Custom, Excise & Service Tax Tribunal
M/S Vulcan Components India Pvt. Ltd vs Commissioner Customs, Jnch, Nhava ... on 25 April, 2012
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. IV Appeal No. C/1220/12 (Arising out of Order-in-Appeal No. 621(Gr-II/H-K)2012/JNCH/IMP-552 dated 5.11.2012 passed by the Commissioner of Customs (Appeals), JNCH, Nhava Sheva). For approval and signature: Honble Shri Anil Choudhary, Member (Judicial) ======================================================
1. Whether Press Reporters may be allowed to see : No 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 : Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair copy : Seen of the order? 4. Whether order is to be circulated to the Departmental : Yes authorities? ====================================================== M/s Vulcan Components India Pvt. Ltd. Appellant Vs. Commissioner Customs, JNCH, Nhava Sheva Respondents Appearance: Shri K.O. George, Director for Appellant Shri M.S. Reddy, Dy. Commissioner (AR) for Respondent CORAM: SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL) Date of Hearing: 25.04.2013 Date of Decision: 25.04.2013 ORDER NO. Per: Shri Anil Choudhary
The appellant, M/s Vulcan Components India Pvt. Ltd., a SSI unit, is engaged in the manufacture of components in which rubber is being used as one of the main ingredients. Further, the appellant exports almost 90% of the production. The appellant imports semi processed rubber (lump form, semi solid) for its own consumption in the manufacturing of finished products. This practice has been going on for several years in the normal course of business. The appellant filed a Bill of Entry No. 3947565 dated 4.7.2011 for clearance of import of goods declared as Rubber Compound PCU. The Bill of Entry is supported by invoice No. CBC 110519dAB dated 19.5.2011. The declared assessable value was Rs.11,20,225/-. The Bill of Entry was assessed on first check basis and on examination, Shed Superintendent has given report as under: -
Inspected lot opened and examined 10% after selection. Checked description and quantity, marks, weight, RSS forwarded to IRMRA for test. Verified GATT declaration. CO not found on goods. The Revenue on the assumption that, as per Section 139 of the Trade Marks Act, 1999, mentioning the Country of Origin on the goods imported is mandatory. Since the appellant/importer had not mentioned Country of Origin on the goods, the goods appeared liable to confiscation under Section 111(d) of the Customs Act, 1962 and the importer was liable for penalty under Section 112(1) of the Customs Act, 1962. Importer vide letter dated 28.7.2011 requested for waiver of show-cause notice and grant of personal hearing.
2. Pursuant to personal hearing granted to the appellant, the adjudicating authority found that the importer had not declared the Country of Origin on the goods, which is mandatory under Section 139 of the Trade Marks Act, 1999, at the time of filing of subject Bill of Entry. This fact has not been disputed by the importer. Therefore, a case of mis-declaration of the goods is made out and the goods are liable for confiscation under Section 111(d) of the Customs Act and also holding the appellant liable for penalty under Section 112(a) of the Customs Act for the error and or omission and accordingly the goods were ordered to be confiscated in terms of Section 111(d) with an option to redeem the same on payment of a redemption fine of Rs.2 lakhs and also penalty of Rs.50,000/- was imposed under Section 112(a) of the Customs Act.
3. Being aggrieved, the appellant moved before the Commissioner (Appeals) raising the grounds that: -
(i) Rubber component being semi processed in bulk and or lump form cannot be affixed with trade marks on the goods. Further, no condition has been imposed by Notification as required under Section 139 of the Trade Marks Act, 1999. Hence, there is no violation of the provisions of the Trade Marks Act, 1999 reads with the provisions of the Customs Act.
(ii) There is no case of mis-declaration made out, as regards the description of the imported goods or the applicable rate of duty, hence, there is no loss of revenue.
(iii) Further, Country of Origin, i.e. USA, was explicitly mentioned in the Bill of Entry and the accompanied documents like invoices and certificate issued by the manufacturer/exporter.
(iv) Further, this practice of import in this fashion have been continuing for last several years and never any objection has been raised by the customs authority and similar is position with respect to further imports subsequent to the Bill of Entry in question.
(v) Further, there is also a violation of principle of natural justice, as no opportunity was given to the appellant in terms of Section 46 of Section 5 of the Customs Act, 1962 for filing the substituted Bill of Entry for home consumption. Therefore, being no element of fraud and collusion, the penalty is not imposable.
4. The learned Commissioner (Appeals) confirmed the order of the adjudicating authority dismissing the appeal by recording the finding that the appellant has failed to declare the country of origin on the goods as mandatory under Section 139 of the Trade Marks Act, 1999 without referring to any particular Notification issued by the Government in terms of Section 139 of the Trade Marks Act, 1999. It is relevant to quote sub-section (2) of Section 139 of the Trade Marks Act, 1999, which reads as under: -
(2) The notification may specify the manner in which such indication shall be applied that is to say, whether to goods themselves or in any other manner, and the times or occasions on which the presence of the indication shall be necessary, that is to say whether on importation only, or also at the time of sale, whether by wholesale or retail or both. Further, the learned Commissioner (Appeals) relied on the decision of the Tribunal in the case of Cenlub Industries Ltd. Vs. Commissioner of Customs, New Delhi- 2001 (132) ELT 206 (Tri-Del).
5. The learned Dy. Commissioner (AR) appearing for the Revenue reiterates the findings of the adjudicating authority and the Commissioner (Appeals).
6. Having considered the rival submissions, I find that the Revenue has not indicated either in Order-in-Original or in the Order-in-Appeal, the particular Notification under the provisions of the Trade Marks Act, 1999, which provides for marking of the imported rubber in lump form for industrial use. It is evident from the plain reading of Section 139(2) of the Trade Marks Act, 1999 which provides for very specific indication vide notification as to the manner in which such indication is to be applied or in any other manner in the times or occasions on which the presence of the indication shall be necessary, that is to say whether on importation only, or also at the time of sale, whether by wholesale or retail or both.
7. Further, I find that the decision relied upon by the Revenue in the case of Cenlub Industries Ltd. (supra) is distinguishable and not applicable in the facts of the present case. In Cenlub case, the goods in question were Caller ID (Telecom goods) imported from Taiwan. Further, there was issue of valuation and the goods were of the brand name CENLUB without indicating the country of manufacture. Further, I find that the Notification No. 1/1964-Cus dated 18.1.1964 relied upon by the Revenue says Notification under Section 117 of the Trade Marks and Merchandise Act, 1958 (equivalent to Section 139 of the Trade Marks Act, 1999) is applicable .
8. Thus, I find that there is no case of violation of the provisions of Trade Marks Act, 1999 has made out against the appellant and accordingly, the Order-in-Original dated 9.8.2001 and the Order-in-Appeal dated 5.11.2012 are set aside. The appellant will be entitled to refund of the redemption fine of Rs.2 lakhs and penalty of Rs.50,000/- deposited along with interest as per Rules.
9. Thus, the appeal is allowed with consequential relief.
(Pronounced in Court) (Anil Choudhary) Member (Judicial) Vks/ 6