Custom, Excise & Service Tax Tribunal
Ocean Sky Impex Pvt. Ltd. vs Cc Appeals-Sea Ch-Ii on 31 October, 2023
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
CHENNAI
REGIONAL BENCH - COURT NO. I
Customs Early Hearing Application No. 40391 of 2023
(on behalf of Appellant)
IN
Customs Appeal No. 40498 of 2023
(Arising out of Order-in-Appeal Seaport C.Cus. II No. 477/2023 dated 21.07.2023
passed by the Commissioner of Customs (Appeals-II), No. 60, Rajaji Salai, Custom
House, Chennai - 600 001)
M/s. Ocean Sky Impex Private Limited : Applicant/
No. 33/4, North Street, Venkatesh PU, Appellant
Ayanavaram, Chennai - 600 023
VERSUS
Commissioner of Customs : Respondent
No. 60, Rajaji Salai, Custom House, Chennai - 600 001 APPEARANCE:
Shri Prem Ranjan Kumar, Advocate for the Appellant Shri N. Satyanarayanan, Assistant Commissioner for the Respondent CORAM:
HON'BLE MR. P. DINESHA, MEMBER (JUDICIAL) HON'BLE MR. M. AJIT KUMAR, MEMBER (TECHNICAL) FINAL ORDER NO. 40966 / 2023 DATE OF HEARING: 26.10.2023 DATE OF DECISION: 31.10.2023 Order : [Per Hon'ble Mr. P. Dinesha] This application for early hearing is filed by the applicant namely, M/s. Ocean Sky Impex Private Limited, Ayanavaram, Chennai with a request for allowing its application for early hearing of the appeal filed by it against the impugned Order-in-Appeal 2 Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB No. Seaport C.Cus. II No. 477/2023 dated 21.07.2023.
2. Heard Shri Prem Ranjan Kumar, Ld. Advocate for the applicant. We find upon hearing, that the only prayer in the appeal is for provisional release of the seized goods and hence, we grant early hearing and with the consent of both the parties, we take up the appeal itself for final disposal.
3.1 It is the case of the appellant that they had placed an order for import of "Polyester Coated Fabric (Polymeric Compound)" from a China based company vide various commercial invoices, the details of which are as under: -
S. Commercial Date of Quantity Total invoice No Invoice No. invoice value
1. VC-2490 15.08.2022 241247.80 sqm. USD 28,349.74/-
@USD 0.12/sqm.
2. VC-2502 16.08.2022 422647.80 sqm. USD 50,717.74/-
@USD 0.12/sqm.
3. VC-2506 19.08.2022 423187.20 USD 50,782.46/-
@USD 0.12/sqm.
The above goods when reached the Indian coast, the following bills-of-entry were filed for clearance: -
S. No. Bill-of-Entry No. Date of filing
1. 2214121 29.08.2022
2. 2299510 04.09.2022
3. 2299525 04.09.2022 3 Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB 3.2 It appears that there was an investigation by the Directorate of Revenue Intelligence (DRI), who apparently examined the consignment drawing samples therefrom and forwarding the same for examination by Textiles Committee, Chennai. The said committee vide its report on various dates appears to have reported the imported goods as: -
(i)Dyed woven polyester fabric coated/laminated with Polyurethane,
(ii) Dyed/printed polyester fabric, and
(iii) Dyed polyester fabric coated/laminated with Polyurethane against the declared "Polyester Coated Fabric (Polymeric Compound)". With the above report, the declared classification of the appellant under CTH 5903 9090 was proposed to be classifiable under CTH 5407 6190 and CTH 5903 2090.
3.3 The said goods appeared to the Revenue to be attracting Anti Dumping Duty ('ADD' for short) and the same appears to have been proposed, in response to which, there is no dispute that the appellant had deposited an amount of Rs.2,37,86,402/- towards the same.
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Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB 3.4 Thereafter, it appears that the DRI seized the imported goods vide seizure memos dated 19.10.2022 and 18.11.2022 and the said goods were permitted to be warehoused in terms of Section 49 of the Customs Act, 1962.
