Custom, Excise & Service Tax Tribunal
Regal Impex vs C.C., Icd, Tkd, New Delhi on 5 August, 2015
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No.2, R.K.Puram, New Delhi COURT-III Date of hearing/decision: 5.8.2015 Customs Appeal No.222 of 2010 Arising out of the order in appeal No.CCA/ICD/15/10 dated 24.2.2010 passed by the Commissioner of Customs (Appeals), New Delhi. For approval and signature: Honble Mr. R.K. Singh, Technical Member Honble Ms. Sulekha Beevi C.S., Judicial Member 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982? 2 Whether it should be released under Rule 26 of 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? 4 Whether Order is to be circulated to the Departmental authorities? Regal Impex .. Appellant Vs. C.C., ICD, TKD, New Delhi . Respondent
Appearance:
Present Shri A.L. Mehta, Consultnt for appellant Present Shri B.B. Sharma, A.R.. for the respondent Coram: Honble Mr. R.K. Singh, Technical Member Honble Ms. Sulekha Beevi C.S., Judicial Member Final Order No.52559/2015 Per R.K. Singh:
This appeal has been filed against the Order-in-Appeal dated 24.2.2010 which upheld the Order-in-Original dated 16.11.2009, in terms of which redemption fine of Rs.10 lakhs was imposed in lieu of confiscation and for allowing re-export and penalty of Rs.5 lakh was also imposed.
2. The facts of the case are that appellant filed two Bills of Entry for clearance of goods declared as LDPE. On examination, the goods were found to be Polypropylene (PP) granules. Immediately thereafter appellant took up the matter with the supplier , Basell International Trading FZE, Dubai which accepted the mistake of sending wrong goods and agreed to take them back bearing all the costs incurred in that regard. The primary adjudicating authority having regard to the submission of the appellant confiscated the goods with an option to redeem the goods for re-export on payment of redemption fine and also imposed penalty as above. The Commissioner (Appeals) upheld the order of the primary adjudicating authority.
3. In its appeal before CESTAT, the appellant has strenuously argued that (i) orders for the goods were placed on 20.7.2009 (ii) the price of LDPE was higher than the price of PP (iii) part payment for the goods was sent prior to shipment of the goods (iv) payment was made by the appellant against documents through Bank and when the mistake was pointed out to the suppliers, they reimbursed the payment made with regard to the goods through the bank. (v) There are several judgments to the effect that in case of wrong supply by the supplier without any mens rea on the part of the appellant no fine or penalty was imposable for allowing re-export. (vi) Anti-Dumping duty on PP was imposed much after the orders for supply of LDPE were placed and the appellant could not have foreseen the likelihood of the imposition of the anti-dumping duty on PP. (vii) Ld. Advocate for the appellant referred to the judgment of Honble Supreme Court in the case of C.C.E., Patna vs. Usha Martin Industries 1997 (94) ELT 460 (SC) to advanc the proposition that the CBEC Circulars are binding on the departmental authorities but not on the assessees
4. Ld. A.R. for Revenue on the other hand contended that (i) it was a case based on information (ii) the goods were found mis-declared (iii) the whole exercise seems to have been done for the purpose of avoiding anti-dumping duty on PP. It also cited in the case of C.C., Tuticorin vs. Sripathi Papers and Boards Pvt. Ltd. 2014 (313) ELT 664 (Tri-Chennai) and Authentic Impex vs. C.C. (General), Mumbai 2015 (318) ELT 305 (Tri-Mumbai) to support its proposition that redemption fine and penalty can be imposed in these circumstances..
5. We have considered the contentions of both sides and perused the relevant records. It is evident that the orders for 49.5 MT + 49.5 MT of LDPE were placed on 20.7.2009 and part payment was also made in advance. There is evidence of confirmation of receipt of those orders by the supplier on 20.7.2009 itself. The supplier in this case is a well established multi-national on M/s Basell International Trading FZE. It is also seen that the documents relating to the import goods were released by the bank after receiving the balance amount from the appellant. It is also an admitted fact that when the appellant took up the matter with the supplier immediately on coming to know that goods imported were different from the goods ordered, the supplier immediately confessed to the mistake having been made and returned the money through bank and also agreed to bear the expenses with regard to re-export of thee goods. The contention of the Revenue that whole exercise might have been to avoid anti-dumping duty on PP imposed vide Notification No.82/2009 dated 30.7.2009 devoid of any basis and is pure conjecture because there was no way the appellant could predict the imposition of anti-dumping duty after placement of orders. Also, even in a case where anti-dumping duty is imposed after the orders for supply of goods are placed but before their import the importer can legitimately request for re-export on the ground that the import has become economically unviable due to anti dumping duty. Further it has been mentioned in the primary adjudication order that LDPE was more expensive than PP and therefore, it appeals to reason that the appellant would not collude for getting the supply of cheaper goods while paying for more expensive goods. Indeed we find that primary adjudicating authority after taking into account the facts and circumstances of the case has stated that since the goods so found are not as per the order placed by the importer, I allow the said goods to re-export. It is obvious from this observation of the primary adjudicating authority that no foul play was suspected, let alone established, by him. Indeed, the facts and circumstances of the case clearly point towards the absence of any mala fide on the part of the appellants We find that that CESTAT in similar circumstances has held repeatedly that for allowing re-export, RF and penalties are not warranted as is evident from the following judgments:
(a) Simens Public Communication Networks Ltd. v. C.C. (Airport) Calcutta 2001 (137) ELT 623 (Tri-Kolkata)
(b) Guru Ispat Ltd. vs. C.C (Port), Calcutta 2003 (151) ELT 384 (Tri-Kolkata).
) HCL Comnet Systems & Services Ltd. v. C.C., New Delhi - 2003 (158) ELT 349 (Tri-Del.) Our attention was also drawn to the Circular of the Board No.100/2003 dated 28.11.2003 wherein the CBEC has observed that in case of wrong shipments where no mala fide is suspected re-export may be allowed on payment of a nominal penalty or without penalty. The judgment of CESTAT in the case of Authentic Impex vs. C.C. (General), Mumbai (supra) cited by the ld. A.R. for Revenue is related to the import of goods which required import licence and therefore has no applicability with regard to the present case. In the case of Sripathi papers and Boards Pvt. Ltd. (supra) cited by the ld. A.R., the goodss were found to be hazardous and there was no indication that the supplier had admitted to any mistake on its part and even there CESTAT only stated that such goods could also be liable to confiscation and redemption fine.
6. In the light of the analyses above, we are of the view that there is no reasonable ground for imposition of fine and penalty as a condition for re-export of the goods and therefore we set aside the impugned order and allow re-export of the impugned goods without any fine and penalty. The appeal is thus allowed.
(R.K. Singh) Technical Member (Sulekha Beevi C.S.) Judicial Member scd/ 1