cestat ruling

CESTAT RULING

2012-TIOL-1969-CESTAT-MUM

IDMC Ltd Vs CC (Dated : June 29, 2012)

Cus - Refund - Furnishing of cash security equal to 2% of the CIF value of the goods sought to imported under Project Import - refund claimed of security deposit after finalization of assessment is not hit by unjust enrichment - Appeal allowed with consequential relief: CESTAT [para 5]

Also see analysis of the Order

2012-TIOL-1968-CESTAT-BANG

Mr T V Shajahan Vs CC (Dated : June 20, 2012)

Customs – Smuggling – The appellants attempted to export Indian currencies out of India illegally – Appellant No.2 was using specially made suitcases for concealing currency for the purpose of illegal export - Initially statements of all three appellants indicate that they have done this type of operations on more than one occasion -Appellant No.2 stated that he has made a profit of Rs. 2,00,000/- on each occasion -The claim that the currency was received through legal channel for business purposes is not convincing - If that be so, the money could have been returned legally - Prima facie, the appellants are involved in the attempted smuggling – Ordered for pre-deposit (Para 5, 6 & 7).

2012-TIOL-1960-CESTAT-DEL

M/s PEE AAR Exim Vs CC (Dated : May 31, 2012)

Customs - Export - Over-valuation - Drawback - DEPB - Market Enquiry of Export value - Evidentiary value - Investigation by the department did not prove that the garments were not manufactured by the exporter. No proper enquiry done regarding the market price of the garments with other manufacturers. Exporters claim that when value cap is fixed under DEPB, no market enquiry is required regarding market value of the goods remains undisturbed by the Department. Hence, the value declared by the exporter for the export goods is allowed. (Para 14, 15 & 16)


CC & CE Vs Keerthi Kumar Jain (Dated : June 01, 2012)

Customs – Seizure of Gold - Respondents 2 & 3 carried 44 gold bars of 100 grams each and gold mound weighing about 481.52 grams and small piece totally weighing 15.08 grams, (totally 4896.60 grams) of respondent No.1 and the same was seized –Original authority released 44 gold bars on production of documents but absolutely confiscated the remaining gold – The Commissioner (Appeals) set aside the order of confiscation of the gold Held that : Section 123 of the Customs Act cannot be invoked to the facts of the present case - It was incumbent on the department to rely on evidence to show the illicit nature of the seized gold mound and pieces of gold - There is no such evidence adduced by the department - It appears that no verification has been conducted with the prospective dealers by the revenue – Since the documents given in respect of substantial quantity of the seized gold (44 bars) produced by Respondent-1 stands accepted by the department, the acceptance of the evidence by the Commissioner (Appeals) in respect of the balance quantity of 499.500 gms. of gold calls for no interference (Para 6.3 & 6.4)


CC & CE Vs Mr Vishwanatham Paluru (Dated : June 01, 2012)

Customs – Penalty – Penalty under Section 112 (a) of the Customs Act, 1962 –Adjudicating authority imposed penalty of Rs.500/- under Section 112 (a) ibid –Revenue filed appeal for enhancement of penalty - Considering the nature of dispute and the stakes involved it is not appropriate for the department to have carried an appeal against the order of the original authority to the Commissioner (Appeals) and then to the Tribunal as well (Para 5).


Shri Charles Patrick Vs CC (Dated : November 30, 2012)

Appellant out of business since year 2005 - Employee appointed for the purpose of receiving government communications failed to inform appellant regarding hearing date as he was not paid salary - Appeals restored on payment of cost: CESTAT [paras 4 & 5]

2012-TIOL-1937-CESTAT-KOL

Shri Ajay Tamang Vs CC (Dated : February 23, 2012)

Customs - Import - Smuggling - Confiscation - Penalty - Stay / Dispensation of pre-deposit - The persons who booked and dealt with the consignment have not made out a prima facie case that they were not involved in smuggling of goods viz., cigarettes, animal hides etc. 25% of penalty ordered as pre-deposit. However, complete waiver of penalty granted in case of the consignees. (Para 5.1.1, 5.1.2 & 5.1.3)


CC Vs M/s Millipore India Ltd (Dated : June 18, 2012)

Customs – Refund – Refund of Special Additional Duty leviable under Section 3(5) of the Customs Tariff Act, 1975 - Barring a specimen copy of sale invoice, the relevant invoices covering sales of all the imported goods within the prescribed time limit have not been produced by the respondent - The Chartered Accountant's certificate is apparently based on his examination of "books and records maintained by the company in the normal course of business, the self declaration given by the company and other relevant records of the company as appropriate" - There is no mention, in this certificate, of any of the sale invoices - The identity of "other relevant records of the company" is not discernible from this certificate - This certificate does not even specify the particulars of the imported goods so as to establish a correlation - There are many more short comings to be found in this document - Suffice to say that the appellant is fully justified in contending that the learned Commissioner (Appeals) erred in relying on the Chartered Accountant's certificate - The appellant has rightly contended that the respondent did not comply with one of the conditions of the exemption notification inasmuch as they did not prove that all the imported goods were sold within the prescribed period under invoices containing endorsement of inadmissibility of CENVAT credit of SAD to the buyers - Set aside the impugned order - Appeal allowed by way of remand (Para 4 & %).


Shri Jagdish V Gursahani Vs CC (Dated : December 13, 2012)

Revenue representative informing that order could not be passed within 30 days as per directions of the Bench as the post of Commissioner of Customs (Adjudication) is lying vacant - Chief Commissioner of Customs, Mumbai directed to get the adjudicating authority appointed for this purpose and get the matter adjudicated within a period of one month & report compliance on 15 th January, 2013: CESTAT [para 3]



CC Vs Jagdish V Gursahani (Dated : October 30, 2012)

Revenue seeking extension of time for adjudicating the case which was ordered to be done within a period of 90 days – keeping in mind that the issue pertains to the year 1989, adjudicating authority directed to dispose of the matter within 30 days failing which appropriate action will be taken against him: CESTAT [para 3]


CC Vs Jagdish V Gursahani (Dated : October 30, 2012)

Respondent's name is incorporated as Commissioner of Customs (Adjudication), Mumbai – covering letter mentioning respondent's name as Commissioner of Customs (CSI Airport), Mumbai – no mistake in order – ROM application by Revenue dismissed: CESTAT [para 3]

2012-TIOL-1916-CESTAT-MAD

Regional Manager, Central Warehousing Corporation Vs CC (Dated : August 22, 2012)

Customs – Penalty under Section 117 imposed on the appellant, who is functioning as CFS, for sub-letting some of the area – Under Section 45 (2) (b), there is no restriction on the appellants not to sublet the premises - The only restriction is that the appellants shall not permit the goods to be removed from the Customs area without the permission of the proper officer - There is no allegation against the appellants that they have removed the goods without the permission of the proper officer - Therefore, they have not violated the provisions of Section 45 (2) (b) as alleged in the impugned order.


M/s Posco India Delhi Steel Processing Centre Pvt Ltd Vs CC (Dated : September 29, 2012)

Cus - Refund of Additional duty - Amending notification 93/2008-Cus has not been implemented retrospectively - time limit of one year is not applicable in the case of refund claim filed against the duty paid prior to 1.8.2008 - Rejection of refund claim on the ground of time bar is not sustainable - appeal allowed with consequential relief: CESTAT [para 4]



CC Vs M/s Best Mega International (Dated : August 9, 2012)

Customs – Used digital multi-functional print and copying machines - Remand power of Commissioner (Appeals) - Appeal filed on the ground that Commissioner (Appeals) has no power to remand - Commissioner (Appeals) has actually set aside the Order-in-Original, but not remanded the case – Goods have already been released to the respondents - Revenue appeal is infructuous.


M/s Hypercity Retails (India) Ltd Vs CC (Dated : August 9, 2012)

Cus - Applicant purchased Advance Licence and imported goods - it is the case of the Revenue that M/s Rajat Pharmachem from whom applicant had purchased DEPB licence had procured the same by producing false documents - applicant saddled with penalty - there is nothing on record to show that applicant had knowledge or link to the fraud committed - strong prima facie case in favour - Pre-deposit waived and stay granted: CESTAT


CC Vs M/s Avenue Impex (Dated : September 27, 2012)

Customs – Remission of duty of goods destroyed in fire - Revenue seeks to deny remission on the ground that fire took place after out of charge was given – There is a distinction between 'an order for clearance for home consumption' and 'clearance for home consumption'- Assessee is entitled for remission of duty. Dual benefit of insurance claim and remission - If the goods are insured, it does not disentitle the assessees from the claim of remission of duty.


CC Vs M/s Leela Scottish Lace Pvt Ltd (Dated : July 20, 2012)

Central Excise - Refund -Refund of accumulated CENVAT credit on account of exports in terms of Notification No.5/2006 CE(NT) dated 14.03.2006 issued under Rule 5 of CENVAT Credit Rules, 2004 - Original Authority sanctioned refund except credit taken on service tax on CHA services on the ground that the said bills of CHA contained their Mumbai Head Office and no Input Service distribution invoice produced -Commissioner (A) allowed appeal without dealing the issue on which refund was rejected - Held that : As the Commissioner (Appeals) has not dealt with the ground on which the original authority had rejected the claim, and on the unanimous request of the both sides, set aside the impugned order and remanded the matter to the Commissioner (Appeals) for fresh consideration (Para 4).


CCE Vs M/s Sti India Ltd (Dated : May 31, 2012)

100% EOU – Import of HSD Oil and filed into Bond Bill of Entry by claiming exemption under Notification No.52/2003-Customs for warehousing it in 100% EOU – Issued SCN on the ground that Notification 52/03-Cus does not provide exemption from Additional Duty payable under Section 116 of the Finance Act, 1999 - It is fairly clear that imported dutiable goods can be deposited in a warehouse and there appears to be no need for an exemption notification to authorize such deposit in the bonded warehouse of a 100 % EOU – Followed the Larger Bench decision in the case of Paras Fab International (2010-TIOL-963-CESTAT-DEL-LB) – Imported goods warehoused in premises of a 100% EOU and used for purpose of manufacturing in bond as authorized under Sec 65 of Customs Act cannot be treated to have been 'removed for home consumption' (Para 6).


