Custom, Excise & Service Tax Tribunal
Commissioner Of Customs(Port), ... vs M/S.Himja Impex on 5 September, 2012
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL, KOLKATA
EASTERN ZONAL BENCH: KOLKATA
Stay Petition Nos.SP-233, 236 & 240/10
&
Appeal Nos.75, 78 & 82/10
(Arising out of Order-in-Appeal No.KOL/CUS/CKP/682 TO 691/09 dated 30.12.2009 passed by the Commissioner of Customs(Appeals), Kolkata.)
FOR APPROVAL AND SIGNATURE
HONBLE SHRI S.K. GAULE, MEMBER(TECHNICAL)
HONBLE DR. D.M. MISRA, MEMBER(JUDICIAL)
1. Whether Press Reporters may be allowed to see
the Order for publication as per Rule 27 of the CESTAT
(Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the
CESTAT(Procedure) Rules, 1982 for publication in any
Authorative report or not?
3. Whether Their Lordship wishes to see the fair copy
of the Order?
4. Whether Order is to be circulated to the Departmental
Authorities?
Commissioner of Customs(Port), Kolkata
Applicant (s)/Appellant (s)
Vs.
M/s.Himja Impex
M/s.Bahuchar Impex
-do-
Respondent (s)
Appearance:
Shri Sibatosh Chakraborty, Advocate for the Revenue Shri N.K.Chowdhury, Advocate & Shri Arijit Chakraborty, Advocate for the Respondent (s) CORAM:
Honble Shri S.K. Gaule, Member(Technical) Honble Dr. D.M. Misra, Member(Judicial) Date of Hearing :- 05.09.2012 Date of Pronouncement :-
ORDER NO.
Per Shri S.K. Gaule.
1. Heard both sides.
2. Revenue is in appeal against Order-in-Appeal No.KOL/CUS/CKP/682 TO 691/09 dated 30.12.2009 whereby ld.Commissioner(Appeals) has rejected the review application filed by the department.
3. Briefly stated facts of the case are that the respondents filed various bills of entry for clearance of consignment of old and used worn clothing declaring the value at US $ 0.45 per Kg.. The department enhanced the value to US $ 0.60 per Kg. to which the respondents agreed. The lower adjudicating authority adjudicated the cases on the count of discrepancies in weight, contravention of import policy and on valuation. Lower adjudicating authority ordered for enhancement of value to US $ 0.60 per Kg., confiscated the goods, however redeemed the goods on fine and imposed penalty. The orders passed by lower adjudicating authority were reviewed by Commissioner of Customs(Port), Customs House, Kolkata. Consequently appeal was filed before ld.Commissioner. Ld.Commissioner(Appeals) vide his impugned order rejected the appeal as time barred. Aggrieved by the same Revenue filed the instant appeal. Thereby respondents filed a miscellaneous application before this Tribunal for early hearing. The same were dismissed on the ground that both the authorities below held in favour of the respondent and there is no stay of the impugned order. Aggrieved by the same the respondent filed a Writ Petition before Honble High Court of Calcutta. The Honble High Court vide their order dated 11.04.2012 directed this Tribunal to dispose of the appeal. Accordingly the appeals are taken up for disposal.
4.1 Ld.A.R. appearing for the Revenue submitted that in all these cases the respective importers/respondents had filed bills of entry in for import of goods declared as old and used worn clothing. Such goods were being regularly imported by various importers through the port of Kolkata for the past many years. As per the previous norms and practices which were being followed by the Kolkata Custom House and other Custom Houses in respect of such import goods, valuation of the impugned goods was fixed as per the guidelines of the Directorate of Valuation. Also as such import goods were declared as old and used, therefore as per the existing provisions of the Export & Import Policy/Foreign Trade Policy/ITC (HS) Classification of Export & Import. A licence was required for import of such goods. The importers could not produce any such licence covering the import goods.