3.5 It appears that the appellant pleaded before the authorities that it had only ordered for "Polyester Coated Fabric (Polymeric Compound)" and upon coming to know that a different product/goods had been exported by the supplier, they had immediately contacted the foreign supplier, in response to which their supplier appears to have accepted their mistake in wrong shipment and in turn, had requested the appellant to re-export the same back to them. 3.6 The appellant appears to have pleaded that on the request of their supplier, they sought for provisional release of the seized goods, for the purposes of re-export, vide their letter dated 19.04.2023. It also appears that the appellant brought to the notice of the officials as to the legal position for release of the seized goods as prescribed under Section 110(2) ibid., when no notice was issued under Section 124(a) to the person from whose possession the goods were seized.
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Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB 3.7 There being no response from the DRI/Department, it appears that the appellant approached the Hon'ble High Court of Judicature at Madras and the Hon'ble High Court appears to have directed the Department to decide the application dated 19.04.2023 filed by the appellant for provisional release, within a period of 10 days. 3.8 Consequently, the adjudicating authority has passed an Order dated 20.05.2023 rejecting the request for provisional release on the ground that the investigation was at crucial stage and under process and therefore any decision on re-export of the goods at that stage would jeopardize the investigation. 3.9 Seriously aggrieved by the said rejection, the appellant appears to have approached the Commissioner (Appeals), Custom House, Chennai.
4. The first appellate authority having considered the contentions of the appellant has, however, rejected the request for provisional release on the very same ground that the investigation was still under progress. The first appellate authority has recorded the pleadings in 32 paragraphs running to about 18 pages. He, however, has not countered the pleadings on law as well as facts urged by the appellant in the impugned order.
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Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB
5. The crux of the contentions of the appellant before us are as under: -
• No Notice under Section 124(a) ibid. having been issued, seizure of the goods was clearly without jurisdiction and illegal. • Investigation having been completed with the issuance of Show Cause Notice, the seized goods may not be required for investigation. • In any case, they had already deposited over Rs.2.37 crores which is sufficient to protect the interests of the Revenue.
• The foreign supplier having agreed to take back the goods, any delay in re-export would result in financial loss to the appellant.
6. Per contra, Shri N. Satyanarayan, Ld. Assistant Commissioner, supported the findings in the impugned order.
6. Heard both sides and perused the record. 7.1 It is not the case of the Revenue that the imported goods were either prohibited or forbidden or banned by any Foreign Trade Policies. Even if it is proved that it is a case of mis-declaration, the interest of the Revenue is always safeguarded by the undisputed fact of deposit of over Rs.2.37 crores by 7 Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB the appellant and in any case, there is no scope for re-valuation since the goods in question are not requested for clearance for home consumption, rather for re-export.
8.2 Undoubtedly, any delay in provisional release would only be detrimental to the financial interests of the assessee since it is the assessee who would be liable to pay warehousing charges, demurrages, etc., and there may also be a fear in the mind of the appellant as to rejection by the foreign supplier in case of delay in re-export. The pleading of the appellant as to the acceptance by the foreign supplier on the wrong shipment as well as taking back the goods in question clearly shows the bona fides of the appellant, which are not at all doubted anywhere by the authorities below.
9. In view of the foregoing, we do not find any justifiable case made out by the authorities for not permitting the bona fide request for re-export of the seized goods and hence, we set aside the impugned order. Further, we also direct the adjudicating authority to accede to the request for provisional release of the seized goods forthwith after taking suitable bond and Bank Guarantee.
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Appln. No. C/EH/40391/2023 In Appeal No.: C/40498/2023-DB
10. The appeal is disposed of on the above terms.
(Order pronounced in the open court on 31.10.2023) Sd/- Sd/-
(M. AJIT KUMAR) (P. DINESHA) MEMBER (TECHNICAL) MEMBER (JUDICIAL) Sdd