M/s Esys Information Technologies Pvt Ltd Vs CC (Dated : August 29, 2012)

Import of microprocessors intended for retail sale - goods are pre-packed and are required to be affixed with MRP as per DGFT notification 44 (RE-2000) - prima facie benefit of nil rate of Additional Customs duty in terms of notfn. 29/2010-Cus cannot be denied on the ground that the importer is claiming benefit of notfn. 6/2006-CE -Pre-deposit waived of 16.93 Crores and stay granted: CESTAT [paras 3 & 4]



M/s National Aluminium Company Ltd Vs CC (Dated : June 14, 2012)

Customs - Import - Valuation - Import of Equipment - Inclusion of System designing and Engineering Charges - Admittedly, the goods in question were imported in 1985 and 1986 when the Customs Valuation Rules 1963 were in force - The original authority and the appellate authority invoked Rule 9(1)(b)(iv) of the Customs Valuation Rules 1988 which were not invoked in the show cause notice - Obviously a gross error of law was committed by both the authorities - The issue which ought to have been considered by these authorities was whether the design and engineering charges paid by NALCO to FCB was liable to be included in the assessable value of the imported goods under the Customs Valuation Rules 1963 which were in force during the period of imports - Set aside the impugned orders and allowed the appeal by way of remand (Para 4).


M/s KCPJ International Agency Vs CC, Visakhapatnam (Dated : June 11, 2012)

Customs – CHA Licence – Suspension of CHA Licence by the Commissioner based on a report of DRI, which alleged involvement of CHA in a fraudulent export - No notice was served on CHA to contemplate inquiry under Regulation 22 of the Customs House Agents Licensing Regulations, 2004, though a period of 10 months lapsed - Held that : The period of 90 days mentioned in the respondent's report is the outer limit for taking action under Regulation 22 - It is unfortunate that an inquiry is still being contemplated against the CHA for over 10 months - By no stretch of imagination can any prudent man say that such contemplation of action against the CHA for an indefinite period is in keeping with the principles of natural justice or with the spirit of the legal provisions – Ordered to dispose the matter by 17.8.2012 else the suspension automatically stands set aside (Para 4 & 5).


CC Vs M/s Gimpex Ltd (Dated : August 6, 2012)

Customs – Export – Demand of export duty - Export of Iron Ore – Respondent exported iron ore on payment of export duty @ Rs.50/- per MT by availing the benefit of Notification No.62/2007-Cus. - Testing of sample reported to have contained 62.1 % of Fe by weight - Assessment was finalized on the basis of test report without grant of the benefit of aforesaid Notification and issued SCN demanding differential duty -Duplicate sample of the goods was sent to the Central Revenues Control Laboratory (CRCL) for re-testing for iron content - The CRCL's report showed Fe content to be 59.4% - Based on CRCL Report, Commissioner dropped the demand – Held that: There is no merit in the grounds of the appeal of Revenue - The issuance of SCN under Section 28 cannot be questioned on the ground that the finalized assessment of the shipping bill should have been first revised under Section 130 - The tenor of the appeal is not in keeping with the appellant's own stance in cases of this nature - The issuance of SCN under Section 28 was in order and the order passed in adjudication thereof by the Commissioner is also in order (Para 2).


Shri Vagata Vijayaraghavan Pardhsarathy Vs CC (Dated : July 4, 2012)

Customs - Import - Valuation - Import of Smart Cards and Cards from the parent company - Loading of value of 35.67% - The statements of Ex-Finance Controller and Ex-Director of the company clearly confirm the manipulation and misrepresentation -Hence, loading is, prima facie, justified - There is no justification to waive pre-deposit of the balance of Customs duty demanded from the assessee - Ordered for pre-deposit of Duty of Rs.2 Crores (Para 5.2 & 6).


M/s P S Tech Com Pvt Ltd Vs CC (Dated : July 20, 2012)

Customs – Refund – Limitation - Short receipt of Imported Goods – Imported 1000 units of Heat Detectors on 30.8.2006 and cleared under RMS on payment of duty -CHA noticed that the number of heat conductors in the package was 100 as against 1000 units and sought for refund of duty paid relating to 900 units vide letter dated 6.9.2006 - The department vide letter dated 13.10.2006 informed the importer to file a claim in proper format - Importer filed claim on 28.7.2007 - Original authority as well as appellate authority rejected claim – Held that : It is not in dispute that the original authority has accepted the short landing of imported goods - In the peculiar facts and circumstances, the CHA who has been duly authorised by the importer has sought for refund vide letter dated 6.9.2006 - This fact is not in dispute -Nevertheless, in the facts of the present case, it would be in the interest of justice to treat the letter dated 06.9.2006 as refund claim - After all, the whole amount had been deposited but the related goods have undisputedly not arrived in India (Para 6.1, 6.2 6.3 & 7).



CC Vs M/s Dell International Services India Pvt Ltd (Dated : July 2, 2012)

Customs – Import – Eligibility of – Exemption under Entry Sl. No.10 of Notification No.140/91-Customs dated 22.10.1991 for ‘Fire Detection and Quenching System' as 'Security System' - The imported equipments are very much used for protection of property and human beings, inasmuch as they are undisputedly used in detection of fire and extinguishing the fire as and when it breaks out – No merit in the Revenue Appeal (Para 4 & 5).


M/s National Steel And Agro Industries Ltd Vs CC (Dated : November 1 2012)

Cus - Commissioner of Customs (Export Promotion) is subordinate to the CESTAT in judicial matters – what the Commissioner has done is to reconsider an issue which has already been settled in favour of the appellant in the previous proceedings and which is not permissible – Order not sustainable in law hence set aside and appeal allowed: CESTAT [paras 2, 3 & 4]



Shri Subhash Muljimal Gandhi Vs CC (Dated : October 10, 2012)

Contempt of Court - Appellant making allegation that Bench is favouring Revenue in absence of any evidence - SCN issued for initiation of contempt proceedings not replied by appellant despite grant of several opportunities - appellant seeking exemption from personal appearance and submitting that decision be taken and communicated - since appellant has nothing to say in reply to SCN, matter to be referred to Bombay High Court for proceedings of contempt against appellant: CESTAT [ para 2 ]

2012-TIOL-1805-CESTAT-AHM

CC Vs M/s Gujarat Ambuja Cement Ltd (Dated : May 30, 2012)

Customs - Import - Furnace Oil - Determination of quantity based on density -Demand of differential duty - The importer paid duty based on Bill of Lading, Invoice value and Ullage report where the quantity was expressed in MT. Revenue recalculated the quantity based on density of the Furnace oil and demanded

differential duty. HELD - Duty liability for the goods imported will depend upon the invoice value at the time of importation of the goods, irrespective of their being shortage of quantity or otherwise. (Para 7)


M/s Atlantic Shipping Pvt Ltd Vs CC (Dated : September 21, 2012)

Customs - Refund of Penalty - Unjust Enrichment - Welfare Fund - The factual finding of collection of the penalty, by the assessee from their customers is not in dispute. Sanctioning of refund claim will doubly enrich the assessee, which is not in consonance with the law. (Para 8)


Voith Turbo Pvt Ltd Vs CC (Dated : August 7, 2012)

Customs - Valuation - Applicant is a subsidiary company of a German company and imports goods which are further traded and supplied to Indian Railway - Revenue demanding duty on the sale price of traded goods in India on the ground that importer and supplier are related persons - since duty is being demanded without taking into consideration the profit margin, applicant has made out a prima facie strong case for waiver of pre-deposit of the adjudged dues: CESTAT [para 7]


Amba Expo Fab Vs CC (Dated : June 6, 2012)

Cus - Deciding DRI case without being assigned to adjudicate - SCN was assigned to Commissioner of Customs (Adjudication) to adjudicate who issued notice for personal hearing but did not adjudicate - later in 2009 the appointment was withdrawn -Commissioner of Customs (Imports), Nhava Sheva passing o-in-o adjudicating the case by recording that he has got powers vide notfn. 112/2005 dated 28.05.2005 -nowhere in this notification it is mentioned that the SCN was assigned to CC(I), Nhava Sheva - order passed is without jurisdiction - prayer made by AR for remanding the matter to the adjudicating authority cannot be accepted as no adjudicating authority appointed - Order set aside and appeals allowed: CESTAT [paras 6 & 8]


M/s Bhaktiprem International Vs CC (Dated : November 8, 2012)

Restoration of Stay application - Appellant caught by Railway Police for travelling in a non-entitled class and hence could not appear before CESTAT on the day of hearing –appellant seems to be a habitual offender so far as pursuing proceedings not only before Tribunal but also before other judicial forums – Cost imposed of Rs.5000/- for

restoration of Stay application: CESTAT [paras 1 & 2]


M/s Posco India Delhi Steel Processing Ltd Vs CC (Dated : June 13, 2012)

Customs - Import - Refund of Special Additional Duty (SAD) - Process carried out on imported goods - Refund of SAD rejected as the importer had undertaken further working/processing on the imported goods before the goods are sold. The importer had undertaken cutting and slitting of the coils imported by them before they are sold. Also, classification of the goods imported is different from the classification of the goods sold. HELD - It is a settled law that, while considering whether the process amounts to manufacture is whether a new article with distinct name, character and use has emerged or not and not whether the tariff heading has changed. Therefore, just because after cutting and slitting, the tariff heading changes we can not say that the products do not remain the same. Importer eligible for refund of SAD.Also, the domestic manufacturing-importer can take cenvat credit of SAD whereas the importer who sells the goods as such does not get the benefit of credit and therefore is given refund. When the process does not amount to manufacture and no excise duty is leviable SAD credit is not available. The intention of the government at the time of the introduction of the Notification seems to be to give refund of SAD paid for the goods subsequently sold. On this account also the appellant is eligible for refund. However, matter remanded to the original authority to verify if the goods imported and sold are the same. (Para 14 & 18)



