Custom, Excise & Service Tax Tribunal
Sheikh &Amp Mahajan Llp vs Commissioner Of Customs ... on 3 December, 2021
Author: Dilip Gupta
Bench: Dilip Gupta
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI
PRINCIPAL BENCH
CUSTOMS APPEAL NO. 52368 OF 2019
[Arising out of Order-in-Appeal No. CC(A)/CUS/D-II/PREV/533/2019-20 dated
14.06.2019 passed by the Commissioner of Customs (Appeals), New Delhi]
M/s Sheikh & Mahajan LLP Appellant
786, Ground Floor, Gali No. 6A,
Zakir Nagar, Okhla, New Delhi.
Versus
Commissioner of Customs (Preventive), Respondent
New Delhi
New Custom House, Near IGI Airport,
New Delhi-110037.
Appearance
Shri V.V. Gautam, Advocate, Ms. Isha Vashisht, Advocate and Shri Anshul
Mittal, Advocate for the Appellant
Shri Rakesh Kumar, Authorized Representative for the Respondent
CORAM : HON'BLE MR. JUSTICE DILIP GUPTA, PRESIDENT
HON'BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)
Date of Hearing : 28.06.2021
Date of Decision : 03.12.2021
FINAL ORDER NO. 52052/2021
P.V. SUBBA RAO :
This appeal is filed by the appellant assailing the order-in-
appeal 1 dated June 14, 2019 passed by the Commissioner of
Customs (Appeals), New Delhi rejecting the appellant‟s appeal and
1
Impugned order
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upholding the order-in-original dated June 14, 2018 passed by the
Additional Commissioner of Customs (Preventive), New Delhi.
2. The appellant filed Bill of Entry No. 4927337 dated
24.01.2018 through its Custom House Agent 2 M/s Ananya Exim.
Receiving information about mis-declaration of the goods in terms
of quantity and value in this consignment, the goods were
examined and then seized by the Customs officers on 7.2.2018.
The Panchnama states that "as the goods were found to be mis-
declared in terms of quantity and value, imported goods were
seized under Section 110 of the Customs Act, 1962" vide seizure
Memo dated 7.2.2018 on reasonable belief the same were liable for
confiscation under provisions of the Customs Act, 1962. The
consignment was handed over to the Central Warehousing
Corporation 3 Patparganj which was the custodian of the imported
goods. On 12.2.2018, the appellant requested that the goods may
be warehoused which was permitted by the Department and
thereafter re-examined in detail. As recorded in the Panchnama
drawn on 27.2.2018, during examination of the goods, it was also
noticed that the imported goods had mentioned brands such as
AIR, MAX, logo of Adidas, Puma, Nike, etc. The details of the shoes
found as recorded in the Panchnama are as follows:
Sl. Carton No. Description of goods Brand Name/logo
No.
1. 1 Men‟s shoes AIR on shoes and Nike on Shoe
Flap
2. 6 Men‟s shoes Unbranded Shoes
3. 13 Men‟s shoe Unbranded Shoes, along with
Adidas logo found separately
4. 216 Men‟s shoes Logo of horse on the shoes
5. 227 Men‟s shoes Logo of horse on the shoes and
Puma mentioned on Shoe Flap
6. 255 Men‟s shoes Max mentioned on Shoes
2
CHA
3
CWC
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7. 288 Men‟s shoes Logo of Men on Shoes
8. 361 Men‟s shoes Logo of Nike, Presto BRS100,
Duralon, AIR (Printed on Shoes)
3. Summons were issued to the importer and Shri Asif
Farooque, Director of the appellant firm responded and gave a
statement on 28.2.2018 in which he, inter alia, said that he had
imported the goods on credit of 90 days and has yet to pay his
Chinese supplier; regarding the mis-declaration of men‟s shoes as
boy‟s shoes, he said that there was no difference in the tariff head
between boys and men‟s shoes and they had imported declaring
them as boys shoes; the maximum retail price4 was not embossed
properly on some shoes but he said that he would get the same
embossed. He also said that he was ready to pay the differential
duty, if any. With regard to the difference in quantity of shoes
covered by Invoice No. KM-1059 dated 29.11.2017 he said that he
would discuss it with their Chinese counterpart and explain later.
Regarding the shoes bearing marks such as AIR, Max, logo of Men
printed on shoes and branded NIKE shoes he explained that he was
only a trader of unbranded shoes and would clarify after consulting
the Chinese counterpart. He also asserted that the shoes bearing
brand names like NIKE and Puma on the flaps do not belong to the
appellant as it had never ordered the same. After discovering that
these names were on the flaps, he contacted his Chinese
counterparts who said that due to mistake of their labour, they
dispatched those shoes which were actually not meant for him. He
asserted that such shoes were accidentally mixed with their goods
and they do not belong to him. He agreed that the goods were mis-
4
MRP
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declared in terms of description as well as value as the same have
been wrongly sent by the supplier. Regarding the valuation of the
goods (since the goods which were imported were not tallying with
the invoice), he suggested that a joint market enquiry be
conducted to ascertain the actual price of the goods. Accordingly, a
joint enquiry was conducted in which Shri Asif Farooque also
participated along with the officers. Based on the survey, the
prices declared by the appellant in the Bill of Entry were rejected
and the price was arrived at by deductive method from the market
price of the goods after deducting the retailer‟s margin and
importer‟s margin, post import expenses and duty.
4. The goods in question were, therefore, not as per the
declarations made both in terms of quantity and quality. On the
suggestion of the appellant, a joint market survey was conducted
along with the appellant and based on the market price, the
assessable value was determined through deductive method. There
were also brand names of Nike, Puma and Adidas and the
appellant‟s clarification was that those goods were sent by mistake
to them by the supplier.
5. Imported goods which are suspected to have violated
Intellectual Property Rights 5 have to be dealt with as per the
Intellectual Property Rights (Imported Goods) Enforcement Rules,
20076 framed under the Customs Act. The right holder i.e., the one
who has the IPR has to issue a notice under Rule 3 to the Principal
5
IPR
6
Rules
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Commissioner, or Commissioner of Customs along with fees. The
Commissioner of Customs has to take a decision within 30 working
days and notify the applicant Rights holder whether the notice has
been registered or rejected and also the validity period of the
registration (Rule 4). Registration under Rule 4 is subject to
execution of a bond under Rule 5(a) and indemnity bond under
Rule 5(b). Once the right holder applies for (Rule 3) and is
registered (Rule 4) with the Commissioner of Customs, import of
infringing goods into India shall be deemed to be prohibited (Rule
6) within the meaning of Section 11 of the Customs Act, 1962.
