Custom, Excise & Service Tax Tribunal
Commissioner Of Customs, Chennai vs M/S. Himachal Exim on 17 January, 2017
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
C/Misc./40315/2015 and C/40345/2015
(Arising out of Order-in-Appeal C. Cus. II No. 3/2014 dated 24.10.2014 passed by the Commissioner of Customs (Appeals - II), Chennai)
Commissioner of Customs, Chennai Appellant
Vs.
M/s. Himachal Exim Respondent
Appearance Shri K. Veerabhadra Reddy, JC (AR) for the Appellant Shri B. Satish Sundar, Advoate for the Respondent CORAM Honble Shri Justice (Dr.) Satish Chandra, President Honble Shri Madhu Mohan Damodhar, Technical Member Date of Hearing / Decision: 17.01.2017 Final Order No. 40062 / 2017 Per Justice (Dr.) Satish Chandra The present appeal is filed against Order-in-Appeal No.3/2014 dated 24.10.2014.
2. The brief facts of the case are that:-
M/s. Himachal Exim filed two bills of entry viz. 8960783 and 8960784 both dated 7.1.2013 declaring the goods as toys; shoes of various sizes with brand names NIKE &ADIDAS and glimmer stick/ eye liner for eyes / lips (assorted).
In respect of the eye liners/ eye brow pencils the lower adjudicating authority has held that the classification by the appellants under CTH 96099090 under the self assessment is not right and that CTH 33042000 under which the CVD is leviable on MRP basis, is appropriate. It was also found that a part of the consignment. viz. 5760 pieces of eye liners were branded and o Germany origin whereas the appellants declared them to be of Chinese origin. The LAA rejected the declared value of the goods due to the mis declaration and redetermined the value at Rs.86,630/- in terms of Rule 9 of the Customs Valuation Rules, 2007 . The CVD was quantified on the basis of the Maximum Retail Price The eye brow pencils totally valued at Rs.2,37,136/- were confiscated under Section 111 (m) of the Customs Act, 1962 and allowed redemption under Section 125 of the Customs Act, 1962 on payment of redemption fine of Rs.1 lakh. The LAA has stated that the appellant has accepted the value.
Regarding the Shoes, the Shri Nagaraj (Importer) was summoned and he has given a voluntary statement admitting that the shoes imported by him were duplicate and not original. The impugned order has stated that M/s. Adidas have joined the Customs proceedings under provisions of Intellectual Property Rights (Imported goods) Enforcement Rules, 2007 and have submitted a bond for Rs.4,62,303/- and a bank guarantee for Rs.1,15,576/-. It is seen that M/s. Nike did not join the proceedings nor has fulfilled the conditions of registration as provided under Rule 5 of the IPR Enforcement Rules, 2007. The LAA has held that in the case of Adidas brand, there will be a concurrent application of Notification No. 47/2007- Cus NT dated 8.5.2007 and Notification No. 51/2010 Cus. NT since they have joined the proceedings and in the case of Nike brand the Notification No. 51/2010 Cus NT dated 30.6.2010 shall apply independently. Based on that the LAA has held that all the shoes bearing Adidas brand and Nike Brand totally valued at Rs.13,52,785/- are prohibited and has confiscated them under Section 111 (d) (111 (i) and 111 (m) of the Customs Act, 19962. Regarding the shoes bearing Adidas brand valued at Rs. 7,00541/- the LAA has ordered for its disposal as per the provision of Rule 11 of the IPR Enforcement Rule, 2007. He has allowed redemption of shoes bearing the brand name Nike valued at Rs. 6,52,243/- under Section 125 of the Customs Act, 19962 on a payment of a fine of Rs. 2,00,000/-. Penalties of Rs. 5 lakhs and Rs. 2,50,000/- were imposed on the appellants under Section 112 (a) of the Customs Act, 1926 and Section 114AA of the Customs Act, 1962 respectively.
3. The above order was challenged by the importer before the Commissioner (Appeals) and the same was set aside by the Commissioner (Appeals) in appeal. Being aggrieved, the department has filed the present appeal.