4.2 Ld.A.R. also submitted that after these above adjudication orders were formally issued, the same were reviewed by the Commissioner of Customs(Port). Around that time on re-examination of the respective import goods, by the DRI, misdeclarations on large scale on account of descriptions, quantity, value etc. were detected and reported to the Custom House on the basis of which the quantum of extra duty, fine penalty etc. in these cases would be many times more. Accordingly as per the order-in-review in all these cases, appeals were filed before the Ld.Commissioner(Appeals) intimating the new evidences which had emerged in these cases and praying for setting aside the impugned Orders-in-Original so that fresh show cause notices could be issued in these respective cases as per new evidences to safeguard government revenue. However, the ld.Commissioner(Appeals) in all these cases had dismissed the review applications filed by the Department without discussing the merits of these cases only on the ground that the review proceedings are time barred. Ld.A.R. also submitted that even if assuming but not admitting that the review proceedings in all these three cases are time barred as per the argument of the Ld.Commissioner(Appeals) that the same would be counted from the date of passing of the operative portion of the order of the adjudicating authority in file, the Department is covered by the judgement passed by Honble Tribunal (Larger Bench) in the case of Commissioner of C.Ex., Raipur vs. Monnet Ispat & Energy Ltd. as reported in 2010 (257) ELT 239 (Tri.-LB).
4.3 Ld.A.R. submitted that this Tribunal recently vide order dated 28.06.2012 has remanded an Appeal filed by the Department on similar issue of import of old and used worn clothing in that case also departments appeal was dismissed by Ld.Commissioner(Appeals) as time barred. In this case also, Ld.Commissioner(Appeals) has not decided these cases on merit the same should be remanded following the earlier order passed by this Tribunal dated 28.06.2012. The contention is that Ld.Commissioner(Appeals) on previous occasions in similar circumstances and on the similar issues had allowed the Departments review applications for setting aside the Order-in-Original passed by lower adjudicating authority on the basis of re-examination reports of DRI, KZU in respect of twenty-nine cases vide Order-in-Appeal No.KOL/CUS/CKP/479-507/2009 dated 28.07.2009 after discussing the merits of these cases so that fresh SCNs could be issued by the DRI.
4.4 Ld.A.R. drew our attention to the findings of the ld.Commissioner(Appeals) in para 13 of the impugned Order-in-Appeal dated 30.12.2009 wherein it has been recorded that respective importers in these cases have already paid the extra duty, fine, penalty etc. as per the orders of the adjudicating authority and contended that this is apparently not correct as is clear at Para 17 (m) in the grounds of Appeal that in case of only one B/E the respondent has paid the duty and during the hearing of these cases the respondent could not submit any documents contradicting the Departments submissions that the case of remaining 9BS/E duty was not paid. Therefore on this ground also the Order-in-Appeal is liable to be set aside as the same is not based on correct facts of these cases. Ld. A.R. also relied upon the following decisions.
i) Raman Enterprises v. CC, Mumbai 2003 (158) ELT 694 (Tri.-Del.)
ii) Unitop Office Automation vs. CC, Delhi-2001(135)ELT 1368 (Tri.Del.)
iii) CC v. Candid Enterprises 2001(130) ELT 404 (SC)
iv) UOI v. R.C.Fabrics(P) Ltd.-2002 (139) ELT 12 (SC)
v) UOI v. Jain Shudh Vanaspati Ltd.-1996(86)460 (SC)
vi) Suzlon Infrastructure Ltd. v. UOI 2009 (243) ELT 497 (Bom.)