Thereafter, in terms of Rule 7(1)(a) if the Deputy Commissioner or
Assistant Commissioner of Customs has reason to believe that any
goods are infringing the IPR, he shall suspend their clearance and
inform both the importer and the right holder of the suspension of
goods and the reasons therefor. The right holder has the right (Rule
8) to examine suspended goods and take samples, test and analyse
to assist in determining whether the goods are pirated, counterfeit
or otherwise infringe an intellectual property right. Rules 9 and 10
require the Assistant Commissioner, Deputy Commissioner to
supply information to the right holder and the importer
respectively.
6. Even if the Right Holder does not issue a notice under Rule 3
and no registration is granted to the right holder under Rule 4, the
Deputy Commissioner or Assistant Commissioner may, under Rule
7(1)(b), on his own initiative, suspend the clearance of goods in
respect of which he has prima facie evidence that they are
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infringing IPR. In such a case, the right holder has to fulfill the
obligations of issuing a notice under Rule 3 and fulfill the condition
under Rule 5 for registration within five days from the date of
suspension of clearance; else, the goods should be released. Rule 7
also requires the right holder to join the proceedings within 10
working days from the date of suspension of clearance of the goods
which limit can be extended by the Commissioner for another 10
days.
7. In this case, when a reference was made by the officer, the
Deputy Commissioner (IPR Cell), has, on 22.2.2018, informed that
NIKE, Puma, Adidas are registered with them as right holders under
the IPR Rules, 2007. Accordingly, letters dated 5.3.2018 were
issued to M/s Nike, Adidas and letter dated 6.3.2018 to Puma
asking them to join the proceedings in terms of rules and they did
so and after examining the goods, reported as follows:
Report of Adidas and conclusion:
i. The right holder is the owner of the trademark "adidas" (word) and
logos "Three Stripes", "Trefoil", "Three Bars" and entitled to use the
trademark "adidas" and logos "Three Stripes", "Trefoil" and "three
bars" under the Trademarks Act in India.
ii. The 3-stripes mark is the quintessential adidas symbol.
iii. M/s Sheikh & Mahajan LLP has imported consignment consisting of
goods which bear either the trademark "adidas" and/or logos Three
stripes, Trefoil and three bars and/or marks deceptively and confusing
similarly to trademark "adidas" and logos "Three Stripes", "Trefoil"
and "three bars" and shall cause confusion and deception amongst
the purchasing public and trade,
iv. The counterfeit goods imported by M/s Sheikh & Mahajan LLP, wherein
trademark "adidas" and logos Three stripes and three bars have been
used in deceptively and confusingly manner are deceptively and
confusingly similar to the three bars logo of the Right Holder.
v. On a close scrutiny of the infringing products following similarly and
dissimilarity, the differences between a genuine "adidas" and sample
of "adidas" shoes handed over to him are as follows:
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Sl.No. Original Product Counterfeit Products
1. The label fixed on the tongue is The quality of label is poor
heat sealed and is not properly sealed
2. Every label should contain a The unique security code
security code. A security code existing on the tongue is
is made up of 13 digit numbers incorrect, which means that
and English Alphabets. Every the sample product is a
security code is unique fake product.
3. Information on the tongue label The information on the
should set out in the order tongue are incorrect,
incomplete and in an
incorrect order. The label
in totality renders the
sample product a fake
product
4. The label contains complete The label attached to the
information of every product sample product does not
individually. The information contain the correct
contained are: information which every
The country of origin genuine product must
Size contain. The sample
Adidas article code product does not contain
Factory code the correct place of
Unique security code manufacture, factory code,
Adidas purchase order no. production date, adidas
Production date article code, unique
Two dimensional bar code security code is missing,
adidas purchase order no.
and bar code is fictious,
incorrect coding and
numbering of the above
mentioned salient features
in the sample product
handed over to us proves
that it is a fake product.
Absence of the above
mention salient features in
the sample product over
handed that it is a fake
product.
5. The raw material and the The raw material and the
technology used in the technology used in the
manufacturing of a genuine manufacturing of the
product is of a very good quality sample products handed
and standards and thus the over to us is of poor quality
overall finish and the quality of and the product as a whole
a genuine product is very is poorly finished with poor
superior pasting and stitching which
is evident on comparison
with a genuine product.
Thus the poor quality and
finish of the product
handed over is a fake
product.
6. The trademark (i.e. word marks The trademarks have been
and/or logo) are in a fixed applied shabbily and also
proportion. are not in proportion which
proves that the sample of
shoes as fake product.
7. On the genuine adidas handed In the samples handed over
over have three parallel equi to us, the said three stripes
spaced strips at a forward slant is not properly fixed and
of the upper and/or a trefoil paced. Also, the shoes
with three stripes. Also, the were packed in polythene
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goods are packed in good bags.
quality boxes.
8. Embroidery/stitching work on Embroidery/stitching &
the original product is of pasting done samples
superior quality collected is of poor quality
which renders the sample
product a fake product.
9. Detailed information in As the shoes were found to
compliance of Legal Metrology be packed in polythene
Act, 2009 about every product bags, Mrp, Label is missing
is set out in adidas/Mrp Label on the packaging of the
attached to the box of every shoes.
product. The information
contained are:
Product
Quantity
Size
MRP
Date of Manufacturing
Name and address of
Manufacturer/Customer Care
Cell
Email
TWO DIMENSIONAL BAR CODE
Article No.
10. The security label fixed on the There is no Security label
shoes contains adidas logo fixed on the shoes. The
along with a printed bar code, Care label is also missing
which is unique for every on the security label
individual product. The Care attached to the shoes.
label attached to the shoes
contain reasonable care to be
taken for maintaining the
product which is unique for
every individual product.
Report of M/s Puma and conclusions
8.1 Sample analysis findings:
i. The appearance/design/style of the shoes does not match with
PUMA design.
ii. The fulfillment of the product sample is of inferior quality.
iii. The material used to manufacture the product is of inferior
quality, not matching the standards of original PUMA product.
iv. The packaging of the product does not match the standards of
original PUMA products.
v. The size of the PUMA leaping Cat device on the shoes does not
match with the standards of original PUMA product.
vi. The finishing of the product is not matching with the standards
of original PUMA product.