M/s Kumar's Cotex Ltd Vs CC (Dated : June 13, 2012)

Customs - 100% EOU - Demand - Appellants imported Autoconers (Capital Goods) under 100% EOU scheme without payment of duty in June 1996 - The apital goods were put into use and as two of them developed problems in 2002 got Development Commissioner's permission to dispose in the DTA as scrap or to destroy them - The goods were dismantled in the presence of Superintendent of CE and subsequently sold as scrap on payment of Central Excise duty equal to Customs duty - Department issued SCN after seizure of goods alleging that duty was short paid by depreciating the value of the machinery for a longer period than the period from the date of commencement of commercial production to the date of payment of duty - Appellants contended the calculation of department stating that the additional duty of Customs was ‘NIL' at S.No.251 of Notification No.21/2002 Cus dt 1.3.2002 and SAD was not payable as this duty was not leviable on the date of import - it was also contended on the grounds of limitation- Held : I t is not in dispute that the machinery was dismantled under the supervision of the Central Excise Range officers and cleared from the factory as scrap - It should be considered to be a DTA clearance by the EOU attracting Central Excise duty - It was not clearance of the capital goods as such from the factory - Hence, payment of Central Excise duty by the assessee at the time of clearance of the scrap cannot be faulted - The Department has no case that there was short-payment of this duty by the assessee. (Paras 6). 100% EOU - Limitation - The entire demand is beyond the normal period of limitation

- No valid case of suppression or wilful misstatement of facts, let alone fraud, with intent to evade payment of duty has been made out against the assessee by the Revenue - As a matter of fact, no such finding has been recorded in the impugned order - Entire demand is also barred by limitation (Para 7). 100% EOU - Penalty - there can be no penalty on the assessee or co-appellants under the Customs Act in relation to clearance of goods on payment of excise duty under the provisions of the Central Excise Act (Para 6).


CC Vs M/s LGC Promochem India Pvt Ltd (Dated : July 13, 2012)

Customs - Refund - Chromatography parts imported by the respondent through post were assessed to Customs duty on merits - Respondents filed a refund claim with a request to re-assess the goods by allowing the benefit under Notification No. 25/2005-Cus dated 1.3.2005 - Refund rejected by the department on the ground that the original postal assessment order was not challenged - The Commissioner (Appeals) held that the appellant could not have challenged the assessment based on the postal receipt without knowing the details of the assessment and that the decision of Priya Blue Industries (2004-TIOL-78-SC-CUS) relied upon by the original authority is not relevant to the facts of the case - Held that : Grounds of appeal do not indicate any reason as to why the reasoning adopted by the Commissioner (Appeals) not applying the decision in Priya Blue Industries case is wrong and department failed to produce any evidence of opportunity provided during assessment - No valid reason found to interfere with Commissioner (A) order (Para 7 & 8).


M/s Aluminium Industries Ltd (AIL) Vs CC, CE & ST (Dated : June 25, 2012)

Customs - Advance Licences - Duty Demand - Exports were made in proportion to imports and export proceeds were realized in foreign exchange - Shipping Bills filed for "drawback shipping bills" instead of "DEEC shipping bills" - Held that : Though the shipping bills were filed as drawback shipping bills, the assessee did not press any claim of drawback and no drawback was sanctioned either - Claim under DEEC scheme was pursued - the assessee exported their final products and realized proceeds in foreign exchange - It is not in dispute that they discharged a major part of their export obligation under the DEEC scheme - They could not produce proof of this in the form of EODCs because the customs authorities did not make the necessary entries in the DEEC book citing technical reasons - It is not the case of the department that the assessee was fraudulently claiming DEEC benefit - The extent to which the export obligation was discharged by the assessee is a fact, by now, clearly known to the customs authorities - Copies of the relevant shipping bills must be available in the department - The only reason stated for demand from the assessee is absence of proof of discharge of export obligation - The circumstances in which the assessee could not produce EODCs - In these facts and circumstances, the appropriate authority in the department should, in a fair play, give the assessee what is due to them on the basis of the available documents - Ordered for re-quantification of demand of duty by the Commissioner - penalties on the assessee and their Senior Manger cannot be sustained and the same are set aside (Para 5 & 6).


Mangilipalli Pradeep Ramu Vs CC (Dated : June 28, 2012)

Customs - Import - Cars - Conditions of Import Policy - Confiscation - Redemption Fine - Penalty - The cars have not been imported from the country of manufacture and is in violation of Import Policy conditions. Proving the path of the goods imported is not sufficient compliance with the policy. It is not for Tribunal to look into the merits and demerits of the import policy because the Tribunal does not have before it all the facts and constraints that result in a policy. Homologation Certificate and Type Approval Certificate are not produced by the importer. The GOI had not notified the International Accredited Agency in USA which should have issued such certificates. As there was no such agency in USA the importer cannot be asked to submit the Type Approval certificate/COP from the said agency and meet impossible conditions. Redemption fine and penalty reduced. Alternative View : Evidence on record show that the vehicles were originally shipped from USA and reached India via Dubai and Thailand. As such, the export of the vehicles originated from 'country of manufacture' and the same have undergone transhipment and is sufficient compliance of the Import Policy. The Policy Condition nowhere uses the expression "directly", i.e., directly imported from the country of manufacture. It is not permissible to introduce the expression "directly" in the said condition so as to read the same as "be imported directly from the country of manufacture". When two interpretations are possible, one beneficial to the assessee has to be adopted. Confiscation of vehicles set aside. In view of difference of opinion matter referred to Third Member for resolution. (Para 15, 16 / 24 & 25)



Amiable Logistics (India) P Ltd Vs CC (Dated : October 9, 2012)

CHALR, 2004 - Stamp paper purchased by CHA in his name for execution of High Sea Sales agreement - allegation that since as per Stamp Act, stamp paper ought to have been purchased in the name of parties to the contract and hence they are fabricated and, therefore, this act is in violation of CHALR, 2004 is misplaced - the agreement was examined by the Customs officers who allowed clearance of the goods -moreover, High Sea Sales agreement have been executed prior to imports, therefore, proceedings under CHALR, 2004 cannot be initiated - further the CHA has nowhere stated that they were in the knowledge of the diversion of goods by the importer -appellant only arranging transportation and handing over goods to representative of the importer - allegation that appellant was actively involved in diversion of goods unsustainable - violation of Regulation 13(d), (e) and (n) of CHALR, 2004 is not sustainable - Order of revocation of CHA licence and forfeiture of security deposit set aside with immediate effect: CESTAT [paras 7, 8 & 9]



M/s Bata India Ltd Vs CC (Dated : June 06, 2012)

Customs - Stay/Dispensation of pre-deposit - Refund of Additional duty of Customs under Notification No 102/2007 Cus - Goods were sold on the basis of RSP/MRP -Chartered accountant certificate does not demonstrate how the impugned duty liability was not passed on to the buyers of the goods - Factual aspects flowing from the certificate relied upon by the appellant does not enable to draw any inference in favour of the appellants at the prima facie stage - Pre-deposit ordered.


Akanksha Syntex Pvt Ltd Vs CC (Dated : April 17, 2012)

Appeal is not maintainable before the CESTAT against an order passed under section 110A of the Customs Act, 1962 in respect of provisional release of seized goods: CESTAT by Majority Judicial propriety demands that the decision of the Division Bench is to be followed in preference over the decision of the Single Member which is passed without taking into consideration the earlier decision passed by the Division Bench.



Shivkumar S Dubey Vs CC (Dated : June 29, 2012)

Cus - Penalty - provisions of s. 111(d) of Customs Act, 1962 does not apply in respect of goods that are freely importable - charge of undervaluation u/s 111(m) is prima facie not sustainable as at the time of assessing bills of entry, the appraiser had loaded value by 15% on basis of NIBD data available on record at that time -applicant has made a prima facie case for waiver of penalty: CESTAT [paras 6 & 7]


A Saleh Mohamed & Co Vs CC (Dated : October 31, 2012)

Cus - No proof produced by the department to adduce that the Order in original was served on the appellant in the year 1999 - appellant submitting that he had left for Dubai in 1997 and returned only in 2003 and the o-in-o was received in the year 2011 after which they filed appeal - since order was passed ex parte matter remanded to adjudicating authority: CESTAT [paras 4 & 6]



CC Vs M/s Drive India Enterprise Solutions Ltd (Dated : June 11, 2012)

Customs - Refund claim - Jurisdiction - Refund claim filed before the Assistant Commissioner, Chennai Custom House while the import had taken place in Air Cargo, Chennai - No error in the order of the Commissioner (Appeals) transferring the refund claim to the dealing Assistant Commissioner in Air Cargo - Revenue appeal has no merit.


M/s Gennex Laboratories Ltd Vs CC (Dated : February 21, 2012)

Customs - Conversion of Free Shipping Bills into Export Promotion Scheme Shipping Bills - Followed the decision of Kiran Pondy Chems Ltd. (2006-TIOL-1388-CESTAT-MAD) - when documentary evidence contemplated under the proviso to Section 149 was in existence at the time of export conversion should have been considered –Ordered for conversion of Free Shipping Bills into Export Promotion Shipping Bills (Para 4).


M/s Kerala Minerals & Metals Ltd Vs CC (Dated : March 28, 2012)

Customs – Stay / Pre-deposit of Duty – Classification – Limitation - prima facie case for the appellant against the subject demand of duty on the ground of limitation - The text of the Section 28(1) of the Customs Act is clear - As far as Government is concerned, the period of limitation is one year and, for all others, it is six months - No reason to hold that the appellant are identical to the Government of Kerala – Pre-deposit waived (Para 3 & 4).


M/s Hindustan Petroleum Corpn Ltd Vs CCE (Dated : June 28, 2012)

Customs – Dispute between PSUs and Government – Appeal dismissed for want of clearance from the “Committee on Disputes” for filing appeal - Dismissal order was passed on 30.4.2008 - Right from December 2007 till 17.2.2011, the appellant apparently had been pursuing their application before the Committee on Disputes but unsuccessfully - In this scenario, Final Order dated 30.4.2008 insofar as it pertains to the present application must be intact - ROA application stands rejected (Para 2).


