Custom, Excise & Service Tax Tribunal
M/S. S.K. Enterprises vs Commissioner Of Central Excise on 26 September, 2013
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. III
Customs Appeal No. 3079 of 2012-Cus [DB]
[Arising out of Order-In-Appeal No. 131/Cus/Appl/DLH-IV/2012 dated 26. 9.12 passed by Commissioner of Central Excise (Appeals), Delhi IV.]
For approval and signature:
Honble Ms. Archana Wadhwa, Judicial Member
Honble Mr. Manmohan Singh, Technical Member
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
3
Whether Their Lordships wish to see the fair copy of the Order?
Seen
4
Whether Order is to be circulated to the Departmental authorities?
Yes
M/s. S.K. Enterprises Appellant
Vs.
Commissioner of Central Excise, Respondent
Delhi IV Appearance:
Shri Prem Ranjan, Advocate for the Appellants Shri R.K. Mishra. DR for the Respondent Coram: Honble Ms. Archana Wadhwa, Judicial Member Honble Mr. Manmohan Singh, Technical Member Date of Hearing : 25.07.2013 Date of Decision : 26.09.2013 ORDER NO . FO/ 57720 /2013-Cus(Br) Per Ms. Archana Wadhwa (for the Bench) :
The appellant is engaged in trading of tyres and placed an order for import of the same to one M/s. Golf Coast Company Sharjah. However, on receiving the documents like bill of lading invoices and its packing list, he fund that goods were not as per their order. They accordingly took up the matter with the supplier, who informed them that it was a wrong shipment and same may be re-exported. The appellant vide their letter dated 12.7.12 informed the Revenue that these goods have been sent wrongly by the supplier and accordingly requested to allow them to re-export the same. They also informed that as the supplier was ready to pay the freight and the local haulage charges etc. they may be permitted to re-export the goods without delay.
The Revenue, however directed the appellant vide their letter dated 24.7.12 to file bill of entry for examination and informed that further necessary action could be taken as per law. Accordingly, the appellant filed a bill of entry dated 26.7.12 for clearance of 1531 new car radial tyres like Bridgestone, Dunlop, Michelin and Pirellil of various sizes ranging from 15 to 20 against invoice value of 47765 US dollars. The goods were taken up for 100% examination. Inasmuch as the same were not carrying any MRP as also BIS mark and the value was also not accepted by the Revenue, the matter was taken up for adjudication.
2. In terms of pneumatic tyres and tubes for Automotive Vehicles (Quality Control) Order, 2009, issued by Ministry of Commerce and Industry under Section 14 of Bureau of Indian Standards Act, 1986, which came into force w.e.f. 13.5.2011, it is provided that no person shall by himself or through any person on his behalf manufacture, import store for sale, sell or distribute Pneumatic tyres which do not conform to the specified standard by the Bureau of Indian Standards and which do not bear the Standard Mark of the Bureau. However, specified Pneumatic tyres that are not domestically manufactured and are therefore imported by Original Equipment Manufacturers (OEMs) are exempt from this stipulation.
3. Inasmuch as admittedly, the tyres in question were without any BIS standard marks embedded on the same and inasmuch as the same were not covered in any of the exemption notified by the Board vide its various instructions dated 29.11.11, 15.12.11 and 30.1.12, the said goods were prohibited for import in terms of section 2(33) and Section 11 of the Customs Act, 1962 read with the Pneumatic Tyres and Tubes for Automotive Vehicles (QC) Order, 2009. Further exempted category of tyres which are not manufactured in India, could be imported only by the original equipment manufacturers. Revenue also referred to import of identical tyres at the other ports and found that the value declared by the appellant was much on the lower side.
4. Accordingly, the original adjudicating authority enhanced the value of the tyres to Rs. 63,61,682/- and allowed the re-export of the same on payment of redemption fine of Rs.15 lakhs and also imposed penalty of Rs.5 lakhs under Section 112 of the Customs Act. The appellants filed an appeal against the above order before Commissioner (Appeals) and submitted that inasmuch as the redemption fine and penalty imposed upon the appellant is much on the higher side and the goods have also incurred demurrage charges, their foreign supplier has requested them to clear the goods on payment of duty. Alternatively prayer of re-export was also made.
5. Commissioner (Appeals), by considering the fact that this was the first consignment of the appellant and there is no finding on record that the appellant has been indulging in such activity before the import of present consignment, reduced the redemption fine to Rs. 7 lakh and penalty to Rs.3.50 lakhs. Hence the present appeal.
6. After hearing the learned advocate Shri P. Ranjan, for the appellants and Shri R.K. Mishra, learned DR for the Revenue, we find that admittedly, the tyres in question are not importable in terms of Pneumatic Tyres And Tubes for Automotive Vehicles (Quality Control) Order, 2009 issued by Ministry of Commerce and Industry inasmuch as they do not bear the standard mark of Bureau. Further, the appellant is also not entitled to import such tyres which are not domestically manufactured inasmuch as they are not the original equipment manufacturers. As such, the only question required to be decided is as to whether the appellant should be allowed to re-export the goods without any redemption fine and imposition of penalty.
7. It is noted that the appellant, after the import of the goods and before filing the bill of entry took up the matter with the foreign supplier who agreed to have sent the wrong consignment to the appellant. As such, the prayer was made by them to re-export the goods. However, instead of deciding on the said prayer of the appellant, they were advised to file a Bill of entry. It was in these circumstances that the appellant filed a Bill of entry along with invoice numbers. When the appellant has himself brought the fact of wrong shipment to the notice of the Revenue authorities, without filing the Bill of entry, subsequent filing of bill of entry by him cannot be held to be a cause for mis-declaration of the quality or the value of the goods.
8. We also take note of the Tribunals decision in the case of Guru Ispat Ltd. vs. CCE reported in [2003 (151 ELT 384 (Tri-Cal)] wherein the re-export of the wrongly shipped goods by the foreign supplier was allowed, by taking into account the bonafide of the appellants, by taking immediate steps, on detection of wrong shipment and by holding that there cannot be any malafide on the part of the assessee. The said order of the Tribunal stand upheld by the Honble Supreme Court when the appeal filed by the Revenue was rejected as reported in 2005 (157 ) ELT A 87. To the similar effect is another decision of the Tribunal in the case of Aniketa Krishna International vs. Commissioner of Central Excise, Jaipur [2012 (280) ELT 131 (Tri)].
9. In such a scenario, the imposition of any redemption fine or penalty on the allegations and findings of mis-declaration cannot be held to be justified. Accordingly, we set aside the impugned order and accept the appellants request for re-export of the goods without any redemption fine or penalty. The authorities below are directed to allow the re-export within a period of 30 days from the receipt of this order.
10. The appeal is disposed of in the above manner.
(Pronounced in the open court on 26.09.2013)
( Archana Wadhwa ) Member(Judicial)
(Manmohan Singh) Member(Technical)
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