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vii. The form strip shown in the images is stated as counterfeit in
the below image.
viii. The images mentioned are stated as counterfeit and should not
be released under any circumstances.
ix. The side strip used in the design of the shoe is also counterfeit.
x. The shoe flap are the essential part of the shoe bearing the
brand name of PUMA imported by Sheikh and are counterfeit
product and can‟t be released if any circumstances.
8. Although Nike also submitted its report, it has not
subsequently submitted the required bond and bank guarantees
with respect to this consignment and hence in the impugned order,
the rights of Nike were not enforced.
9. It, therefore, appeared that all the goods imported by the
appellant except those with „Max‟ mentioned on them were
counterfeit goods. The details of the various types of goods
imported by the appellant in terms of the IPR violations were as
follows:
Sl. Description of Total Total Remarks
No Shoes (Brand) Cartons Quantity
. (in Pairs)
1. AIR (Mentioned on 97 2302 The said product was checked by
Shoes) the authorized representative of
NIKE and after examination of
the same, they informed that the
said product pertain to NIKE
brand. The authorized
representative vide their letter
dated 14.0.3.2018 has informed
that the goods are counterfeit
products.
2. Unbranded Shoes 83 1986 The products was checked by the
authorized representative of
ADIDAS and after examination of
the same, they informed that the
said product pertain to ADIDAS
brand. The authorized
representative vide their letter
dated 14.03.2018 has informed
that the goods are counterfeit
product.
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3. Max (Mentioned on 50 1200 There was no IPR on the brand
Shoes) name Max.
4. Logo of Horse on 60 1420 The DC (IPR) has informed
Shoes that the said product is not
registered with Customs.
However, the products was
checked by the authorized
representative of PUMA and
after examination of the
same, they informed that the
said product pertain to Puma
brand. The authorized
representative vide their
letter dated 14.03.2018 has
informed that the goods are
counterfeit products.
5. Logo of Man printed 144 3456 The DC (IPR) has informed
that the said product is not
registered with Customs.
However, the products was
checked by the authorized
representative of PUMA and
after examination of the
same, they informed that the
said product pertain to Puma
brand. The authorized
representative vide their
letter dated 14.03.2018 has
informed that the goods are
counterfeit products.
6. Logo of Nike Presto, BRS 30 720 The DC (IPR) has informed that
100, Duralon, AIR the NIKE brand is registered with
(Printed on Shoes) Customs. Also the said product
was checked by the authorized
representative of NIKE and after
examination of the same, they
informed that the said product
pertain to NIKE brand. The
authorized representative vide
their letter dated 14.03.2018 has
informed that the goods are
counterfeit products.
Total 464 11084
Description of Shoe
Flap (Brand)
FLAP NIKE 1770 Vide letter dated 22.0.3.2018 of
authorized representative, they
informed that there are
counterfeit products.
LOGO ADIDAS 4960 Vide letter dated
22.03.2018 of authorized
representative, they
informed that these are
counterfeit products.
FLAP PUMA 2890 Vide letter dated
12.03.2018 of authorized
representative, they
informed that these are
essential part of the shoes
and also counterfeit
products.
TOTAL 9620
10. As suggested by Shri Farooq in his statement, the prices of
the goods were ascertained through a joint market enquiry
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conducted along with the appellant. From the market price the
margin of profit of dealer @ 15% and importer @ 15% were
deducted. After deducting these two elements another 5% was
deducted as post-importation costs of importer. The price arrived at
after making these deductions was taken as the cum-duty price and
the assessable value was calculated backwards. On this assessable
value, the duty was determined. Before the original authority, the
appellant has accepted that the goods were mis-declared in terms
of value and description and undertook to pay the differential duty
fine and penalty, if any imposed by the Department. It also
categorically mentioned that it did not want any show cause notice
or an opportunity of personal hearing as all details relevant to the
case have already been explained to them and understood. They
requested to dispose of the matter early.
11. After examining the facts of the case, the original authority,
viz., the Additional Commissioner has passed the following order:
"(i) I reject the declared assessable value of Rs. 16,04,404/- for the
goods imported vide Bill of Entry No. 4927337 dated 24.01.2018 in terms
of Section 14 of the Customs Act, 1962 read with Rule 12 of the Customs
Valuation (Determination of Value of Imported Goods) Rules, 2007.
(ii) I re-determined the assessable value as Rs. 14,25,462/- for the
goods other than counterfeit goods (i.e. Unbranded Shoes as per
Panchnama dated 27.02.2018 (which are identified as shoes of adidas
brand on the basis of three strips vide technical report dated 14.03.2018
submitted by authorized representative of M/s Adidas ad on the basis of
which they claimed their IPR), Logo of Horse on shoes and Man Printed on
Shoes (regarding which M/s Pume Se has claimed its IPR through its
authorized representative vide its technical report dated 21.03.2018)
imported vide Bill of entry No. 4927337 dated 24.01.2018, under Section
14(1) of the Customs Act, 1962 read with Rule 5 & Rule 7 of the Customs
Valuation (Determination of Value of Imported Goods) Rules, 2007.
(iii) I order for confiscation of the goods other than counterfeit goods
(i.e. Unbranded Shoes as per Panchnama dated 27.02.2018 (which are
identified as shoes of adidas brand on the basis of three strips vide
technical report dated 14.03.2018 submitted by authorized representative
of M/s Adidas and on the basis of which they claimed their IPR), Logo of
Horse on shoes and Man Printed on Shoes (regarding which M/s Puma Se
has claimed its IPR through its authroised representative vide its technical
report dated 21.03.2018) valued at Rs. 14,25,462/- covered under Bill of
Entry No. 4927337 dated 24.01.2018 under Section 111(l) & (m) of the
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Customs Act, 1962. However, I give an option to the importer to redeem
the said goods i.e. Shoes Max (Mentioned on Shoes), Shoes "Mark AIR" ,
Shoes (Logo of "Nike Presto") on payment of redemption fine of Rs.
15000/- under Section 125(1) of the Customs Act, 1962.
(iv) I confirm the consequential Customs Duty amounting to Rs.
3,93,133/- in respect of the goods other than counterfeit goods (shoes
bearing the brand name "Adidas and Puma) imported vide Bill of Entry
No. 4927337 dated 24.01.2018 (as discussed above against the importer,
M/s Sheikh & Mahajan LLP 786, ground Floor, Gali No. 6A, Zakir Nagar,
Okhla, New Delhi (IEC-ADJFS8130M) under Section 28(1) of the Customs
Act, 1962. I order for recovery of confirmed Customs duty of Rs.
