Custom, Excise & Service Tax Tribunal
M/S. Gagan Impex vs C.C.E Patparganj New Delhi on 6 October, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. IV
Appeal No. C/50389-50404/2016-CU(SM)
[Arising out of Order-in-Appeal No. CC(A)Cus/D-I/ICD/PPG/1056-1071/2015 dated 15.10.2015 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), New Delhi].
For approval and signature:
Hon'ble Ms. Archana Wadhwa, 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?
No
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
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. Gagan Impex .Applicants
Vs.
C.C.E Patparganj New Delhi .Respondent
Appearance:
Ms. Prabhjyoti K. Chadha, Advocate for the Applicants Shri H.C. Saini, DR for the Respondent CORAM:
Hon'ble Ms. Archana Wadhwa, Member (Judicial) Date of Hearing: 30.08.2016 Date of Pronouncement: 06.10.2016 FINAL ORDER NO. 54040-54055/2016-CU(SM) Per Archana Wadhwa:
All the appeals are being disposed of by a common order as they arise out of the same impugned order-in-appeal passed by Commissioner (A) and emanate from the same set of facts and circumstances.
2. As per facts on record the appellant filed bills of entry for the clearance of the goods declared as refurbished 17 inches data graphic display tubes for color with phosphor screen, pitch (17 inch), dot pitch less than 0.4 mm under CTH 85404020 attracting the duty @0% (BCD) plus 10%(CVD) plus 2%+1% (Edu. Cess) plus 4% (SAD). The goods were declared as refurbished Data Graphic Display tubes, therefore, the goods were examined in presence of Government approved Chartered Engineer.
3. The goods were examined by Custom Officers and by an independent Government approved Chartered Engineer. The Chartered Engineer after examining the goods declared them as refurbished / re-conditioned goods having a minimum residual life of more than 80% of the new data graphics tubes and estimated residual life of subject goods is about five years. The appellant had submitted NOC issued by the Director of Ministry of Environment and Forests for import of 1,50,000 nos. of refurbished data graphic display tubes, subject to the condition that the defective parts would be re-exported to the origin, but failed to produce the specific import authorization from DGFT in terms of Sl. No. I(a)(i) of para 2.17 of Foreign Trade Policy (2009-2014). No NIDB data of the contemporaneous import for the above said goods were available therefore value was enhanced slightly as per the opinion of Chartered Engineer in terms of Rule 4 to Rule 9 of CVR, 2007. The importer accepted the value so determined and waived the requirements of show cause notice and personal hearing.
3. The adjudicating authority passed the impugned orders in respect of above bills of entry holding that in terms of Sl. No. I9a)(i) of para 2.17 of Foreign Trade Policy 2009-2014, the import of second hand personal computers / laptops including their refurbished / reconditioned spares fails under restricted category, hence require special import authorization from DGFT therefore, confiscated the goods being restricted, under section 111 (d) of the Customs Act, 1962 and released them on payment of redemption fine and also imposed penalty on the appellant under Section 112(a)(i) of the Customs Act.
4. The appellant contested the above order on various grounds and specifically pleaded that in terms of para 2.17 of the Foreign Trade Policy clearly indicated that refurbished / reconditioned copy spares, photocopier machines / digital multifunction print and copying machines, air conditioners and diesel generating sets are specifically restricted by the policy but as per SL. No. 1(b) of the said table, refurbished / re-conditioned spares of Capital goods are allowed to be freely importable subject to the condition that such spares have at least 80% residual life of original spare; that para 2.3 of Chapter 2 of the Foreign Trade Policy 2012-13 titled Interpretation of Policy provides that (a) The decision of DGFT shall be final and binding on all matters relating to interpretation of policy, or provision in HBP VI, HBP V2 or classification of any item for import / export policy in the ITC (HC). In as much as in their case the Chartered Engineer has certified that the life of the goods is more than 5 years and the same are having residual life of more than 80% of the new parts certified the condition; that the clarification of the DGFT is very specific on the above issue and should be adopted.
5. However, the above pleas of the assessee were not found favorable and by observing that the tubes in question are similar in construction to television picture tube and the appellant have not produced any evidence or literature to substantiate their claim that the impugned goods are refurbished / re-conditioned of spares and capital goods. As such he observed that since on the 2.17 (a) restricts the goods being computer parts para 2.17 1(b) of the foreign trade policy will not apply as the computer monitors can be put to sale in the open market and cannot be considered to be capital goods. He also observed that as the goods are covered by Sl. No. 1110 of para B of the schedule - 3 to the Hazardous waste rules 2008 they require prior permission from Ministry of Environment and Forest read with Hazardous waste (Management, Handling and Trans-boundary movement) Rules 2008. He accordingly rejected the appeal.
6. After carefully considering the submissions made by both the sides, I find that as per para 2.17 of the Foreign Trade Policy 2009-2014 the second hand goods are importable, as detailed below:
Import Policy Conditions, if any
1. Second Hand Capital Goods
(a) Restricted Category:
(i) Personal Computers / Laptops
(ii) Photocopier Machines / digital multifunction print & copying machines
(iii) Air Conditioners
(iv) Diesel generating sets Restricted Allowed to be imported only as per provisions of FTP. ITC (HS), HBP v1, public notice or an authorization issued for import of the specified second hand item.
(b) (b) Free Category
(i) Refurbished / re-conditioned spares of capital goods Free Subject to conditions specified in para 2.33 of HBPv1
(ii) All other second hand capital goods Free II. All other second hand goods Restricted
7. As is seen from above, the refurbished / reconditioned spares of capital goods are freely importable subject to the condition specified in para 2.33 of handbook of Procedures volume 1. As per the said condition, the second hand refurbished / reconditioned spare of capital goods other than those personal computer / personal laptops are freely importable on production of Chartered Engineer certificate that such spares have at least 80% of the residual life of the original spare. Admittedly such a certificate is available on record and there is no dispute about the same.
8. The appellants have also drawn my attention to the circular number 27/2011-Cus dated 04.07.2011 issued by the Central Board of Excise and Customs. On going through the same, it is seen that the goods mentioned against the items at Sl. No. B1110 of the Schedule 3 relating to waste electrical or electronic assembly can be imported with permission from Ministry of Environment and Forest. Admittedly, such permission stands granted by the Ministry of Environment and Forest, vide their certificate dated 17.06.2013. As such the lower authorities could not adopt reasoning for holding the imports to be restricted.
9. In view of the foregoing I set aside the impugned order and allow all the appeals with consequential relief to the appellant.
[Order Pronounced in the open Court on 06.10.2016] (Archana Wadhwa) Member (Judicial) Bhanu 2 C/50389-50404/2016-CU(SM)