Madras High Court
M/S.Mass The Tonner Shop vs The Commissioner Of Customs on 10 November, 2017
Author: T.S.Sivagnanam
Bench: T.S.Sivagnanam
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 10.11.2017
CORAM
THE HONOURABLE Mr. JUSTICE T.S.SIVAGNANAM
W.P.Nos.18797 and 18798 of 2010
and M.P.Nos.1 and 1 of 2010
M/s.Mass The Tonner Shop,
5, Aziz Mulk, First Street,
Thousand Lights, Chennai - 600 006
Rep. by its Proprietor Mr.Elamurugu .. Petitioner in
W.P.No.18797 of 2010
M/s.Unitech Enterprises,
88, Rana Pratap Market,
Karol Bagh, New Delhi - 110 005
Rep. by its Proprietor Mr.Suresh Kumar .. Petitioner in
W.P.No.18798 of 2010
..Vs..
1.The Commissioner of Customs,
Sea Port (Exports)
Custom House, No.60, Rajaji Salai,
Chennai - 600 001.
2.The Additional Commissioner of Customs (Group-7B)
Custom House, No.60, Rajaji Salai,
Chennai - 600 001.
3.The Director General of Foreign Trade &
Ex-Office Additional Secretary to the
Government of India,
Ministry of Commerce & Industry,
Department of Commerce, New Delhi. .. Respondents
in both W.Ps.
Prayer in W.P.No.18797 of 2010: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Mandamus, directing the respondents 1 and 2 herein to permit the clearance of the 103 units of the second hand Digital Multifunction Print and Copying Machines imported vide Bill of Entry No.592546 dated 09.08.2010 under free as secondhand capital goods in terms of para 2.17 read with definition under para 9.12 of the Foreign Trade Policy of 2009-14 without imposing any restriction in the absence of any specific restriction in para 2.17 of the policy and 2.33 of the Handbook of procedures 2009-14 or any notification issued by the 3rd respondent restricting the import of the said goods under Section 5 read with Section 3(2) of the Foreign Trade (Development and Regulation) Act, 1992.
Prayer in W.P.No.18798 of 2010: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Mandamus, directing the respondents 1 and 2 herein to permit the clearance of the 103 units of the second hand Digital Multifunction Print and Copying Machines imported vide Bill of Entry No.592546 dated 09.08.2010 under free as secondhand capital goods in terms of para 2.17 read with definition under para 9.12 of the Foreign Trade Policy of 2009-14 without imposing any restriction in the absence of any specific restriction in para 2.17 of the policy and 2.33 of the Handbook of procedures 2009-14 or any notification issued by the 3rd respondent restricting the import of the said goods under Section 5 read with Section 3(2) of the Foreign Trade (Development and Regulation) Act, 1992.
For Petitioner in both W.Ps. : Mr.N.Viswanathan
For Respondents in both W.Ps.
R1 & R2 : Mr.A.P.Srinivas
Senior Panel Counsel
R3 : Mr.B.Rabu Manohar
COMMON ORDER
Heard Mr.N.Viswanathan, learned counsel appearing for the petitioners and Mr.A.P.Srinivas, learned Senior Panel Counsel appearing for the respondents 1 and 2 and Mr.B.Rabu Manohar, learned counsel appearing for the third respondent.
2.The petitioners have sought for a direction upon the respondents to permit clearance of second hand Digital Multifunction Print and Copying Machines without imposing any restrictions in the absence of any restriction in para 2.17 of the Foreign Trade Policy 2009-2014 and 2.33 of the Handbook of Procedures 2009-2014 or any notification issued by the third respondent restricting the import of goods under Section 5 r/w. 3(2) of the Foreign Trade (Development and Regulation) Act, 1992.
3.When the writ petitions were admitted, an interim order was granted permitting the provisional release of the impugned goods with the direction to the petitioners to pay 25% of the enhanced value apart from paying duty @ 14.71% on the enhanced value. On complying with the condition, goods were directed to be released. The petitioners have complied with the condition and the goods have been released. Thus, the prayer sought for in these writ petitions have been partially granted and what is required to be seen is whether the goods in question could be permitted to be cleared without any restriction as according to the petitioners, there is no such restriction in the Foreign Trade Policy or in the Handbook of Procedures 2009-2014.
3.The case of the petitioners is that in terms of DGFT Notification No.31/2005 dated 19.10.2005 amending para 2.17, there is no restriction for importing old and used digital multifunction print and copying machines and the goods are freely importable in terms of definition under para 9.12 of Foreign Trade Policy 2009-2010. The Department on the other hand would submit that the Notification No.31/05 permits import of second hand capital goods including refurbished/reconditioned and spares shall be allowed freely. However, second hand personal computers/laptops, photocopier machines, air conditioners and diesel generating sets will only be allowed against a license . The respondents seek to bring digital multifunction print and copying machines as a photocopier machine and a printer and license is required. It is further contended that in terms of Notification No.35 dated 28.02.2013, the Government amended para 2.17 of the Foreign Trade Policy that under the head second hand goods in the category of second hand capital goods, import of digital multifunction print and copying machine was permissible only against authorization.
4.In the light of the amendment to the notification which according to the respondents would have effect from the date of the original notification where goods are freely importable, in my considered view this need not be answered in these writ petitions as this requires adjudication into the factual position and certain other legal issues are also to be considered in the light of the stand taken by the revenue. The Hon'ble Division Bench in the case of Commissioner of Customs (Sea Port-Import), Chennai vs. City Office Equipments reported in (2016) 336 ELT 19 (Mad) considered the correctness of an interim order passed in a writ petition filed for a similar prayer. Before the Division Bench, the Revenue relied upon notification No.35 dated 28.02.2013 and other decisions and ultimately the appeal filed by the revenue against the interim order was dismissed upholding the order permitting the release of the goods with a direction to the importer to furnish a bond for the duty or penalty that may be imposable on adjudication and to furnish a reply to the show cause notice and participate in the consequential adjudication.
5.In my considered view, a similar direction can be issued in the present writ petitions as well. However, I find that even before issuance a show cause notice writ petitions have been filed. Therefore, there will be a direction to the respondents to issue a show cause notice to the petitioner permitting them to file their objections and if there is any duty or penalty imposable as proposed in the show cause notice, the petitioner shall furnish a personal bond for the said value and the adjudicating authority after hearing the parties in person passed a reasoned order on merits and in accordance with law. The petitioner is entitled to canvas all points including the applicability or otherwise of notification No.35 dated 28.02.2013.
T.S.SIVAGNANAM, J.
cse
6.With the above direction, the writ petitions stand disposed of. No costs. Consequently, connected miscellaneous petitions are closed.
10.11.2017 cse I ndex:Yes/No Internet:Yes/No Speaking/Non-speaking Order To
1.The Commissioner of Customs, Sea Port (Exports) Custom House, No.60, Rajaji Salai, Chennai - 600 001.
2.The Additional Commissioner of Customs, Sea Port (Imports) Custom House, No.60, Rajaji Salai, Chennai - 600 001.
3.The Director General of Foreign Trade & Ex-Office Additional Secretary to the Government of India, Ministry of Commerce & Industry, Department of Commerce, New Delhi.
W.P.Nos.18797 and 18798 of 2010 and M.P.Nos.1 and 1 of 2010