3,93,133/- in respect of the goods other than counterfeit goods (Shoes
bearing the brand name "Adidas & Puma) under Section 28 of the
Customs Act, 1962 from the importer.
(v) I impose a penalty of Rs. 3,93,133/- on M/s Sheikh & Mahajan LLP
786, ground Floor, Gali No. 6A, Zakir Nagar, Okhla, New Delhi (IEC-
ADJFS8130M), the importer under section 114(A) of the Customs Act,
1962 with an option that the importer shall be eligible for reduced penalty
as prescribed under Section 114A, subject to compliance therein.
(vi) I order for absolute confiscation of the counterfeit goods (i.e.
unbranded Shoes as per Panchnama dated 27.02.2018 (which are
identified as shoes of adidas brand on the basis of three strips vide
technical report dated 14.03.2018 submitted by authorized representative
of M/s Adidas and on the basis of which they claimed their IPR), Logo of
Horse on shoes and Man Printed on Shoes (regarding which M/s Puma Se
has claimed its IPR through its authorized representative vide its technical
report dated 21.03.2018) collectively valued at Rs. 72,29,117/- covered
under Bill of Entry No. 4927337 dated 24.01.2018, under Section 111(d)
& (l) of the Customs Act, 1962 read with IPR (Imported Goods)
enforcement Rules, 2007.
(vii) I impose a penalty of Rs. 220000/- on M/s Sheikh & Mahajan LLP
786, ground Floor, Gali No. 6A, Zakir Nagar, Okhla, New Delhi (IEC-
ADJFS8130M), the importer under section 112 of the Customs Act, 1962
however the importer shall be eligible for reduced penalty as prescribed
under Section 112, subject to compliance therein."
12. On appeal, the Commissioner (Appeals) passed the impugned
order upholding the above order of the Additional Commissioner.
The appellant has filed this appeal assailing the impugned order on
the following nine grounds:
(i) None of the goods imported by the appellant under
subject bill of entry are prohibited, in terms of Section 11 of
the Customs Act, 1962 read with Rule 6 of IPR Rules ibid,
which provides that for being deemed prohibited under
section 11 of Customs Act, 1962, the right holder needs to
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obtain registration from the Commissioner and after
registration, if on examination, it is found that alleged goods
are infringing the right of right holder, the goods shall be
deemed as prohibited. In the instant case, it is evident from
the report of Assistant Commissioner, which has been quoted
by the learned Original Authority at page No. 8 of the order in
original (which is placed at page No. 185 of the paper book),
wherein in the chart at serial No. 4 & 5, it is mentioned that
logo of Horse on shoes and logo of men printed is not
registered with customs. Since the goods of these two
brands are not registered with the Customs, in terms of Rule
6 of IPR Rules read with Rule 11 of Customs Act, 1962, the
goods are not prohibited and, thus, the seizure, confiscation,
imposition of penalty upon the goods and demand of duty is
illegal and liable to be set aside.
(ii) The confiscation of goods under section 111(d) & (m) of
the Customs Act, 1962 is illegal, as there is no mis-
declaration of either description of goods, brand and value.
(iii) The rejection of value of the impugned goods under
section 14 of the Customs Act, 1962 is illegal as value can be
rejected only in exceptional circumstances, as defined under
Section 14 such as when the buyer and seller are related,
price is not the sole consideration and there is no sale. In the
instant case, none of the factors exists.
(iv) Re-determination of assessable value under section
14(1) of the Customs Act, 1962 is arbitrary and illegal, as in
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accordance with section 14, the assessable value with the
transactional value and the appellant has declared the
transactional value paid by him, as mentioned in the invoice
issued by the shipper/overseas supplier and the officers of
preventive did not produce any document justifying that the
appellant has paid any amount over and above the
transaction value to the shipper/supplier of the subject
goods, onus to prove under valuation is upon the revenues,
which is a settled law.
(v) The confiscation of goods cleared on higher assessed
value (upon which the duty has been paid by the appellant at
enhanced rate, as the goods would have been destroyed and
decayed, which is the case with the balance goods which are
absolutely confiscated by the learned Original Authority, as
per the inspection done by the appellant of the goods at
Warehouse, where the goods have been warehoused pending
clearance) is illegal, arbitrary, contrary to the provisions of
section 111(d) & (m) of the Customs Act, 1962.
(vi) The absolute confiscation of goods having men mark,
horse mark and three strips is illegal, as these two marks are
not registered with the customs, as per the report of D.C.
Customs and are not prohibited, in terms of Rule 6 of IPR
Rules read with section 11 of Customs Act and similarly the
three stripped mark is a free mark, not the mark of Adidas.
The Adidas mark contains word "Adidas" (word) and logos,
three stripes and "Trefoil".
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(vii) Imposition of redemption fine of Rs. 15,000/- under
section 125(1) and penalty of Rs. 3,93,133/- upon the goods
under section 114A of the Customs Act, 1962 is illegal and
arbitrary, as there is no violation of IPR and Section 14 of
Customs Act, 1962 and Valuation Rules, by the appellant.
(viii) Without prejudice to the contentions and rights of the
appellant, imposition of penalty under section 112 of the
Customs Act, 1962 is contrary to the provisions of proviso 5
of Section 114A of the Customs Act, 1962, which itself
provides that where any penalty has been levied under
section 114A, no penalty shall be levied under Section 112 or
114.
(ix) The impugned order in original and order in appeal are
liable to be set aside, in terms of order passed by this
Tribunal (Mumbai Bench) in case of SRK Enterprises Vs.
Commissioner of Customs (Imports) Nhava Sheva,
2012 (280) ELT 264 (Tri.-Mum.), wherein this Tribunal
observed that "since the timeline prescribed in IPR Rules
has not been followed (relying upon judgment of
Landom Distributors Pvt. Ltd. (Madras High Court),
provisions of IPR Act and Rules inapplicable)."