CC & CE Vs Edmark Trading Co Ltd (Dated : May 4, 2012)

Refund - Section 27A of the Customs Act covers interest on delayed refund of duty and nothing else – the said section nowhere provides for payment of interest on any other delayed payments such as fine or penalty – Tribunal being a creature of the statute cannot go beyond the same – there is prima facie merit for grant of stay of the operation of the order of the Commissioner(A) directing payment of interest - Stay application filed by Revenue allowed: CESTAT [paras 5.1 & 6]


M/s Balaji Steel Rolling Mills Pvt Ltd Vs CC (Dated : February 24, 2012)

Customs – Import – Import of HMS Scrap – Non–submission of pre-shipment certificate - According to the Foreign Trade Policy during the relevant time, pre-shipment certificate was essential for import of shredded heavy melting scrap - pre-shipment certificate was not produced - Having regard to the fact that the consignment was held up and the appellant has suffered heavy demurrage charges, a lenient view is called for – RF and Penalty amounts reduced (Para 4).


M/s Kongovi Electronics Pvt Ltd Vs CC (Dated : August 3, 2012)

Customs - Import - Import of Electrolytic Nickel Cathodes during the period August 2004 to March 2005 - Importer paid high rate of duty than payable - Filed refund application in 2009 - Refund rejected - Importer filed an application on 23.6.2010 under Section 149 for amendment of details in Bills of entry filed during the period August 2004 to March 2005 which request was rejected by the original authority -Commissioner (Appeals) also rejected appeal - Held : the appellants paid duty at higher rate than what was applicable, and they have woken up after several years and sought for refund in 2009 and did not succeed before the original authority and also before the Commissioner (Appeals) - Importer attempted to reopen the issue by invoking provisions under Section 149 - Section 149 gives discretionary power to Customs authorities for amending the documents in certain circumstances - This provision cannot be used to revive a time expired refund claim - No reason to interfere with the order of the Commissioner (Appeals) (Para 5 & 6).



M/s Binani Cement Ltd Vs CC(Dated : June 26, 2012)

Customs – Stay / Pre-deposit of Duty – Valuation - The imported goods did not conform to the specification agreed – Negotiations took place between the importer and supplier wherein, as a special case, the goods were agreed to be accepted subject to reduction in the price - Price negotiation or the specification of the consignment is not doubted by the Revenue – Followed the decision of Chaudhary Ship Breaker (2010-TIOL-86-SC-CUS) - price paid by an importer to seller in ordinary course of

commerce is to be taken as transaction value for purpose of valuation of goods - T here is no reason given in the show cause notice for doubting the negotiated price entered into by the importer with the supplier - The appellant made out a prima facie case for waiver of pre-deposit (Para 5).


Pankaj Kumar Tripathi Vs CC (Dated : May 7, 2012)

Customs - In the present day circumstances, particularly for the safety of passengers travelling by air, persons like appellants being in the security staff can do anything for a monetary consideration – appellants helping to smuggle foreign currency for a consideration of a few thousand rupees & mobile phones have rightly been imposed penalty u/s 114 of Customs Act, 1962 - Appeals dismissed: CESTAT [para 6]



Shri Himanshu Kotecha Vs CCE (Dated : June 27, 2012)

SEZ – Stay / Pre-deposit of Duty - Manufacture – The repacking and labeling which were part of the definition of Manufacture earlier under foreign trade policy, no longer find a place in the definition and unless repacking and labeling etc bring in a new product with distinct name, character, use and marketable product, the process cannot amount to manufacture - After considering the definition of Manufacture in Central Excise Act, SEZ Act and Foreign Trade Policy earlier, which was the subject matter of dispute, the question appears to be one of interpretation and it is possible to interpret differently - The Development Commissioner clarified that the process undertaken by the appellant even according to the revised definition, would amount to manufacture - The appellant has made out a prima facie case for holding that the extended period should not have been invoked in this case for confirming the demand (Para 4 & 5).


M/s BPL Ltd Vs CC (Dated : June 1, 2012)

Customs – Refund – Unjust Enrichment - The original authority in the de novo adjudication and the Commissioner (Appeals) in the impugned order held that the appellants have failed to adduce evidences to show that the duty burden was not passed on to the buyers - Undoubtedly the burden is on the assessee - Mere certificate by the Chartered Accountant without the relevant documents to corroborate the certificate is not conclusion enough to prove that the burden was not passed on to the buyers - No merit in the appeal (Para 4).


M/s Shree Renuka Sugars Ltd Vs CC (Dated : April 26, 2012)

Customs – Import – Import of Raw Cane Sugar under DFRC Scheme – Tampering of Test Report changing the Sucrose content in order to avail the benefit of DFRC Scheme - Office copy of the test report found in the customs laboratory, the report originally received by the Karwar Customs and the entry made in the sample register indicated the sucrose content as 98.1% - The internal reports maintained by the assessee-company indicated the sucrose content as 98.1% to 98.3% - All these taken together along with other circumstantial evidences, clearly prove that the entries in the lab report and the sample register were tampered with by overwriting to make them read as 98.9% - The manipulation of figures 98.1% to 98.3% was done with malafide intention and to benefit the assessee-company - Sucrose content of less than 98.5% in the imported ‘raw cane sugar' disentitle the goods to the benefit of Notification No.43/2002-Cus and 46/2002-Cus (Para 16 & 17). Customs – Import – Penalty - Import of Raw Cane Sugar under DFRC Scheme –Tampering of Test Report changing the Sucrose content in order to avail the benefit of DFRC Scheme - As held by the Commissioner, the investigation by DRI could not pin point the person who has manipulated/tampered the lab report and the sample register and the needle of suspicion is on several persons but the evidence is not sufficient to sustain penalties on any person other than the assessee-company - It is like a case where theft is confirmed but thief is not identified - On the basis of totality of evidences, the assessee-company, who is obviously the beneficiary of the manipulation, is clearly responsible for the manipulation (Para 17).


Shri Amitabh Bathla Vs CC (Dated : May 5, 2012)

Customs – Import – Undeclared Goods - Undisputedly 150 packages of elastic tapes were found and seized even though in the Bill of Entry, the said goods were not declared - The impugned goods have originated from China and transported via South Korea to Cochin in container - The Master Bill of Lading clearly indicated not only the goods which were declared but also 150 cartons of elastic tapes - House Bill of lading was obviously manipulated to omit the 150 cartoons of elastic tapes - Instead of satisfactorily explaining the presence of unaccounted goods, the appellants have pretended injured ignorance and have adopted aggressive postures and even sought for cross examination of about 40 persons without given any valid reasons for such request - The Commissioner's order in confiscating the undeclared goods treating it as a case of smuggling and also confiscating other goods as used for concealing call for no interference (Para 7). Customs – Import – Valuation - A grievance was made that the Commissioner has ignored the evidence relating to import of identical goods through Cochin at the rate of USD 2.88/kg without giving valid reasons - This submission is prima facie valid –Directed the Commissioner to consider afresh the valuation aspects and record cogent reasons for rejection of the declared value and also for considering the claim for comparable value (Para 8.2). Customs – Import – Valuation - In the order of the Commissioner of Customs (Preventive), though no duty is demanded under Section 28 of the Customs Act, duty and other dues are payable in terms of Section 125(2) of the Customs Act in the event of the appellants exercising the option to redeem the goods - Therefore, for determining the quantum of duty as well as quantum of redemption fine and penalty, the valuation of the consignment becomes relevant and the same has to be considered afresh by the Commissioner of Customs (Preventive) - After deciding the valuation aspects the Commissioner shall determine the quantum of redemption fine and penalty (Para 9).


M/s Bayer Extracts Pvt Ltd Vs CC (Dated : March 8, 2012)

100% EOU - Duty Demand - The challenge to the demand of duty on oleoresins cannot be sustained inasmuch as the evidence on record is in favour of the Revenue -The MD of the appellant company clearly admitted the procurement of crucial raw materials without bills, manufacture and sale of finished goods in local market in retail - He also admitted that no records or books of accounts were issued/maintained in relation to this activity - There was no valid retraction of the statements (Para 4.1). Central Excise – Statement – Retraction – Retraction i s not acceptable on account of the long gap between the dates of confessional statement and affidavit and also on account of the fact that it was not sworn to before the authority which recorded the confessional statement - Any clarificatory statement should have been given, without delay, to the authority which recorded the original statement - Moreover, there should not be any inconsistency between the original and ‘clarificatory' statements (Para 4.1). Central Excise – Duty demand - Goods Cleared to DTA from EOU without permission during the period prior to 11.5.2001- Followed the decision of NCC Blue Water Products Ltd. - (2010-TIOL-73-SC-CX) - Duty payable under Section 3(1) of Act and not under proviso - The impugned demand of duty was quantified under the proviso even for the period prior to 11.5.2001, which cannot be sustained - Demand of duty on goods cleared from EOU premises from April 1999 to 10.5.2001 requires to be re-quantified in terms of the main part of Section 3(1) (Para 4.2).


A Srinivasan Vs CC (Dated : September 3, 2012)

Cus - Applicant, a retired Supdt. of CE, imposed with a penalty of Rs.25 lakhs by adjudicating authority u/s 114(i) of the Customs Act, 1962 for giving a false certificateentitling the exporter an export benefit of Rs.4 crores – applicant pleading that he is receiving only provisional pension and has to look after unmarried daughters – prima facie not a case for total waiver, however, considering the facts and circumstances and financial hardship pleaded, pre-deposit ordered of Rs.50 thousand for obtaining Stay: CESTAT. [para 4]



M/s MMTC Ltd Vs CC (Dated : December 22, 2011)

Customs – Stay / Pre-deposit of duty – Target Plus Scheme – Broad nexus between the exported goods and imported goods – Denied benefit of exemption under Target Plus Scheme as there is no product-to-product nexus between the imported item and the exported goods - The Input-Output Norms referred to by the counsel indicate nexus between the imported item (Palmolein) and the exported goods (Rice, Wheat

etc.) which are within the same product group (viz. Food Products) - the condition sheet attached to the authorization letter issued by the DGFT to the appellant found mention of product group viz., Food products in for utilizing duty credit - Prima facie , the appellant has made out a case for waiver of pre-deposit (Para 4).


