at ex-factory level for Kingdecor (Zhejiang) Co. Ltd. has been determined and is shown in the dumping margin table. It is quite clear that the anti-dumping duty recommended by the authority is 116 USD per MT so far as the producer Kingdecor (Zhejiang) Co. Ltd. from China in relation to the decor paper. This comes under the heading 48059100 and 48022090 - it has made quite clear that XH and KD series of paper type for different markets and different customers have been made by them. It is not being questioned that in notification dated 28.09.2021, there is a specific reference of Xianhe as a producer of decorative base paper, however, it had not been pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally as well as imports the raw material from companies in China. 2. The Petitioner, in the past, has imported the raw materials from Xianhe Company Limited (hereinafter referred to as Xianhe ) and Zhejiang Xianhe New Material Sales Company Limited (hereinafter referred to as Zhejiang ). The Petitioner since December, 2019 has been importing the raw material from Kingdecor (Zhejiang) Company Limited (hereinafter referred to as Kingdecor ) which is a joint venture company between Xianhe, and Schattdecor, a Chinese and a German Company respectively. The Kingdecor has two related companies Xianhe and Zhejiang in China. 2.1. The Kingdecor supplies the raw material in India through two agencies; M/s. Saraf Sales Corporation and Shah International. The petitioner imported the raw material from the Kingdecor through the agent M/s. Saraf Sales Corporation. The Respondent No. 3 carried a search operation on 11.05.2022 at the premise of the petitioner and inspected the stock of uncoated paper know as raw material at the factory premise and warehouse of the Petitioner. It detained the raw materials on the grounds of misdeclaration of producer s source and lower payment of anti-dumpin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner executing a bond of Rs.24,41,31,320/- under Section 110A of the Customs Act along with an undertaking to pay the penalty and interest, which may arise in the future and furnish a Bank Guarantee or a cash deposit of Rs. 11,00,00,000/- 2.5. The petitioner on 05.08.2022 intimated the respondent no. 3 of payment of Rs. 25,00,000/- made to the Commissioner of Customs, Pipavav towards anti-dumping duty on the ground of assurance for co-operation of ongoing investigation. The petitioner also replied on 08.08.2022 to the respondent no.2 in relation to the communication of 27.07.2022 and seizure memo of 18.06.2022. The request was made on the part of the petitioner that the anti-dumping duty of the seized raw materials amounted to Rs. 88,22,040/- and the petitioner be allowed to furnish a bank guarantee amounting to the said amount of anti-dumping duty and would furnish a bond along with undertaking and the raw materials be released. It is emphatically submitted by the petitioner that the documents are proving that the raw materials have been imported from Kingdecor. 2.6. The respondent no.3 was intimated on 31.08.2022 by the petitioner regarding the further payment of Rs.50,00,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of law and Notification No. Case No. AD(OI) - 33/2020 dated 28th September, 2021 and being carried out in stark contravention of Article 265 of Constitution of India; (e) And pass, such further order/orders for granting relief(s) as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case to meet the ends of justice. 3. The draft amendment was moved by the petitioner which was allowed and accordingly the amendment also has been carried out. 4. Affidavit-in-reply on behalf of the respondent no.2 is filed by the Deputy Commissioner at Customs House where he has not admitted any of the statement, submission or averments. According to him, no fundamental or legal right of the petitioner has been violated because of the action or inaction on the part of the respondent and hence, no interference would be necessary. 4.1. It is also submitted that M/s. Match Graphics Pvt. Ltd. - the petitioner, vide letter dated 20.06.2022, requested for provisional release of seized imported goods namely 'Uncoated Printing Paper' weighing 1882001 Kgs valued Rs.24,41,31,319/- which was imported through Pipavav Port seized by the DRI, Ahmedabad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing been assessed at Rs.24.41 crores (rounded off) imported through Pipavav Port under the jurisdiction of Customs Jamnagar Commissionerate, is to the tune of Rs. 6,87,77,186/-. The respondent vide its letter dated 27.07.2022 informed the Petitioner that the Principal Commissioner of Customs (Preventive), Jamnagar being the adjudicating authority had ordered the provisional release of seized goods imported through Pipavav under Section 110A of Customs Act, 1962 on his furnishing the bond of Rs. Rs.24.41 crores and also on deposit of an amount of Rs. 11,00,00,000/- cash or by way of a bank guarantee. Out of the Bank Guarantee of Rs. 11,00,00,000, Rs. 6,87,77,186/- is to cover the