13. Learned Departmental Representative supports the impugned
order. On the first and sixth arguments of the appellant, learned
Departmental Representative submits that the shoes in question
not only had the logos of the horse and the man but also included
with device mark "FORM strip" and Trefoil besides Puma on the flap
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of the shoes and thereby infringed the IPR of Puma and Adidas and
were counterfeit goods. They violated the IPR of the right holder
and Puma. He submitted that the Delhi High Court has, in the
case of Puma Se & Anr Vs. Footwear (Klick) India Pvt. Ltd. &
Ors. in CS (OS) 2518/2015 dated 24.8.2012 held that the
device mark Form strip Puma, and marks are registered marks of
Puma besides catalog and the word Puma. Further, in PUMA SE &
ANR Vs. Dashmesh Footwear & Ors CS (COMM) 43/2015
dated 17.12.2015 also the High Court of Delhi concluded that the
form strip logo of Puma is registered in India and the right holders
of the same. It is, therefore, his submission that merely because
the shoes also had the men face and horse on them it does not
make a difference as long as they are violating/infringing some
right of trade mark holder which they did. Therefore, the goods
were prohibited goods in terms of Section 11 of the Customs Act
read with Rule 6 of the IPR Rules. Similarly, he submits that the
three strips are the trademark of Adidas and the right holders had
registered trademark Adidas and logos three stripes, trefoil and
three bars has belonging to it with the Customs under the IPR
Rules. He relies on the judgment of High Court of Delhi in
CS(COMM) 1269/2018 and IA 16629/2018 dated 14th May
2019. Learned counsel for the appellant relies on the Judgment of
the General Court of the European Union Press Release no.
76/19 in case T-307/17 adidas AG vs EUIPO in which it was
held that „ adidas does not prove that the mark has acquired,
throughout the territory of the EU, distinctive character following
the user which had made if three parallel equidistant stripes of
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identical width, applied on the product in any direction‟. For this
reason also the goods which were confiscated were deemed to be
prohibited goods under Section 11 of the Customs Act. With
respect to the second submission, that the confiscation under
Section 111(b) & (m) of the Customs Act is illegal and that there is
no mis-declaration of either description of the goods brand or
value, learned Departmental Representative submits that the mis-
declaration was evident and was admitted to by the appellant
themselves. Initially when the discrepancies were noticed,
summons were issued to Shri Asif Farooque, the Director of the
appellant firm who, in his statement before the Customs officers,
explained that the shoes with the flap bearing brand names Nike
and Puma and logo Adidas do not belong to him at all. He further
said that he had contacted his Chinese supplier and confirmed that
the labour has dispatched the wrong shoes accidently and they do
not belong to him. In fact, he said that he is trader in unbranded
shoes. The Bill of Entry mentions "non- popular brands". At no
point of time has he asserted that he has declared the goods which
were imported. What has declared in the Bill of Entry was clearly
different from what was imported. Shri Farooque also agreed that
the MRP was not properly embossed and said the same would be
got done on the shoes. Since the description of the goods was
different from those that of imported, Shri Farooque suggested that
a joint market survey to ascertain the price of the goods. This was
the statement by Shri Farooque, Director of the appellant. Another
Director of the appellant, Shri Rajeev Kumar Jaiswal also accepted
that the goods were mis-declared in terms of value and description
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and undertook to pay the differential duty fine and penalty
voluntarily, if any, imposed by the Department. He also waived
requirement of show cause notice as also the opportunity of
personal hearing as in this case as "all relevant details have already
been explained to them and he understood the same" and
requested to dispose of the case. These statements have not been
retracted. What has been admitted need not be proved although in
this case it has also been proved through the reports of the right
holders. The appellant has not taken the stand that there was no
mis-declaration before the original authority and has on the
contrary admitted to the same during the adjudication proceedings.
Therefore, the assertion of the learned Counsel that there was no
mis-declaration in terms of section 111(d) & (m) is without any
force.
14. With respect to the third and fourth ground of the appeal that
the transaction value should be accepted and the assessable value
of the goods should not have been re-determined, learned
Departmental Representative points to the fact that the goods
declared in the invoice and the Bill of Entry were different from the
goods which were imported. The nature, quantity and description of
goods were different. The appellant has agreed that they were
different. There is nothing on record to show that this statement
was made under any threat or coercion. In fact, the appellant has
sought clarification from its supplier from China and confirmed that
wrong goods have been sent to them. Therefore, a question arose
as to how to value the goods which were actually imported. The
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appellant himself has suggested that a joint market survey should
be conducted to ascertain the market price of the goods which
accepted and the assessable value may be deduced from it.
Thereafter, the appellant participated in the market survey along
with officers and the market prices of the goods were determined.
From the market prices the retailer‟s margin @ 15% and then the
importers margin @ 15% was deducted. A further 5% was
deducted as post importation expenses importer would have been
incurred. After these deductions what was left was taken the cum-
customs duty price of the imported goods and the assessable value
was worked backward it. The entire valuation was a joint exercise
by the Department and the importer appellant. The appellant did
not contest the valuation at the time of adjudication also.
Therefore, the argument that the transaction value should be
accepted as the assessable value has no force whatsoever
especially when the assessee has accepted that what was imported
were different from what were declared and further clarified from
its overseas supplier and confirmed that wrong goods were
imported which they had not ordered due to some supplier's end.
On the fifth ground that the confiscation of the goods cleared on
higher assessable value is illegal, arbitrary and contrary to the
provisions, learned Departmental Representative submits that
Section 111(d) provides for confiscation of any goods imported
contrary to any provisions imposed by or under Customs Act or any
other law for the time being for in force. Section 111(m) provides
for confiscation of goods which do not correspond in value or in any
other particular with the entry made under Customs Act. The entry
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in question is the Bill of Entry filed by the appellant. Admittedly, the
goods do not confirm to the description. As per the report of the
right holders given after examination of the imported goods, the
goods infringe the Intellectual Property Rights of the right holders.
