Custom, Excise & Service Tax Tribunal
N.V. Associates vs Commissioner Of Customs on 29 December, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: C/22271/2014-SM, C/22272/2014-SM, C/27629/2013-SM, C/28405/2013-SM, C/28406/2013-SM, C/28407/2013-SM [Arising out of Order-in-Original No. and date passed by the Commissioner of Customs, Cochin is given in the table below] Shivam International Basanta Bihar, Near Krishi Upaj, Mandi Backside Gate, Rajasthan, Sikar 332 001 Atul Automation Pvt. Ltd. 8, Bentinck Street, Kolkata 700 001 West Bengal Parag Enterprises 8, Amartala Street, 4th Floor, Room No. 408, Kolkata, West Bengal 700 029 Sweta Mishra M/s. Sweta Logitech, Professor, New Barganda, Giridih, Jharkhand Shivam International 138, Utkalmonii Gopabandhu Sarani, Kolkata, West Bengal 700 007 N.V. Associates 1/A, Iswar Chowdhury Road, Kolkata, West Bengal 700 029 Appellant(s) Versus Commissioner of Customs Cochin Custom House Cochin 682 009 Respondent(s)
Appearance:
Shri P.A. Augustian, Advocate Faizel Chambers, Pullepady Cross Road, Cochin 682 018 For the Appellant(s) Shri Pakshi Rajan and Shri J. Harish, Shri Parashiva Murthy and Smt. Ezhil Mathi, AR For the Respondent(s) Date of Hearing: 07/12/2016 Date of Decision: 29/12/2016 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order Nos. 21505 - 21510/ 2016 Per: S.S GARG The appellants have filed these six appeals directed against the different Orders-in-Original passed by the Commissioner of Customs, Custom House, Cochin imposing redemption fine under Section 111(d) of the Customs Act, 1962 read with Section 3(3) of the Foreign Trade (Development and Regulation) Act, 1992 and imposing penalty under Section 112(a) of the Customs Act, 1962. Since in all the six appeals though the Orders-in-Original are passed on different dates but the issue involved is identical and therefore all the six appeals are being disposed of by this common order. The particulars of different orders and the amount involved and the redemption fine and the personal penalty are given below in the following table:
Sl. No. Appeal No. Order-in-Original No. Redemption Fine (Rs.) Penalty (Rs.) 1 C/22271/2014 COC-CUSTM-000-COM-007-14-15 dated 01.05.2014 13,00,000/- 6,00,000/-
2 C/22272/2014 COC-CUSTM-000-COM-001-14-15 dated 01.04.2014 18,00,000/- 10,00,000/-
3 C/27629/2013 13/2013 dated 29.05.2013 7,50,000/- 4,00,000/-
4 C/28405/2013 COC-CUSTM-000-COM-019-12-13 dated 29.08.2013 10,00,000/- 5,00,000/-
5 C/28406/2013 COC-CUSTM-000-COM-020-12-13 dated 13.08.2013 12,00,000/- 6,00,000/-
6 C/28407/2013 COC-CUSTM-000-COM-022-12-13 dated 18.09.2013 15,00,000/- 8,00,000/-
For the sake of convenience, the facts of Appeal No.C/22271/2014 is taken. The appellant is a Merchant Importer and had entered into a contract for supply of used Digital Multifunction Machines with overseas suppliers in August 2012. Immediately on getting confirmation regarding uninterrupted supply, the appellant approached Ministry of Environment and Forest and as per the permission letter dated 24.05.2013, the appellant was allowed to import the goods. In August 2013 onwards appellant started importing consignments of old and used Digital Multifunction Printers/Devices with Accessories and Attachment in terms of provisions contained in paragraph 2.17 of Foreign Trade Policy 2009-2014 which came into effect from 05.06.2012 and in terms of provisions contained in paragraph 2.33 of the Hand Book of Procedures Vol-I, which clearly allows free imports of secondhand Digital Multifunction Print and Copying Machines in the category of Secondhand Capital Goods. In October 2013, the appellant through his clearing agent filed Bill of Entry No. 5124219 dated 07.04.2014 for clearance of 391 numbers of Digital Multifunction Printers with all relevant import documents. The consignment was examined in the presence of chartered engineer and on examination goods were found as per declaration. The assessable value on the basis of Chartered Engineers certificate worked out to be Rs. 74,35,217/- (Rupees Seventy Four Lakhs Thirty Five Thousand Two Hundred and Seventeen only). The appellant vide letter dated 17.07.2013 accepted the value of Rs. 74,35,217/- (Rupees Seventy Four Lakhs Thirty Five Thousand Two Hundred and Seventeen only) as per Chartered Engineers valuation. During the hearing before the Commissioner, appellant submitted that the import of used Digital Multifunction Print and Copying Machines started before the date of amendment of Foreign Trade Policy and the amendment is not applicable in the present imports. But the learned Commissioner did not consider the submissions and vide the impugned order allowed the appellant to redeem the goods on payment of fine of Rs. 13,00,000/- (Rupees Thirteen Lakhs only) and on payment of duty at the rate applicable. Penalty of Rs. 6,00,000/- (Rupees Six Lakhs only) was also imposed under Section 112(a) of the Customs Act, 1962. The appellant paid the Customs Duty, fine and penalty and thereafter challenged the same before this Tribunal.