differential duty involved on the seized goods and the remaining amount is to secure the amount of fine that may be levied in lieu of confiscation under Section 125 of the Customs Act, in addition to the penalties that may be imposed at the stage of adjudication of the case. 4.4. It is also stated that there is an alternative remedy as against the order of Commissioner of Customs, an appeal would lie under the Customs Act under Section 129A of the Customs Act, 1962. Hence, the petitioner has approached t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adjudicating authority in terms of Section 110A of the Customs Act, whereby, the trite requirement of reasonableness is expected at any given point of time. The discretion of provisional release cannot be exercised in a mechanical manner so that it leads to miscarriage of justice. 5.3. It is further the say of the petitioner that show cause notice is not issued towards the seized goods under Section 124 of the Customs Act, within a period of six months from the date of seizure, further extension can be provided by the Principal Commissioner of Customs or Commissioner of Customs with the reasons to be recorded in writing for a maximum period of six months. The Respondents do not have a premium over the legislative intent to grant such an extension in a mechanical manner. The order of provisional release of goods also has not been passed by the adjudicating authority. 5.4. None of the adjudicating authorities, at Jamnagar or at Mundra have passed any order for the provisional release in the capacity of an adjudicating authority. There is no quantification nor any basis for any directions which have been communicated by a person other than the adjudicating authority. The provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is an indispensable part of a sound judicial system, the reasons at least sufficient to indicate an application of mind to the matter before Court. The affected party can know why the decision has gone against him. Therefore, one of the salutary requirements of natural justice is spelling out reasons for the order made, a speaking out. 5.9. The Apex Court also in case of Kranti Associates Private Limited Anr. vs. Masood Khan Ors. [(2010) 9 SCC 496], has held that the Administrative Bodies performing quasijudicial functions shall comply with the principles of natural justice, and hence, is obligated and is under duty to record reasons and pass a speaking order. The reasons introduces clarity in an order and therefore, it is emphasized that there shall have to be a reason and that is one of the fundamentals of good administration. 5.10. Moreover, it is contested that the raw material have code XH instead of KD and hence, it is doubted by the respondent no. 3 to be not produced by Kingdecor. It has been already stated that Kingdecor is a joint venture company between Xianhe and Schattdecor and Xianhe and Kingdecor are related companies. Moreover, the Kingdecor itself on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or exported from subject country, from the date of notification to be issued in this regard by the Central Government, equal to the amount mentioned in column 7 of the duty table appended in this order. The landed value of imports for this purpose also is permitted to be determined by Customs under Customs Act, 1962 and applicable level of the custom duties except duties levied under Section 3, 3A, 8B, 9, 9A Customs Tariff 1975. The duty table mentions thus:- S N Heading Description Country OF Origin Country OF Export Producer Amount Unit Currency 1 2 3 4 5 6 7 8 9 1. 48059100, 48022090 Decor Paper China PR China PR Kingdecor (Zhejiang) Co. Ltd. 116 MT US$ 2. 48059100, 48022090 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve any joint venture, however Kingdecor is a joint venture of Xianhe and Schattdecor AG. 7.2. The Kingdecor has a related entity in India namely Shah International dealing in subject goods produced by the company and after all these details, under the heading of export price, it is specified that Kingdecor has been exporting the MT of PUC to India and MT through two different related traders namely Xianhe Company Limited and Zhejiang Xianhe New Material Sales Company Limited. It is not in dispute that the duty has already been paid as per 116 metric ton as the claim of the petitioner is that it had been on a regular basis getting the consignment from the Kingdecor company of the decor paper. The doubt has been created because of the two different series of XH and KD . 8. Considering the brief note on the status of investigation in case against M/s. Match Graphics Pvt. Ltd. - present petitioner, we can gather that the reference has been forwarded to the overseas inquiries on 14.10.2022 along with the brief facts of the case and details required from China. 8.1. It appears that no response has been received so far and therefore, the reminder letter for expediting the repo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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