Therefore, as per Rule 6 of the IPR Rules read with Section 11 of
the Customs Act they are prohibited goods. Therefore, confiscation
both under Section 111(d) and 111(m) is valid and proper. With
respect to the seventh ground that imposition of redemption fine
and penalty under the Customs Act is illegal and arbitrary, learned
Departmental Representative submits this submission has no force
because not only did the goods not correspond in description but
also in value. Therefore, the confiscation under Section 111 is
correct and as also the option of allowing redemption of the goods
non-IPR violating goods under Section 125(1). He also supports
the imposition of penalty under Section 114A of the Act. Learned
Departmental representative conceded on the eighth ground that
simultaneous penalty cannot be imposed under Section 112 and
114A. On ninth ground that the right holders had not joined the
proceedings in time i.e., within ten days of the detention of the
goods and, therefore, the entire process is vitiated, learned
Departmental Representative submits that the records demonstrate
that the goods were initially seized under a Panchnama on
information regarding mis-declaration. Thereafter on the
appellant's request, the goods were allowed to be warehoused and
they were re-examined. On re-examination it found that the goods
had marks which may lead to infringement of IPR of the right
holders. A reference was made to the Deputy Commissioner (IPR
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Cell) and he confirmed that Nike, Puma and Adidas were already
registered with the Customs Department and therefore, they held
registrations under Rule 4 of the IPR Rules. When letters were
written to three right holders they responded immediately and
joined the proceedings. The argument of the learned Counsel that
the right holders should have immediately filed a bond in respect of
this consignment is not correct because the rule nowhere requires
that a bond should be executed within ten days. It only requires
the right holder to join the proceedings within 10 days and they
did. This assertion of the learned Counsel is not supported by the
rule. The argument of the learned Counsel with respect to the
proceedings was that clearance of the imported goods was
suspended by the Deputy Commissioner on his own initiative and
therefore, this case is covered by Rule 7 (1)(b) is not correct. A
plain reading of the Rule 7 says that Rule 7(1)(a) deals with cases
where the right holder is already registered. Rule 7(1)(b) deals
with cases where the right holders are not registered. In this case,
the right holders have already been registered. If they were not
registered, they would have had to fulfill the obligations under Rule
3 and Rule 5 and get registered under Rule 4 and these obligations
would have to be fulfilled within five days of suspension of the
clearance of the goods. The present case is not covered by these
provisions because right holders were already registered.
Therefore, he submits that there is no force in the submissions of
the learned Counsel and his appeal may be rejected.
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15. We have considered the submissions on both sides. The
issues to be decided in this case are:
i) Were the goods which were confiscated absolutely
prohibited goods under Section 11 of the Customs Act
read with Rule 6?
ii) Were the goods seized by the Deputy Commissioner on his
own initiative under Rule 7(1)(b) or on the basis of a
registered right holder under Rule 7(1) (a)?
iii) Have the Right Holders joined the proceedings within the
time frame set out in the Rules or not and consequently
are the proceedings vitiated as asserted by the appellant?
iv) Was the rejection of the declared value of the impugned
goods under section 14 of the Customs Act, 1962 correct?
v) Was the re-determination of assessable value under
section 14(1) of the Customs Act, 1962 correct?
vi) Was the confiscation of goods under section 111(d) & (m)
of the Customs Act, 1962 correct?
vii) Was the absolute confiscation of goods having men mark,
horse mark and three stripes is illegal, as these two marks
were not registered with the customs but which also had
the three stripes and "Trefoil" mark?
viii) Was imposition of redemption fine of Rs. 15,000/- under
section 125(1) and penalty of Rs. 3,93,133/- upon the
goods under section 114A of the Customs Act, 1962
correct?
ix) Was the simultaneous imposition of penalty under section
112 and 114 valid?
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16. On the first question, the assertion of the learned counsel is
that the import of the impugned goods were not prohibited in terms
of Section 11 read with Rule 6 because as per the Report of the
Deputy Commissioner (IPR Cell) itself, the „Man‟ and „Horse‟ logos
used on the shoes were not registered with the customs. When the
logos themselves were not registered, there cannot be an IPR with
respect to these two logos. According to Rule 6, once the IPR is
registered, import of goods which infringe the IPR is deemed to be
prohibited under Section 11. Learned Departmental Representative
submits that the goods have not been confiscated for having the
logos of „Horse‟ and „Man‟ but because they also had the logos of
"FORM strip" besides Puma on the flap of the shoes. Once the IPR
of Puma is violated, it does not matter if the shoes also have some
other marks such as Horse and Man. We find that Rule 6 of the IPR
reads as follows:
6. Prohibition for import of goods infringing
intellectual property rights.- After the grant of
the registration of the notice by the Commissioner on
due examination, the import of allegedly infringing
goods into India shall be deemed as prohibited within
the meaning of Section 11 of the Customs Act, 1962.
17. What is to be examined is whether or not any registered IPR
have been infringed and if so, the import of the goods is prohibited
and not otherwise. The goods have some non-registered logos and
trademarks and also have certain registered IPR on them. A plain
reading of Rule 6 shows that import of goods is prohibited if the
registered IPR is violated and it does not make any exception to
goods which also have some other logos. It is immaterial how many
logos are on the goods. If they violate any IPR, their import is
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prohibited, and not otherwise. In this case, the shoes with Man and
Horse logos also had device mark "FORM strip" besides Puma on
the flap of the shoes. The Delhi High Court has in the case of Puma
Se held that the device mark Form strip Puma, and marks are
registered marks of Puma besides catalog and the word Puma.
Further in PUMA SE also the High Court of Delhi concluded that the
form striped logo of Puma is registered in India and the right
holders of the same. We find that the impugned goods have,
therefore, violated the IPR and the import of these goods was,
therefore, prohibited under Rule 6 read with Section 11.
18. Learned counsel for the appellant also argued that the goods
were detained by the Deputy Commissioner on his own initiative
and therefore, the proceedings fall under Rule 7(1) (b) and the
Right holders should have fulfill their obligations within five days
and since they have not, the goods should have been released.
Rule 7 reads as follows:
7. Suspension of clearance of imported goods.-
(1)(a) Where the Deputy Commissioner of Customs or
Assistant Commissioner of Customs, as the case may
be, based on the notice given by the right holder
has a reason to believe that the imported goods
are suspected to be goods infringing intellectual
property rights, he shall suspend the clearance of
the goods.
(b) The Deputy Commissioner of Customs or
Assistant Commissioner of Customs , as the case may
be, may, on his own initiative, suspend the
clearance of goods , in respect of which he has
prima-facie evidence or reasonable grounds to
believe that the imported goods are goods
infringing intellectual property rights.
(2) The Deputy Commissioner of Customs or
Assistant Commissioner of Customs , as the case may
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be, shall immediately inform the importer and the right
holder or their respective authorised representatives
through a letter issued by speed post or through
electronic mode of the suspension of clearance of the
goods and shall state the reasons for such suspension.
(3) Where clearance of the goods suspected to
be infringing intellectual property has been
suspended and the right holder or his authorised
representative does not join the proceedings
within a period of ten working days from the date
of suspension of clearance leading to a decision
on the merits of the case, the goods shall be
released provided that all other conditions of
import of such goods under the Customs Act,
1962, have been complied with:
Provided that the above time-limit of ten working days
may be extended by another ten days in appropriate
cases by the Commissioner or an officer authorized by
him in this behalf.