2. Heard both the parties and perused the records.
3. Learned counsel for the appellant submitted that the impugned order imposing very heavy redemption fine and penalty is not sustainable in law as the learned Commissioner has failed to consider that all the imports involved in all these appeals started prior to the amendment in the Foreign Trade Policy and therefore the amendment is not applicable in these appeals because before the amendment these Digital Multifunction Print and Copying Machines were freely importable under Secondhand Capital Goods category. He further submitted that the Hand Book of Procedures in paragraph 2.33 laid down that import of secondhand capital goods except those of personal computer/laptops shall be freely allowed subject to conditions reproduced in the Policy. He further submitted that while placing the personal computer/laptop under the restricted category, it is laid down that Photocopier/Digital Multifunction Print and Copying Machines can be freely imported subject to the conditions laid down in para 2.33 of the said Hand Book of Procedures. He further cited the provisions of paragraph 2.17 of the previous Foreign Trade Policy wherein the goods were freely importable upto 28.02.2013 and also the judgment of the Madurai Bench of the Honble High Court of Chennai. The importer has also admitted that on issuance of DGFT Notification and Public Notice dated 28.02.2013, the items have become restricted for import and that w.e.f. that date imports of used MFP required licence from the DGFT.
4. On the other hand the learned AR strongly defended the impugned order and submitted that the impugned order is perfectly in accordance with law because of the imports involved in the present appeals have been effected after the amendment in the Foreign Trade Policy which was effected by Notification No. 35 and Public Notice No. 50 on 28.02.2013. He further submitted that after the amendment, the disputed items become restricted and could not have been imported without prior licence from the DGFT which in the present case the appellant did not have. He further submitted that the law is well settled to the effect that the date of shipment is the date of receipt of goods on Board as mentioned in the master Bill of Lading and in all the appeals, there is no dispute that the date of shipment is after 28.02.2013.
5. After considering the submissions of both the parties, I find that after the amendment in the Foreign Trade Policy effected by DGFT Notification No. 35 and the Public Notice No. 50 on 28.02.2013, all the items viz. Digital Multifunction Print and Copying Machines have become restricted for import and from that date, import of these machines required licence from the DGFT which was not taken by the appellant. Therefore, the appellants have violated the provisions of Foreign Trade Policy and the Commissioner vide the impugned order has rightly passed the order of confiscation and thereafter given an option to redeem the goods on payment of fine of Rs. 13,00,000/- (Rupees Thirteen Lakhs only) under Section 125 of the Customs Act 1962 and also imposed penalty of Rs. 6,00,000/- (Rupees Six Lakhs only) under Section 112(a) of the Customs Act, 1962. The argument of the learned counsel for the appellant that the redemption fine and the penalty is on a higher side and it should be reduced does not have any force in view of the fact that there is a clear-cut violation of the Policy in importing the subject items. The Commissioner (Appeals) has considered all the evidence on record and the judgments cited by the counsel for the appellant and has come to a right conclusion and in my view, the redemption fine and the penalty imposed by the Commissioner is not excessive and does not warrant any interference by this Tribunal. Therefore, I am of the view that there is no infirmity in the impugned order and I upheld all the impugned orders and consequently dismiss the appeals of the appellants.
(Order was pronounced in Open Court on 29/12/2016) (S.S GARG) JUDICIAL MEMBER iss