Customs, Excise and Gold Tribunal - Mumbai
Jet Airways (I) Ltd. vs Commissioner Of Customs on 30 November, 2004
Equivalent citations: 2005(181)ELT103(TRI-MUMBAI)
ORDER S.S. Sekhon, Member (T)
1. Appellants are a scheduled airline. They imported certain item for use as replacement in their Aircrafts. The goods being urgent requirement were cleared on direct delivery basis on several BES filed during the period Jan 98 to March 98. The claim for clearance were made, as freely importable, in terms of para 5.34 of the Handbook of Procedures for the year 1997-2002 on duty as applicable vide Sr. No. 190 to notification 11/97-Cus. dated 1-3-97.
2. A notice dated 23-4-1998 was issued, asking the importers to show cause why the goods as per Annexure thereto should not be ordered to be confiscated under Section 111(d) of the Customs Act, 1962 & penalty not be imposed, the imported items were placed in three annexures as follows -
(A) Rs. 5,43,01,354 items like engines etc. Freely importable (B) Item like transreceivers which require W.P.C. licence issued by Department of Communication in the Ministry of Communications total CIF Rs. 1,40,10,180/-
(C) Radio altimeter & like which require specific import licence valued at Rs. 3,64,91,463/-
Commissioner dropped the proceedings, as regards goods valued at Rs. 5,43,01,354 in & Annexure (A) held that items in Annexure (B) & (C) valued at Rs. 1,40,10,180/- & Rs. 3,64,91,463/- were restricted. He found that para 5.34 of the Handbook of Procedures dealt with, only secondhand/repaired/recondition spares by specified airlines & import of new spares as per ITC (HS) classification was not permissible without a licence. Since licence from Ministry of Communications was not produced, for items under Heading 85 of Tariff. He held the goods at (B) & (C) respectively to confiscation under Section 111(d) & since they were not available and arrived at a finding.
It is well known that the provision of Exim policy have been considerably liberalised by the Government as per stated policy an Economic reforms. All the goods were imported for being fitted to the aircraft operated by the importer. In the absence of any evidence to the contrary it is reasonable to assume that these goods have been so used. These were not imported for sale for profit. It is also reasonable to assume that had the importer applied to Ministry of Communications they would have obtained the licence as they had been granted licence at the time of import of Aircrafts for which the imported goods were meant. Similarly the goods which required a specific licence were also to be fitted to the Aircraft imported against specific licence granted by the competent authorities. It is, therefore, reasonable to assume that the competent authorities would have granted the licence for the subject goods had the importer approached them. The violation is therefore technical in nature and not done by any mala fide intent. In view of the forgoing reasoning a lenient view would be in order. I therefore pass the following order.
He imposed a penalty of Rs. 25 lakhs under Section 112(d) of the Customs Act, 1962. Hence this appeal.
3. After hearing both sides & considering the material on record it is considered that ITC (HS) classification would have to be read harmoniously to determine the policy for import of the goods as classified therein. The provision of Para 5.34 of the Handbook would only persuade us on consideration of reduction fine & penalty in case violations of ITC (HS) Classification is established. The Commissioner has imposed a penalty of Rs. 25 lakhs which is considered to be excessive, since the imports are for use in Aircraft & the violation to be held to be technical by the Commissioner. We would, while confirming the liability of penalty reduce the same to Rs. one lakh only. That would meet the requirements of law & allow the appeal partially in above terms.