(4) Where the Deputy Commissioner of
Customs or Assistant Commissioner of Customs,
as the case may be, has suspended clearance of
goods on his own initiative and right holder does
not give notice under rule 3 of the Rules or does
not fulfill the obligation under Rule 5, within five
days from the date of suspension of clearance,
the goods shall be released provided that all other
conditions of import of such goods under the Customs
Act, 1962, have been complied with.
(5) Where the clearance of goods has been
suspended, customs may, where it acts on its own
initiative, seek from the right holder any information or
assistance, including technical expertise and facilities
for the purpose of determining whether the suspect
goods are counterfeit or pirated or otherwise infringe an
intellectual property right.
(6) Where the Deputy Commissioner of Customs or
Assistant Commissioner of Customs, as the case may
be, has suspended clearance of goods on his own
initiative and right holder has given notice under rule 3
of the Rules and fulfilled the obligations under Rule 5,
but , the right holder or his authorised representative
does not join the proceedings within a period of ten
working days from the date of suspension of clearance
leading to a decision on the merits of the case, the
goods shall be released provided that all other
conditions of their import under the Customs Act, 1962,
have been complied with:
Provided that the above time- limit of ten working days
may be extended by another ten working days in
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appropriate cases by the Commissioner or an officer
authorized by him in this behalf.
(7) In the case of perishable goods suspected of
infringing intellectual property rights, the period of
suspension of release shall be three working days which
may be extended by another four days subject to the
satisfaction of the Commissioner or the officer
authorized by him in this behalf that such extension
shall not affect the goods.
(8) Notwithstanding anything contained in these
Rules, in the case of suspension of clearance of
perishable goods on the basis of notice of the right
holder or his authorized representative, the right holder
or his authorized representative shall join the
proceedings as required under these Rules within three
working days or the extended period as provided in
sub-rule (7) and in case of suspension of clearance of
perishable good by the Deputy Commissioner of
Customs or Assistant Commissioner of Customs, as the
case may be, on his own initiative, the right holder shall
give notice, execute a bond and join the proceedings as
required under these Rules within three working days
or the extended period as provided in sub-rule (7), as
the case may be, failing which the goods shall be
released.
(9) If within ten working days or the extended period
under sub-rule (6), as the case may be, and within
three working days or the extended period as provided
in sub-rule (7) of this rule in the case of perishable
goods, the right-holder or his authorized representative
joins the proceedings, the Deputy Commissioner of
Customs or Assistant Commissioner of Customs , as the
case may be, having reasons to believe that the goods
are goods infringing intellectual property rights and
liable to confiscation under section 111 (d) of the
Customs Act, may seize the same under section 110 of
the Customs Act.
19. Rule 7(1) (a) deals with cases where the suspension of
clearance where the Deputy Commissioner or Assistant
Commissioner has reason to believe that the goods are infringing
IPRs and suspends clearance of the goods. Within 10 days of
suspension of the clearance, the Right holder has to join the
proceedings as per Rule 7(3). These provisions apply to cases there
is already a Right Holder who is registered with the Customs.
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20. Rule 7(1) (b) empowers the Deputy Commissioner or
Assistant Commissioner to suspend clearance on his own initiative;
thereafter, Rights holder has to give a notice under Rule 3 and
fulfill the obligations under Rule 5 within five days. Rules 3 and 5
deal with the procedure for registration of the IPR of the Rights
holder.
21. Thus, Rule 7(1)(b) deals with cases where the IPR has not
been registered with the Customs and in such a case, the Rights
holder has to give notice and fulfill obligations for registration
within five days. On the other hand, Rule 7(1)(a) deals with cases
where the Rights have already been registered with the Customs
and in cases of suspension of clearance, the Rights holders have to
join the proceedings within ten working days. In this case, the
clearance of the goods was suspended on receiving information
regarding some mis-declaration and on the request of the
appellant, the goods were warehoused and thereafter a Panchnama
was drawn after detailed examination which revealed that the
goods had also logos of popular brands. When the matter was
referred to the Deputy Commissioner (IPR cell), he confirmed that
the logos were registered with the Customs. Thereafter, the goods
were seized. As the seizure of the goods and suspension of the
clearance was based on the IPR already registered with the
Customs, it is covered under Rule 7(1)(a) and not under Rule
7(1)(b). Therefore, the assertion of the learned counsel that the
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clearance of the goods was suspended by the Deputy Commissioner
on his own initiative is not correct.
22. The next question is whether the Rights Holders have joined
the proceedings within the time set out in the Rules or not and
consequently have the proceedings been vitiated. On 5.3.2018
officers sent letters to Nike and Adidas and their representative
joined the proceedings the same day. On 6.3.2018 officers sent a
letter to PUMA and in reply, they sent a letter on 7.3.2018 and
joined the proceedings. Learned Counsel‟s submission is that they
have not executed a consignment specific bond with the Customs
within ten days. We find Rule 7(3) requires the Rights holders to
join the proceedings within 10 days. It does not require any bond
to be executed within 10 days. Once they join the proceedings,
they can examine the goods, take samples for detailed examination
and report back as to which of the goods have violate their IPRs
and why. The question of execution of a bond comes thereafter.
There is no requirement of execution of a consignment specific
bond within 10 days in Rule 7(3) and we cannot read into it words
which do not exist. We, therefore, find that the Rights Holders have
joined the proceedings within the time of ten days and the
proceedings are NOT vitiated on this ground.
23. The next question is whether the rejection of the declared
value of the impugned goods under section 14 and its re-
determination was correct. After examining the goods, the Customs
officers summoned the appellant. Shri Farooque, Director of the
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appellant appeared and gave a statement accepting that the goods
which were imported do not match with the description in the
documents. He also contacted his Chinese supplier and confirmed
that the goods were sent by mistake of labour at the suppliers‟ end.