M/s Universal Biofuels Pvt Ltd Vs CC (Dated : May 1, 2012)

100% EOU – Stay / Pre-deposit of Duty – Demand - Obtained permission from the Development Commissioner for conversion from EOU Scheme to EPCG Scheme and paid applicable duties – Confirmation of duty demand of differential primarily on the ground that the appellants have failed to achieve NFE – Held that : Undisputedly the Development Commissioner gave in principle approval for switching over from the EOU scheme to EPCG scheme and the department has followed it up with a demand of about Rs 36 lakhs and substantial amount of the same stands paid - The submission of the advocate that in the event of their paying differential duty amounting to Rs 2.8 crores they shall be eligible for CENVAT credit of CVD amounting to about Rs 2 crores is prima facie valid - The appellants have claimed that they have made exports to the tune of Rs 47,00,00,000/- - it appears that the appellants have since made exports which is more than their obligation under the EPCG scheme – Pre-deposit waived (Para 5 & 6).


M/s New India Electricals Ltd Vs CC (Dated : December 29, 2011)

Customs– Stay / Pre-deposit of Duty – Import – Penalty - Import of SCOMET items for the purpose of export to Iran – In the opinion of the Atomic Energy Commission of India, the imported goods are covered by SCOMET list and the appellant-company and the Vice Present of the appellant-company, prima facie , have involved themselves in the dubious transaction of importing the impugned items with intent to export the same to Iran, which is not permissible – Hence some penalties, prima facie , are justifiable on the appellant-company and the Vice President of the appellant-company - Penalties on other appellants are, prima facie , not justified.


Ganesh Das Swami Vs CC (Dated : July 4, 2012)

Customs - Import - Smuggling - Burden of proof - Penalty - Confiscation of Vehicle -Redemption Fine - The owner of the vehicle, proprietor of the Carrier Company, employee of the Carrier Company and the Driver of the vehicle failed to disclose the origin of the goods or the owner of the goods. For no proof of consigner, the origin of goods was bound to held to be of foreign origin and liable to action under Customs Act, 1962. The four persons have not come out with clean hands and disclosed the owner of the goods, who they are bound to know. Penalty imposed on the four persons is appropriate. Considering the value of the vehicle, redemption fine is reduced. (Para 9)


Reliance Industries Ltd Vs CC (Dated : September 4, 2012)

Notfn. 97/2004-Cus - Import of ‘catalyst' as consumables - amending notfn. 72/2007-Cus omitting the term ‘consumables' from the benefit of exemption - in the FTP capital goods also include catalysts for initial charge and under EPCG scheme, for existing plant, catalysts are separately mentioned with spares - Catalysts and consumables are separately mentioned in para 5.1A of the FTP - as ‘catalysts' are separately mentioned in addition to consumables in the EPCG scheme for existing plant and also separately mentioned in the definition of capital goods under the Foreign Trade Policy, prima facie merit in contention of applicant on merit as well as time bar - Pre-deposit of Rs.49 crores waived and stay granted: CESTAT [para 10]



M/s U Prints Vs CC (Dated : March 27, 2012)

Customs – Stay / Pre-deposit of Duty – Classification - Duty demand is on materials described by the appellant as “cut pieces stock lot cloth, new rags” and classified under heading 6310 to the Customs Tariff Act whereas the Department considered the material as prime quality textile items classified under SH 60019200 - The examination report of the Appraiser not exclusively supports the appellant - It contains certain findings which may go to support the Revenue - Textile fabrics of appreciable length in rolled form cannot be treated as rags - In the absence of any specific distinction, one has to go by the popular understanding - The record of cross-examination report also not proving the appellant's case conclusively - Ordered for pre-deposit of Rs.4 lakhs (Para 6 & 7).


Ranjit S Choudari Vs CC, CE & ST (Dated : May 22, 2012)

Customs – Stay / Pre-deposit of Duty – Penalty - The plea of the appellants that, in view of the settlement of the dispute between the main party and the department, the penalties imposed on the appellants cannot survive – Held that : In the case of S.K. Colombowala , a situation where partial penalty was maintained on the assessee by Settlement Commission was also considered and it was held that the mere factum of such penalty on the assessee would not per se be a ground for maintaining a penalty on a co-notice – Granted waiver of pre-deposit of penalties imposed on the appellants (Para 3).


M/s Mohit Paper Mills Ltd Vs CCE (Dated : August 1, 2012)

Customs - Import - Mis-declaration - Confiscation - Redemption Fine - Penalty -Though mis-declaration of the description of the goods was noticed, the custom department accepted the goods to be waste paper inasmuch as the value of the goods was not changed and was of no consequence in evading customs duty. Section 111(m) should in the normal course be invoked only in cases involving mis-declaration for evasion of customs duty or contravention of import policy. Hence, confiscation of the goods under Section 111(m) is not maintainable. Consequently penalty imposed also is not maintainable. (Para 6)


CC Vs M/s Arihant Enterprises (Dated : March 2, 2012)

Customs – Import – Import of old and used copiers, computers systems, etc., in contravention of the provisions of the Foreign Trade Policy - Quantum of Redemption of Fine - It is not the case of the department that the Commissioner has fixed the quantum of redemption fine and penalty arbitrarily - In all these cases, no statement has been taken from the representatives of the respondents and no show-cause notice has been issued to any of the respondents on the ground that they waived written show-cause notices – The basis on which the department is alleging that the redemption fine and penalty imposed by the Commissioner is not adequate is not forthcoming - These are not cases involving any other violation except violation relating to import without requisite licences - Under these circumstances, there is no valid reason to accept the prayer of the department for remanding the matters for fresh decisions for deciding the quantum of redemption fines/penalties (Para 6.1 & 6.2)


M/s Global Agro Impex Vs CC (Dated : May 18, 2012)

Customs - Export - Basmati Rice - Conditions of Notification - Goods presented for export conforms to the criteria of length and ratio of length to breadth as prescribed in DGFT notification. The expert opinion reports that the goods are not basmati rice.The exporter has acted on the basis of notification issued by DGFT and the goods presented conformed to the prescribed standards. Hence, the goods cannot be considered as goods prohibited for export and therefore the confiscation of the goods under Section 113(d) of the Customs Act is not maintainable. The impugned order confiscating the goods and imposing the penalty is set aside. Goods permitted to be taken back to town. (Para 8)


M/s Carrier Airconditioning And Refrigeration Ltd Vs CC (Dated : February 17, 2012)

Customs – Refund – Refund of Special Additional Duty – Rejection of Refund claim on the ground that (i) Rejection of Chartered Accountant Certificate (ii) no endorsement in some of the invoices that no credit of SAD/CVD can be taken based on such invoices (iii) non-submission of original documents (iv) failure to submit VAT returns -Chartered Accountant Certificate – Held that : the CA certificate is complete and the rejection of the same on the ground that there was a sentence stating that the 'procedure performed did not constitute an audit or a review made in accordance with generally accepted standards in India' is not correct - What the auditor seems to be say is that these procedures have been performed as per the requirements of the circular issued by the Board and not in accordance with the principles to be followed by them for conducting audit or review in accordance with audit standards - It is pertinent to note that the CA certificate was issued in November 2008 by which time both the circulars were available and therefore, obviously this is the reason why the CA omitted to explain as to how the CVD/SAD has not been passed on - the rejection of the refund claims on the ground that the CA certificate is not acceptable cannot be sustained – Matter remanded for fresh consideration (Para 3.3).


Shri Vinod Popli Vs CC (Dated : April 19, 2012)

Customs - Import - Under-Valuation - Demand of differential duty - Stay / Dispensation of pre-deposit - There is documentary evidence on record, in the shape of of consignor, correspondence with Government counsel of certificate Department of justice of Hong Kong, civil administrative Region along with the export declaration made by the supplier to prove under-valuation of the import consignment. As such, by taking into account, the overall facts and circumstances of the case, the importers are directed to deposit 35% of the duty.(Para 12) – Pre-deposit ordered for obtaining Stay


Lumix Export & Import Vs CC (Dated : June 7, 2012)

Customs – Demurrage Charges – Lower appellate authority rightly held that the demurrage charges and other incidental charges for goods detained in the customs area are required to be paid by the exporter consignor even if such goods were illegally detained.


M/s Classic Microtech Pvt Ltd Vs CC (Dated : July 31, 2012)

CVD - Since the experts in the field like Indian Rare Earths Ltd Research Centre, Kollam and Indian Bureau of Mines have categorically opined that the imported goods i.e. Zircon sand is nothing but Zircon Ore, and the said expert opinion not having been rebutted and specifications of imported goods match with the ISI standard laid down for Zirconium Ore benefit of Notification No. 4/2006-CE is available – Appeal allowed with consequential relief: CESTAT [paras 18, 19 & 20] RTI application filed by the appellant revealed that the CRCL had not done the analysis of the imported samples in their own laboratory, but had got it done from Indian Rare Earths Ltd Research Centre, Kollam and also have paid the analysis

charges. [para 9]


Bharat Industrial Corporation Vs CC (Dated : June 11, 2012)

Customs – Enhancement of value - First appellate authority considered the contemporaneous evidence and also looking to the source of the goods, held that higher value was declared by other importers for similar goods - Examining from various angles, he reasonably considered the case of the appellants granting adjustment of 25% on account of quantity level difference – No reason to disturb the order of lower appellate authority. Denial of cross examination of the scientist - The Samples drawn and sent for testing by Chemical Testing and Analytical Laboratory under the Department of Industries and Commerce, Guindy, Chennai revealed that the goods imported by the appellants were similar to the comparable import made by other importers. Cross examination called for by the appellant was denied when chemical analysis of samples of appellant and compared case was tested by same laboratory and there was no subjective bias found from the extent and manner of testing done by the laboratory.