vii) CCE, Raipur v. Monnet Ispat & Energy Ltd.-2010(257)ELT 239(Tri.LB) 5.1 The contention of the respondent is that the review application against purported order subsequently issued upon order of assessment does not lie. The purported orders dated 03.08.2009 and 28.07.2009 respectively were never in existence at the time of passing of the order of assessment by the earlier adjudicating authority who had adjudged the cases. Review applications before Ld.Commissioner(Appeals) are time barred. The goods were assessed under the bills of entry after enhancing the value from US$ 45 to US$ 0.60 and duty was paid. Order of assessment dated 15.07.2008, 02.07.2008 and 11.07.2008 respectively were duly communicated through EDI System and after examination order from the Committee of Examination. Such assessment orders are undisputedly appealable orders but no appeal was preferred by either side or the order of assessment reached its finality and till date stands proper and valid. Subsequent issuance of purported orders appears in order to avoid the limitation. There is no requirement under law for passing of such purported second order. This is so held by the Honble High Court, Calcutta in the case of M/s.Al Saif International in appeal being CUSTA No.5 of 2011. Under the provisions of section 17(5) of the Customs Act, 1962, the proper officer is required to issue an order when the assessment is in contrary to the claim of the importer and the importer asked for the same. In such occasion also the speaking order of assessment is required to be made within 15 days from the date of assessment. The communication from Board, as relied upon by the department with respect to issuance of speaking order by the subsequent officer, has no footing in law inasmuch as the same is neither a notification nor a circular or instruction but merely a communication. The said communication does not confer an indefinite period for passing of speaking order by the subsequent officer even after communication of the order of assessment. Contention of the respondent is that the department has placed reliance upon the earlier orders passed by the Ld.Commissioner(Appeals) allowing with review applications in the similar cases but the said orders are no more in effect inasmuch as the Honble High Court, Calcutta has already set aside such order of Ld.Commissioner(Appeals) as well as order of the Tribunal holding the same. The review orders passed by the Commissioner those similarly situated cases had been quashed by the Honble High Court, Calcutta in the order referred supra.
5.2 Ld.Advocate for the respondent submitted that from para 7 at page 6 of the order of Ld.Commissioner (Appeals) it would be evident that the jurisdictional Commissioner on 21.07.2009 has ordered for passing of speaking order and hence, the fact of passing of order was well within the knowledge of the jurisdictional Commissioner at least on 21.07.2009 but the order in review was passed on 27.10.2009 i.e. beyond a period of 3 months. The statute provides for passing of review order only within a period of 3 months and in the instant case the same was made beyond the period of 3 months and there was no application for condonation of delay before the ld.Commissioner(Appeals) and hence, the review application itself is not maintainable.
5.3 Ld.Advocate also contended that fresh show cause notices had been issued to the appellants on 23.09.2011, 31.03.2010 and 25.10.2011 respectively whereas, it was contended by the department, in the grounds of appeal at para 17(n) that the Order-in-Original is required to be set aside so that fresh show cause notices can be issued on the facts unearth during investigation and till date the Order-in-Original has not been set aside by any authority. Hence, the subsequent show cause notices are beyond jurisdiction and contrary to the grounds of appeal of the Revenue.
5.4 Accordingly ld.Advocate prayed that the appeals filed by the Revenue may kindly be dismissed and the order of the Ld.Commissioner(Appeals) rejecting the review application may kindly be upheld in view of the order of the Honble High Court, Calcutta in the case of M/s.Al Saif International.
6.1 We have carefully considered the submissions and perused the record. The departments case is that DRI has unearthed certain fraudulent mis-declarations by bursting the bails and as such the issue should have been decided on its merits so that the issue could have reached to its logical conclusion. However, the ld.Commissioner(Appeals) had dismissed the appeals as time barred and also cast aspersions on the department for perpetuating fraud without bringing out anything on record. The relevant portion of the order-in-appeal reproduced hereunder:-
12. In all the cases, no doubt Shri S.C. Pal, Additional Commissioner adjudicated the cases but he recorded his findings in just six lines, which have been reproduced in paragraph 8 above. Nothing beyond that has been either been written, dictated or mentioned by him in any of the files. On the other hand, the appraiser Group 3 and Dy.Commissioner Gr.3 have in each case, prepared orders on their own, to be put up to the present Additional Commissioner, as if such orders were passed by Shri S.C.Pal. Evidence on record unequivocally indicates that no such impugned orders were ever passed by Shri S.C. Pal, the then Additional Commissioner. In each and every case, these officers have in July and August, 2009, prepared such orders, and have given colour to such orders, including sentences in first person, as if such orders were passed by Shri S.C. Pal. This is nothing but fraud and the impugned orders are nothing bur fabricated orders. I would, however, like to state that these officers did not have any self motive in preparing these orders. They only did so for the larger interest of the Department. No aspersions are cast on them. But as has been held by the Supreme Court and the various courts, Fraud vitiates everything. Therefore, the Review Applications cannot lie against such subsequently prepared orders and the orders which were never in existence at the time Shri S.C. Pal adjudicated the cases. Having coming to know these revealing facts, from the study of these files, I am constrained not to admit such appeals in respect of such of the non-existent and later prepared impugned orders.