Since the goods which were imported were different from those
which were declared in the Bill of Entry and in the invoice, the
question arose as to how to assess the value of the goods. Shri
Farooque suggested that a joint market survey be conducted to
determine the market price and the assessable value can be
deduced from it. On his suggestion, a joint market survey was
conducted by the Customs officers and Shri Farooque and the
market price of the imported goods was determined. From this
market price, 15% was deducted as the Retailer‟s margin and a
further 15% was deducted as the importer‟s margin. Another 5%
was deducted towards the post-importation costs which the
importer would have to incur. The price after these deductions was
reckoned as the cum-duty price and the assessable value was
calculated therefrom. We find no force in the argument of the
learned counsel that the transaction value should have been
accepted because:
a) According to the Director of the appellant Shri
Farooque, the goods which were imported were not the same
as were declared in the documents and they were sent by
mistake. Evidently, if the goods are different, the value
should be different too.
b) Shri Farooque himself suggested that the value can be
determined through a joint market survey and the
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department accepted the suggestion and thereafter he
participated in the survey.
c) Deductions have been made on account of retailer‟s
margin, importer‟s margin, post-importation costs from the
market price and what was left after these deductions was
taken as cum-duty price and the value calculated backwards.
d) There is nothing on record to show that Shri Farooque
gave the statement under duress.
e) After the entire exercise, another Director of the
appellant firm, Shri Rajeev Jaiswal gave in writing that he
fully understood the case and waived the requirement of SCN
and personal hearing and asked for an order.
f) Having accepted that the imported goods were different
from those in the documents and having confirmed from its
overseas supplier and clarified that the goods were sent by
mistake and having suggested that value may be determined
through a joint market survey and having participated in such
a survey and having never contested the value at the time of
adjudication, the appellant cannot now turn back and fault
the Revenue for accepting the appellant‟s own suggestion and
thereafter determining the assessable value of the goods
through a joint survey along with the appellant.
24. We, therefore, find no force in the submission of the
counsel that the invoice value should have been accepted as
the assessable value without re-determining through the
deductive method.
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Confiscation of goods under section 111(d), (l) & (m) of the
Customs Act
25. In the order of the original authority upheld by the impugned
order, goods other than the counterfeit goods were confiscated
under section 111(l) and (m) and the counterfeit goods were
confiscated under section 111(d) and (l) of the Act. This section
reads as follows:
SECTION 111. Confiscation of improperly
imported goods, etc. - The following goods brought
from a place outside India shall be liable to
confiscation: -
........
(d) any goods which are imported or attempted to be imported or are brought within the Indian customs waters for the purpose of being imported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;
.....
(l) any dutiable or prohibited goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under section 77;
....
(m) any goods which do not correspond in respect of value or in any other particular with the entry made under this Act or in the case of baggage with the declaration made under section 77 in respect thereof, or in the case of goods under transhipment, with the declaration for transhipment referred to in the proviso to sub-section (1) of section 54;
........
26. As far as the goods infringing the IPR (counterfeit goods) are concerned, once they are found to have violated the Rights of the rights holder, as per Rule 6, they become prohibited goods under section 11 of the Customs Act, 1962. Section 111(d) squarely applies to prohibited goods which are imported. It was also evident that these goods were not included in the entry made in the Bill of 32 C/52368/2019 Entry. In fact, Shri Farooque, Director of the appellant firm has, after checking with his overseas Chinese supplier, confirmed that the goods were not even ordered by them and were sent by mistake of the labourers. Therefore, confiscation of these goods under section 111(l) in the order of the original authority affirmed in the impugned order is correct and proper.
27. As regards the goods which were not found to infringe any IPR, the same were found to be of not the value which was declared. Their value was reassessed as per the suggestion of Shri Farooque, Director of the appellant firm through a joint market survey. Therefore, these goods were correctly confiscated under section 111(l) and (m).
Was the absolute confiscation of goods having men mark, horse mark and three strips is illegal, as these two marks were not registered with the customs but which also had the three stripes and "Trefoil" mark?
28. We find that the goods were not seized for having marks of Man and Horse but were confiscated for also having other marks such as Trefoil and three stripes and Puma written on the flaps. Learned Departmental Representative relied on the judgments of Delhi High Court in PUMA SE (supra) to assert that the Form Strip is the registered trade mark of PUMA. He relies on the judgment of Delhi High Court in the case of Adidas (supra) to assert that trefoil is the registered trade mark of Adidas. Learned counsel relies on the judgment of the General Court of EU to assert that three parallel lines in any direction are not the registered trade mark of Adidas. It is his assertion that unless the shoes also have Adidas 33 C/52368/2019 written on them, they have not violated the IPR. We find that the ratio of the judgment of the jurisdictional Delhi High Court is binding on this bench and the judgment of the General Court of EU is, at best, persuasive. We also find that under consideration in the judgment of the General Court of EU were, three vertical parallel lines as indicated in the judgment and under consideration was whether three equidistant parallel lines in any direction are the registered trade mark of Adidas. In the photographs of the shoes produced by parties before us, the three lines are not vertical lines but are at an angle as is well-known on the Adidas shoes. For these reasons, we are convinced that the judgment of the General Court of EU will apply to this case. So long as the IPR of another person are violated, it does not matter even if they contain some unregistered trade marks. We find in favour of the Revenue on this count.
Was imposition of redemption fine of Rs. 15,000/- under section 125(1) and penalty of Rs. 3,93,133/- upon the goods under section 114A of the Customs Act, 1962 correct?
29. The impugned order has upheld the order of the original authority whereby he confiscated goods (other than counterfeit goods) valued at Rs. 14,25,462/- under section 111(l) and (m) of the Customs Act and allowed their redemption on payment of a fine of Rs. 15,000/- which is about 1% of the value. Given the facts and circumstances of the case, we find this reasonable and find no reason to interfere with this redemption fine.
30. Penalty of Rs. 3,93,133/- has also been imposed under section 114A of the Customs Act and penalty of Rs.2,20,000/- has 34 C/52368/2019 been imposed under section 112. We find that these two sections are mutually exclusive by virtue of the fifth proviso to Section 114A which reads as follows:
SECTION 114A. Penalty for short-levy or non-levy of duty in certain cases. - Where the duty has not been levied or has been short-levied or the interest has not been charged or paid or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts, the person who is liable to pay the duty or interest, as the case may be, as determined under sub-section (8) of section 28 shall also be liable to pay a penalty equal to the duty or interest so determined:
......
Provided also that where any penalty has been levied under this section, no penalty shall be levied under section 112 or section 114.
31. Thus, imposition of both penalties is not sustainable. We, therefore, set aside the penalty imposed under section 114A of the Customs Act.
32. In view of the above, the appeal is partly allowed setting aside the penalty imposed under section 114A and upholding the remaining part of the impugned order.
(Order pronounced in court on 03/12/2021).
(JUSTICE DILIP GUPTA) PRESIDENT (P. VENKATA SUBBA RAO) MEMBER (TECHNICAL)