4. With this background, we have heard learned Authorized Representative Shri K. Veerabhadra Reddy and learned counsel Shri B. Satish Sundar for the parties.
5. After hearing both sides and on perusal of the records, it appears that the respondent assessee had imported shoes declaring it to be Adidas and Nike vide Bill of Entry No. 8960783 dated 7.1.2013 and Bill of Entry No. 8960784 dated 7.1.2013. The goods were examined by officers of SIIB on 17.1.2013 and 18.1.2013. The goods on examination under the Bill of Entry No. 8960783 dated 7.1.2013 were found to contain toys and shoes with brand name Nike and Adidas. The goods under Bill of Entry No. 8960784 dated 7.1.2013 were examined on 181.2013 and were found to contain toys and shoes with brand name Nike and Adidas. Moreover, this consignment also contained cosmetics like glimmer sticks for eyes, eye liner pencils, eye liner pens etc.
6. The matter had reached to the Honble High Court of Madras in W.P. No. 32237 of 2014 filed by respondent herein. Honble High Court vide its order dated. 3.2.2015 observed as follows:-
It is not in dispute that the order has become final and no further appeal has been filed against the said order by the department. Since the order has become final, the respondents are directed to release the goods covered under Bills of Entry No. 8960783 and 8960784 both dated 7.1.2013 in terms of the order of Commissioner (Appeals II) Chennai vide Order in Appeal in C.Cus. II No.3/2014 dated 24.10.2014, within a period of four weeks from the date of receipt of copy of this order. The writ petition is ordered accordingly. No costs. The connected miscellaneous petition is closed.
7. Against this order, department preferred Review Petition No. 58/2015 and the respondent herein also preferred a Contempt Petition No. 844/2015 in the same matter. Vide a common order dated 8.10.2015, both the petitions were disposed by the Honble High Court inter alia with the following directions:-
13. As regards the review, though there is no apparent error on record since the order does not suffer from any infirmity, however, taking note of the fact that it has been passed solely with the observation that there was no appeal preferred by the department on the date of the order under review and there by the impugned order has become final, which as rightly contended by the learned counsel for the customs department, is virtually misconceived and cannot be sustained. Further, it is to be noted that even the statute has prescribed time limit for preferring the appeal, which admittedly, is available to the customs department till 17/02/2015, however, the order under review has been passed as if the order impugned in the writ petition has become final since there was no appeal by that time, which is factually incorrect and further, the period prescribed for filing appeal in the statute is still available to the customs department. It is to be noted that on several occasions, taking note of the fact that the writ petitions are pending without exhausting the appeal remedy, this court has passed orders directing the Tribunal to consider the appeal even after expiry of appeal time without insisting upon limitation aspect. But the issue in these matters is different, where the appeal time is still available to the customs department, which this Court cannot curtail the same and prevent the customs department to agitate the matter before the appellate authority.
14. In view of the above discussion and also considering the fact that as on date, the statutory appeal preferred by the customs department as against the order impugned in the writ petition, is pending before the Tribunal and the matter requires to be disposed of on merits, this court feels it appropriate to pass the following:
15. The parties are directed to participate in the appeal proceedings pending before the Tribunal and workout their remedy. The Tribunal is directed to dispose of the appeal as expeditiously as possible after affording opportunity to both sides.
8. From the record it also appears that goods are alleged to have been imported in violation of section 111(d), (i) and (m) of Customs Act, 1962 and prohibited for import under section 11 of Customs Act, 1962. But the fact remains that the proceedings in this case was declared illegal, null and void by the first appellate authority finding that the adjudication proceedings have not fulfilled the requirements of Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007. Confiscation and penalties were vacated by Commissioner (Appeals) and the goods were allowed to be released. We find no reason to interfere to the impugned order passed by the Commissioner (Appeals). The same is upheld.
9. In the result, appeal filed by Revenue is dismissed and the miscellaneous application praying for stay also gets dismissed.
(Dictated and pronounced in open court)
(Madhu Mohan Damodhar) (Justice (Dr.) Satish Chandra)
Technical Member President
Rex
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