(Emphasis supplied) 6.2 The above observation of the ld.Commissioner(Appeals) is unwanted and uncalled for. It is pertinent to mention that Honble Supreme Court in the case of Amar Pal Singh v. State of Uttar Pradesh & Anr. 2012 AIR SCW 2964 held as under:-
A judge functioning at any level has dignity in the eyes of public and credibility of the entire system is dependent on use of dignified language and sustained restraint, moderation and sobriety. It is not to be forgotten that independence of judiciary has an insegregable and inseparable link with its credibility. Unwarranted comments on the judicial officer creates a dent in the said credibility and consequently leads to some kind of erosion and affects the conception of rule of law. The sanctity of decision making process should not be confused with sitting on a pulpit and delivering sermons which defy decorum because it is obligatory on the part of the superior Courts to take recourse to correctional measures. 6.3 We find that the department placed reliance on Boards letter No.F.No.450/74/3-CUS.IV dated 17.4.1974 which envisages that in the cases wherein, the gist of the orders of adjudication was verbally communicated to the concerned parties representatives at the end of the hearing, by the adjudicating authority, and also by endorsement in the relative bills of entry bearing the endorsement pertain to the fine/penalty imposed by the adjudicating officer, there seems to be no legal objection to the successor in office communicating such order formally to the parties. The case of the department is that for the review purpose the date would be reckoned would be from the date of order passed by the lower adjudicating authority and not the date of assessment of bill of entry. In case the date of passing of order is taken there will not be any delay in case of review order passed under section 129D of Customs Act, 1962.
6.4 We find that so far as para 13 of ld.Commissioner(Appeals)s order wherein it has been recorded that respective importers have already paid the extra duty, fine etc. is concerned, the department has challenged the same and contended that only in the case of one Bill of Entry the respondent has paid the duty and during the hearing of these cases, the respondent could not submit any document contradicting the departments submissions that duties were paid on 9 bill of entries were not paid.
6.5 So far as the contention of the respondent that the jurisdictional Commissioner on 21.07.2009 has ordered for passing of speaking order and hence, the fact of passing of order was well within the knowledge of the jurisdictional Commissioner at least on 21.07.2009, we find that is not an endorsement for communication to jurisdictional Commissioner, but it is an endorsement of Boards Circular for issuance of speaking order by successor officer as already discussed in paras (supra).
6.6 So far as the reliance placed by the respondent on Honble High Court at Calcuttas decision in the case of M/s.Al Saif International (supra) cited by ld.Advocate is concerned, we find that Honble High Court of Calcutta vide its order No.CUSTA No.5 of 2011 dated 23.12.2011 has proceeded on the basis that deptt. failed to produce records despite of repeated opportunity given to them. The relevant portion of that order is reproduced hereunder:-
In order to substantiate her contention that the order dated 08.09.2008 had not been communicated to the Commissioner prior to the passing of the subsequent reasoned order dated 16.02.2009 we gave an opportunity to Ms.Bhargava to produce records of the instant case from the Customs Department. 6.7 We find that above aspects were not considered by ld.Commissioner(Appeals) while deciding the appeal. The same are required to be examined. In these circumstances ld.Commissioner(Appeals)s order is set aside and ld.Commissioner(Appeals) is directed to decide the matter afresh. Both sides are at liberty to produce documents in their support. Needless to say a reasonable opportunity of hearing may be granted to the respondents. Appeals allowed by way of remand.
(Pronounced in the open court on 25.09.2012.) Sd/ sd/ (D.M.MISRA) (S.K. GAULE) MEMBER(JUDICIAL) MEMBER(TECHNICAL) sm 11 Appeal No.Cus.Ap.75, 78 & 82/10