Mr Nazhar Ahmed Vs CC (Dated : April 11, 2012)

Customs – Stay / Pre-deposit – Penalty - Smuggling – Concealment of gold ornaments weighing 4.35 kgs. using adhesive tape which was partially inserted in the front portion in the waistline of his pant and in three knee caps worn between his ankle and knees on both legs - Prima facie, the appellant is involved in smuggling of the gold ornaments by concealing in person for monetary consideration - Records revealed that he has undertaken more than one trip to Dubai on similar missions, for a monitory consideration of Rs.5,000/- on each occasion - prima facie, it appears that he is only a carrier of the gold ornaments and therefore leniency can be shown in the quantum of penalty to be ordered to be pre-deposited – Ordered for pre-deposit of Rs.50,000/-(Para 2, 5 & 6).


Ford India Private Ltd Vs CC, Chennai (Dated : March 7, 2012)

Customs - Valuation - Mis-declaration - Vehicles supplied free of charge by Volvo Car Corporation to the appellant - Appellant mis-declared the relationship with the supplier and later admitted the same, claiming it as clerical error - Appellant claimed assessment based on transaction value method under Rule 4 by declaring the transaction as sale, though there was no sale - It is obvious that the officials of the appellant-company have clearly tried to hoodwink the Indian Customs authorities regarding the relationship between the supplier and the appellants, regarding the nature of transaction which was not arm's length sales but free supply, and also the purpose of import - Exemplary penalties are required to be imposed on the appellants

- Matter remanded to re-determine the value under computed value method.


Maharaja Cargo Vs CC (Dated : April 30, 2012)

Customs – Suspension of CHA licence under Regulation 20(2) of CHALR, 2004 –Contention that the immediate action should have been taken under Regulation 20(2) and licence cannot be suspended after six months - DRI had submitted the investigation report dt. 28.9.2011 to the Commissioner of Customs and this report was received in the Commissioner's office on 3.10.2011 - The suspension order which has been issued on 17.10.2011 is within the time limit of 15 days prescribed in the Regulation – Contention that the investigating authority has to furnish his report to the Commissioner within 30 days of the detection of the offence – This is only an internal guideline issued by the Board and cannot be treated as part of Regulation.


M/s Steel Authority Of India Ltd Vs CC (Dated : June 14, 2012)

Customs – Refund – Unjust Enrichment - T he appellants have submitted an affidavit that they have not passed on the extra duty burden to anyone and have also undertaken to compensate the department in case it is found that any amount is passed on - They have produced necessary Chartered Accountant's Certificate and their balance sheet also indicates the amount as 'Receivables' from the department –Appellant entitled for refund.


M/s Century Star Shipping Ltd Vs CCE (Dated: July 25, 2012)

Customs – Confiscation of Tug and Barge on the ground that the same enteredillegally into India – The Barge was imported into India in the year, 2006 pursuant to permission of DG-Shipping's and was converted for coastal run by virtue of the permission granted by the Deputy Commissioner of Customs, Paradip upon payment of duty on entry of the vessels - It is settled law for movements/voyages in or out of the country the Barge, becomes a foreign going vessel and cannot be said to be 'imported goods' – Matter remanded in the light of Tribunal's decision in the case of Nobel Asset Co. Ltd. vs. CC(Prev.)


CCE, CC & ST, BBSR-I Vs M/s Kashvi Power And Steel P Ltd (Dated: July 12, 2012)

Customs - Export - Refund - Applicable rate of duty - Stay - As per Section 16 of the Customs Act, 1962, the rate of duty applicable shall be with reference to the date on

which proper officer makes order permitting clearance and loading of the goods for exportation in accordance with Section 51 of the said Act. The relevant date of determination of rate of duty for export is date of let export and not loading of goods. Stay application rejected. (Para 3)


M/s Pavitar Singh Vs CC (Dated : June 26, 2012)

Customs - Export - DEPB - Fraudulent export -Co-accused - Penalty - Evidence -There is no evidence on record to show the financial involvement of the individual in procuring the exported goods or any assistance rendered for export of the same. Merely because the individual has applied for IE code number and for issuance of DEPB scrip or merely because the proprietor of the exporting company utilized the employee of the individual, cannot be made a basis for imposition of penalty. The entire evidence may lead to a doubt about the individualindulging in fraudulent activities, but cannot be adopted as a legal evidence for upholding the charge of aiding and abeting. Mere knowledge of illegal activities of other persons are not sufficient to invite penal action against a person. (Para 18)


M/s Gupta Steel (Ship Breakes) Vs CC (Dated : August 3, 2012)

Customs - Import - Refund - Consumer Welfare Fund - Interest - Refund claim allowed but credited to the Consumer Welfare fund. The Tribunal however, allowed the refund. The claim of interest was rejected on the ground that the finality of the refund amount was achieved and became payable to the assessee only after the final adjudication in the matter by CESTAT. HELD - The assessee is eligible for the interest from three months after the date of filing of the refund application till the amount of refund is sanctioned to him. (Para 5 & 6)


Saluja Exim Ltd Vs CCE (Dated : January 11, 2012)

Customs - Customs - Fraudulent availment of DEPB - Jurisdiction to raise demand -Customs Authorities are competent to investigate the overvaluation based on which the DGFT takes further action - Revenue lost on account of DEPB licenses obtained fraudulently can be recovered from exporters – Section 28 of the Customs Act, 1962. The short levy has occurred due to the actions of the appellants who made mis -declarations of value and sold it to others who bought the licenses in normal course of transaction - When customs duty is paid through an instrument granted by Government to an exporter for the purpose of paying import duty and when that instrument is used for paying import duty on any goods, such exporter as the holder of the duty exemption certificate is holding out to be the importer for the purpose of Section 28 notwithstanding that the imported goods were not for his use. Quantum of DEPB credit to be recovered - The Shipping bills in respect of which

export proceeds have not been realized within 180 days from date of export is not specified in the order - The extent of overvaluation is also not clearly quantified -There are inherent contradictions in the findings and quantification – Credit can be denied only to the extent of credit earned on account of overvaluation - Matter remanded for correct quantification of credit.


M/s M S Enterprises Vs CC (Dated : March 15, 2012)

Customs - Import - Under-valuation of imported Betel Nut - Imported the goods through other than permitted port by the DGFT - The document said to have been recovered from M/s Integral Traders could be relied upon only after providing the Panchanama under which the said document was recovered - This has not been admittedly done and therefore, there is a clear violation of principles of natural justice - the Commissioner has not adequately dealt with the contentions of the assessee relating to rejection of the declared values and for enhancement of the values for assessment - Commissioner has not adequately dealt with some of the submissions by the importers relating to rejection of declared values and consequent enhancement of values for assessment - the matter has to be considered afresh after supplying copy of the said documents along with Mahazar and the statements of representative of M/s Integral Traders explaining the contents of the said documents (Para 6.1, 6.3, 7.1 & 9).


M/s Flora Marmo Industries Pvt Ltd Vs CC (Dated : January 20, 2012)

Customs - Import - Stay / Dispensation of pre-deposit - Matter required to be perused in detail. Revenue directed to produce the original file of Bill of Entry maintained at the port. Revenue also directed not to precipitate the issue till the outcome of application filed. (Para 2 & 3)


WNS Global Services Pvt Ltd Vs CC (Dated : April 30, 2012)

Notfn. 22/2003-CE, Sl. No.3 of Annexure-I – ‘Turnstiles' procured under exemption to restrict entry/exit of unauthorized persons in operation area and protection of customs bonded premises – lower authorities denied the exemption on the premise that the said system is not a security system but only a part of the security system – upon examining the software produced and functioning of the system it is clear that the item is none other than a ‘security system' – appellant entitled for the benefit – order set aside and appeals allowed with consequential relief: CESTAT [para 5]


K P Abdul Majeed Vs CC (Dated : May 7, 2012)

Customs – Penalty – Smuggling - Huge quantity of smuggled silver bricks of foreign origin along with vehicles, vessel and country crafts used for smuggling/transport of such smuggled goods were confiscated - The appellant himself made detailed confession about his role in the smuggling - the details furnished regarding stay in the hotels stand corroborated from the evidence given by employees of the hotel by identifying the photograph of the appellant - The appellants' confessions thus stand corroborated not only by co-accused but also by other persons and other evidences as found from the hotel registers - the appellant was arrested and produced before the Addl. Chief Judicial Magistrate and he did not make any complaints of ill-treatment before the said Magistrate – the yardstick of preponderance of probability, the involvement of the appellant in the landing of silver and arranging for transport are proved and penalty on him is warranted - In respect of one of the co-noticees, the Tribunal reduced penalty to Rs.1 Lakh from Rs.5 lakhs - similar leniency was sought for on the amount of penalty - Penalty reduced from Rs.20 Lakhs to Rs.5 lakhs (Para 6 to 9). Customs – Retraction – Validity of - the seizure, follow-up investigation was being done by the officials of DRI - The appellant gave confessional statement under Section 108 before the Assistant Director, DRI - A retraction has to be necessarily addressed to the officer to whom the statement was given - The letter addressed to the Collector of Central Excise has to be treated only as a representation or a complaint and not a valid retraction - the letter addressed to Collector does not in any way reduce the evidentiary value of his confessional statement which stands corroborated by other evidence in the form of statements (Para 7.2 & 7.3).


M/s Sharp Logistics Pvt Ltd Vs CC (Dated : July 10, 2012)

Cus - Revenue not above law - they have to follow the provisions of law as laid down in the statute and within time frame work prescribed as there is no provision in CHALR, 2004 to condone delay - CHA allegedly helping M/s General Motors file a time barred refund claim of Rs.5.15 crores which was later withdrawn by the exporter after investigations commenced – although the report of the investigating authority was received in April, 2012, the order of suspension was passed on 23.05.2012 and which is beyond 15 days as prescribed in rule 20(2) of the CHALR, 2004 – order set aside and suspension revoked: CESTAT by Majority.



CC, Bangalore Vs M/s Palletainer Transport Pvt Ltd (Dated : May 2, 2012)

Customs – Fine – Mis-declaration – Splitting the value of equipment into software and hardware to claim benefit of exemption under Notification No.21/2002-Customs for software - No software separately imported - Even considering the value of entire goods imported, fine imposed by Commissioner (Appeals), reasonable – Fine imposed

by Commissioner (Appeals), reasonable - Section 125 of Customs Act, 1962 (Para). Customs – Penalty – Mis-declaration – Splitting the value of equipment into software and hardware - No software separately imported - Authority imposed penalty equal to duty found to be evaded - Commissioner (Appeals) erred in reducing penalty - Appeal against this part of order allowed - Section 114A (Para).


M/s Sheth Developers Pvt Ltd Vs CC (Dated : July 5, 2012)

Cus - Notification imposing provisional anti-dumping duty expired before the date of issuance of final anti-dumping notification – interregnum period - Under provisions of Rule 20(2) of Anti Dumping Duty Rules, the Government has the power to impose final anti dumping duty from the date of imposition of the provisional anti-dumping duty – Appeal dismissed: CESTAT [paras 5 & 6]



M/s Acalmar Oils &Fats Ltd Vs CCE, Visakapatnam (Dated : May 31, 2012)

Customs – Bulk Liquid Cargo – Measurement of Bulk Liquid Cargo - The case of the appellant is that dip measurement should have been after at least 48 hours from the time of receipt of the liquid cargo in the shore tank - The Federation of Oil, Seeds and Fats Association International opinion does not throw any light on this aspect -Appellant never raised any dispute at the time of shore tank dip reading by the Customs which was taken in the presence of the appellant's representative - Since the goods had already been cleared after import, it was not practically possible to takefresh dip measurement of the same stock of liquid in the same tank, as rightly observed by the learned Commissioner (Appeals) – No merits in the appeal (Para 3).


Hitachi Home And Life Solution Ltd Vs CC (Dated : June 5, 2012)

Argument that term ‘refrigerator' used in the customs tariff should be interpreted not in technical terms but according to commercial parlance is fallacious as the customs duty applies to import and export transactions in commodity trade and the tariff takes into account the commercial parlance while classifying the products – Combined refrigerator-freezers with separate external doors merits classification under sub-heading No. 8418 10 90 of the Customs Tariff and are not entitled for the benefit of notfn. 85/2004-Cus – Board Circular 23/2008-Cus is to be given due weightage in view of the fact that the CBEC is the apex body implementing Customs laws and has the responsibility of enforcing the Free Trade Agreement between India and Thailand as contained in notification 85/2004-Cus - Appeal dismissed as being devoid of merits: CESTAT [paras 5.6, 5.8, 5.9, 5.13, 5.15]



M/s Sterlite Industries (I) Ltd Vs CC (Dated : July 31, 2012)

On finalization of provisional assessment adjudicating authority passing an order for refund of excess duty paid - Revenue appeal upheld by Commissioner(A) on the ground that appellant could not discharge the burden of unjust enrichment -applicants have made out a prima facie case for stay as the balance of convenience lies in their favour - Stay granted: CESTAT [para 3]


M/s Neyveli Lignite Corporation Ltd Vs CC, Chennai (Dated : July 19, 2012)

Applicant, a PSU imported capital goods and spare parts by claiming concessional rate of duty in terms of notfn. 16/2000-Cus - as the plant was not viable, the same was sold in auction – differential duty demand of Rs.9.97 Crores confirmed - applicant submitted that there was no condition in notfn. to bar sale of the plant - as per condition 27(3) attached to Sl.No.182 of the Notification No. 16/2000-Cus if the applicants are not using the goods for intended purpose they are liable to pay differential duty – prima facie no case made out for waiver – pre-deposit ordered of 50% of duty amount: CESTAT [paras 2 & 3]


Dr Reddy's Laboratories Ltd Vs CC, Hyderabad (Dated : March 19, 2012)

Customs – DEPB – Mis-declaration of Freight – Appellants exporting P or P medicaments on ‘CIF' basis – While arriving the FOB value of export goods from CIF value, the appellants deducted only basic freight charge and Insurance amounts, excluding the other charges paid to the freight forwarders like Fuel Surcharge (FSC), Security Surcharge (SCC), Weight /Volume Charge, etc., and claimed higher DEPB benefits – Held that : While the Customs authorities have a right to question the valuation in the shipping bill, based on evidence procured during investigation, it is not open to them to modify the contents of DEPB scrips issued by DGFT authority - It is not a case where the Customs authorities referred the matter to the DGFT for cancellation/modification of DEPB scrips issued by the competent authority -Conclusion of restricting DEPB scrips issued by the DGFT Authority may not be proper (Para 7.2). Customs – Export – Freight - the claim of the appellant-company that amounts paid in the name of FSC, SCC etc. to the carriers engaged in international transportation is not part of freight and need not be deducted from CIF value to arrive at FOB value cannot be accepted and the same deserves to be rejected (Para 6.4).


CC, Chennai Vs M/s Pushpit Steels (P) Ltd (Dated : April 10, 2012)

Customs – Importer did not have any Pre-shipment Inspection Certificate as laid down in Foreign Trade Policy – Since the goods were subjected to 100% physical examination, lower appellate authority has taken a correct decision that the goods were not liable for confiscation – Revenue appeal has no merit.


Shri Girish M Jain, Partner Vs CC (Exports), Chennai (Dated : April 20, 2012)

Customs – Export – DEEC - Alleged mis-declaration of Stainless Steel utensils in 17 earlier consignments based on the examination of two subsequent consignments which were found to be of different grade – Revenue appeal against dropping the proceedings in respect of 17 earlier consignments – The review order passed by the Committee of the Chief Commissioners did not provide any grounds on the basis of which a different view can be taken in respect of 17 Shipping Bills -Besides, since the exports covered under these Shipping Bills have not been utilized, not taking any benefit under the impugned advance licences, there is also no loss of revenue –Prayer to remand the matter in respect of 17 Shipping Bills for fresh adjudication would serve no useful purpose. Appeal by the importer against confiscation of the two consignments - The fact that there was mis-declaration in respect of grade of the impugned stainless steel utensils in question is not in doubt – The DRI and Customs authorities have allowed the request of the appellants to convert DEEC Shipping Bills into free Shipping Bills even after the detection of mis-declaration - Having allowed the conversion of DEEC Shipping Bills into free Shipping Bills, the authorities themselves caused the charge of mis-declaration in the DEEC Shipping Bills to get obliterated – Confiscation and redemption fine set aside – However, penalty is upheld, but reduced.


De Nora India Ltd Vs CC & CE, Goa (Dated : April 27, 2012)

Refund - While filing Bill of Entry, appellant did not mention the unconditional exemption available under notification 21/2002-Cus – even assessing officer did not consider this fact – refund claim filed rejected on the ground that appellant had not challenged the assessment – it is the duty of the Customs officer while assessing the bill of entry to assess in accordance with law – failure to do so can be termed as accidental slip or omission which can be corrected in terms of s. 154 of the Customs Act, 1962 – in such an eventuality assessment need not be challenged – one cannot blindly apply the ratio of Priya Blue Industries ad LB decision in Eurotex case - order set aside with consequential relief: CESTAT


Shah Khetaji Dhanaji & Co Vs CC (Dated : June 13, 2012)

Commissioner (A) has held that the appeal is filed beyond the appeal period of 90 days and hence rejected the same – this implies that he has condoned the delay of 30 days – it is seen that the 90 th day is a Saturday and the appeal having been filed on the next working day on Monday is to be taken as filed within time – appeal filed within the condonable limit of Commissioner(A) – matter remanded to pass order on merits: CESTAT [para 4]


M/s Kitex Garments Ltd Vs CC, Cochin (Dated : April 26, 2012)

Customs - Import - Benefit of Exemption Notification - Exemption under Notification No.21/2002-Customs for import of Snap Buttons - In the present case, there is nothing on record indicating that the appellant fulfilled the condition of the Notification - In the orders of the lower authorities this aspect was not adverted to - There is no evidence adduced by the appellant to establish the claim of compliance with the conditions of the Notification - Matter remanded for fresh consideration (Para 2).


CCE, Tirupathi Vs Sandeep Kohli, Director of M/s Tricon Restaurants International (Dated : May 16, 2012)

Customs – Penalty – Imposition of – The present appeal appears to be directedagainst non-imposition of penalty on the respondent in the de novo proceedings -Obviously, Commissioner could not have imposed any penalty on the respondent inasmuch as the original order dropping the penalty was accepted by the department – Hence, no cause of action against the respondent (Para 3).


Central Warehousing Corporation Vs CC, Bangalore (Dated : February 24, 2012)

Customs – Penalty – Imposition of – Penalty under Section 117 of the Customs Act, 1962 – No mens rea is required for imposition of Penalty under Section 117 ibid –Maximum penalty imposable during the relevant period is Rs.10,000/- - This is a case wherein a nominal penalty is required to be imposed and not the maximum penalty imposable under Section 117 ibid - Reduced penalty from Rs.1 Lakh to Rs.1,000/-(Para 5)


M/s Venus Shipping P Ltd Vs CC, Chennai (Dated : March 23, 2012)

Customs – CHA – Penalty imposed under the Customs Act, 1962 in connection with export of red sanders – The lower Appellate Authority, who upheld the penalty did not have the benefit of the final order passed by the Commissioner under CHALR - Final order passed under CHALR absolves the appellant-CHA from any role in the substitution of the cargo by contraband red sanders, a separate penalty under the Customs Act, 1962 is not justified.


Phil Marketing Services Pvt Ltd Vs CC & CE, Goa (Dated : July 2, 2012)

Film rolls imported in bulk and CVD paid as per s.4 of the CEA, 1944 – goods later sent to packer who carried out the processes of packing into individual cartons bearing the MRP and declarations required under the PCR, 1977 and discharging C.Ex duty in terms of s.4A of CEA, 1944 being a manufacturing activity - in view of the above, importer not required to pay CVD as per s.4A of the CEA, 1944 - there has been no loss to exchequer and on the contrary excise duty paid is more than amount of differential CVD demanded - Order set aside and appeals allowed with consequential relief: CESTAT [paras 6 & 7]



M/s Web Knit Exports (P) Ltd Vs CC, Tuticorin (Dated : March 23, 2012)

Customs - Drawback - Jurisdiction - Tribunal has jurisdiction to decide the dispute on payment of interest on drawback -Relevant date for claiming interest under Sec. 75A is after expiry of one month from the date of receipt of CESTAT order in favour of the appellant - No error in the order of the lower appellate authority rejecting the claim for interest.


M/s Sjlt Textiles (P) Ltd Vs CC, Cochin (Dated : April 30, 2012)

Customs – Import – DEEC Scheme – Benefit of exemption for payment of Additional Duty of Customs under Section 116 of the Finance Act, 1999 in respect of DEEC imports – the relevant Notification No. 43/2002-Cus did not grant exemption from payment of additional duty of Customs leviable under the Finance Act, 1999 -Exemption notification has to be strictly construed (Para 3).


M/s Milsoft Technologies Ltd Vs CC, Cochin (Dated : March 27, 2012)

STPI Unit – Import of Goods – Non-fulfilment of Export obligation within the period stipulated – Though the appellant is claiming that they have fulfilled substantial part of the export obligation, no valid evidence has been produced even as of today – Pre-deposit ordered (Para 1).


Starlite Components Ltd Vs CCE, Nashik (Dated : June 12, 2012)

Torches imported from China not for retail sale but for repacking, labelling and branding – importer registered with C.Ex department as such activity is ‘manufacture' u/s 2(f) of the CEA, 1944 and discharging C.Ex. duty on the basis of MRP of M/s Bajaj Electricals Ltd. to whom the goods are sold in bulk for further retail sale - appellants were not required to declare MRP on import and discharge duty liability of additional Customs duty on MRP basis as they are not covered u/r 3 of the Legal Metrology (Packaged Commodities) Rules, 2011 – Appeal allowed [paras 8 & 9] DGFT vide Circular dated 22/01/2001 has clearly stated that import of raw materials, components, bulk imports, etc. would invariably undergo further processing or removal before they are sold to consumer and in respect of these imports, the labelling requirements prescribed under Notification No.44(RE-2000)97-2002 dated 24/11/2000 shall not apply. [paras 4.1 & 8] Penalty - Under Section 112 (a) of the Customs Act, penalty that can be imposed on dutiable goods which are liable to confiscation is only an amount not exceeding the duty sought to be evaded or Rs.5,000/- whichever is greater - therefore, imposition of penalty of Rs.10 lakhs by the adjudicating authority is clearly contrary to the law and, therefore, the reduction in penalty ordered by the lower appellate authority of penalty cannot be faulted at all – Revenue appeal rejected: CESTAT [para7] Order demanding the differential duty set aside inasmuch as there was no requirement of declaring MRP – consequently confiscation of goods under Section 111 (d) and (m) of the Customs Act, 1962 are also not justified – hence question of payment of redemption fine would not arise and also no penal consequence would follow under Section 112 (a) ibid: CESTAT [para 8]



Chanchal Sharma Vs CC & CE, Hyderabad (Dated : May 25, 2012)

Customs – Refund – Unjust enrichment - Refund on account of excess duty paid by the Appellant which was sanctioned and credited to Consumer Welfare Fund - If their claim that the goods were sold only for Rs.3 lakhs is true, then obviously they cannot be held to have passed on the duty burden of over Rs.8 lakhs to the buyers - this is a question of fact which has to be substantiated with documentary evidence before the lower authorities which has not been done – Matter remanded to original authority for fresh consideration (Para 6 & 7).


Mr Vikram Jain Vs CC, Bangalore (Dated : April 9, 2012)

Customs – Penalty – the allegation in the SCN is that goods declared as ‘Silk fabrics'were exported under the DEEC scheme and the very same goods were brought back into India by them in the pretext of importing ‘Mulberry raw silk yarn' under Advance License and duty-free clearance claimed under the said scheme, and this process was ‘recycled' - In the present case, the Commissioner imposed the penalty under Section 114 of the Act "for fraudulently exporting the goods" – But, there is no allegation of "fraudulent" export in the SCN - Moreover, any goods was not alleged to be liable to confiscation in terms of Section 113 of the Act, nor was the appellant alleged to have rendered the goods liable to confiscation - Obviously, in these circumstances, the Commissioner was not in a position to hold the goods liable to confiscation - In the present case, the SCN did not allege the essential, and consequently the adjudicating authority could not hold any goods to be liable to confiscation in terms of Section 113 of the Act - The question whether Section 114 could be invoked against the appellant did not arise in that case – Section 114 of the Customs Act, 1962 (Para 7).


M/s Nimbark Textile Mills Vs CC, Jodhpur (Dated : June 14, 2012)

Notfn. 103/2009-Cus – SCN or the adjudication order does not bring out the legal provisions contravened or the undue benefit claimed - It only states that there were mis-declarations of model number and year of make, of the machines - allegation that the applicants wanted to avail TUF Scheme is baseless as under that scheme only new machines could be imported and the applicants had declared machines to be old – as the appellants have executed bonds supported by bank guarantee at the time of provisional release, pre-deposit waived and Stay granted: CESTAT [para 8]



APP Enterprises Vs CC, Chennai (Dated : March 7, 2012)

Customs – Stay/Dispensation of pre-deposit – Mis-use of Notification No 32/1997 Cus dated 01.04.1997 - Prima facie the appellants could not prove their stand contrary to the observation made by the Adjudicating authority – Pre-deposit of Rs 10 crores ordered.


M/s A D Jayaveera Pandia Nadar & Bros Vs CC, Tiruchirappalli (Dated : March 19, 2012)

Customs – Jurisdiction of appeal on the rejection of renewal of the CHA licence by the Commissioner – No appeal lies to the Tribunal against rejection of such renewal –Appellants are at liberty to approach any other legal forum for redressal of their

grievance.


M/s Hazel Mercanite Ltd Vs CC, Cochin (Dated : March 26, 2012)

Customs – Stay / Pre-deposit – Import – Valuation - Enhancement of value imported goods based on the contemporaneous imports - The subject imports were not direct from the manufacturer whereas the contemporaneous imports were apparently direct from the same manufacturer - Though the appellant heavily relies on a sales contract dated 16.07.2008 covering a quantity of 3500 MTs of the imported chemical, they could not establish a link between this document and the subject imports – Appellants are not able to provide copies of the relevant invoices, purchase order or the like to establish the necessary link - prima facie view that the enhancement of value ordered by the Commissioner on the basis of the value of the contemporaneous import of identical goods from the same foreign manufacturer cannot be faulted – Ordered for pre-deposit of entire amount of duty (Para 4).


M/s Samalkot Power Limited Vs CC, Visakhapatnam (Dated : July 31, 2012)

Customs – Project Imports – Classification - The expression "all goods" used in the two Chapter Notes of Chapter 98 is significant and so is the expression "all items" used in the text of Heading 9801 - The phrase "all items of machinery including ... required for the initial setting up of a unit, or the substantial expansion of an existing unit, of a specified ... power project" means, that the whole lot of items required for the setting up of a power plant or for the substantial expansion of an existing power plant will constitute a bundle or cluster to be covered by Heading 9801 - The Chapter Notes appear to support this legal fiction embodied Heading 9801 - If some of the items/goods are removed from this bundle, the residue will not go to constitute a new power plant or an expanded power plant - It is imperative that, for classification under Heading 9801, the bundle of items/goods must be complete so as to be considered to be "required for the setting up of a power plant or for the substantial expansion of an existing power plant" - In the present case, it is not in dispute that a substantial part of the material requirements for the 2400 MW power project covered by the EPC contract were imported and cleared on payment of duty at merit rates by others -Only some items of machinery were covered by the subject Bills of filed by the appellant - It is not in dispute that these items were also imported for the same project - these items cannot be classified under Heading 9801 - What is classifiable under this heading is the entire bundle of goods/items of machinery, instruments, apparatus, appliances, equipments etc. required for the power project - Most of these items were admittedly imported and cleared on payment of duty without claiming the benefit of project import - The items presented under the subject Bills of Entry cannot, by any stretch of imagination, constitute the whole bundle of goods/items of "required for the setting up of a power plant or the substantial expansion of an existing power plant" and hence cannot be classified under Heading 9801[Para 12 C]. Customs – Project Imports – Initial setting-up of Project vis-à-vis substantial expansion - Whether the 2400 MW power project can be considered to be "expansion project" with reference to the existing 220 MW power plant- The opinion of threeexperts, brought on record is unanimous to the effect (a) that the existing 220MW power plant and the proposed 2400 MW power plant are based on two different technologies (Siemens V94.2 technology and General Electric Frame 9FA technology

respectively), (b) that there are no shared mechanical or electrical auxiliaries between the two power plants, (c) that the proposed 2400MW cannot use the transmission line of the existing 220 MW power plant due to the difference in generation voltage, (d) that the 2400 MW power plant cannot use the gas and water pipelines of the existing power plant of small capacity and (e) that any one power plant can independently function even when the other one is shut down – There is no contest against the above evidence - Considering the technological, operational and other differences between the two power plants certified by the experts, the 2400MW power project cannot be considered to be an "expansion project" with reference to the existing 220MW power plant -the 2400 MW power project should be considered to be "setting up of a new power plant [para 12 A (e)]. Customs – Project Imports – High seas sale agreements - Whether the appellant (Samalkot Power Limited) can be held to be the importer of the goods - It is the claim of appellant that they purchased the goods at high seas from Reliance Infra Limited (RIL) - This claim is based on high seas sale agreements - Copies of high seas sale agreements were produced before the original authority and the same were noted in para 47 of the O-I-O - It appears appellant's claim was not accepted as they had produced only copies of the agreements and not the originals thereof and the Bills of Lading with endorsement in favour of appellant had not been produced - In the interest of justice, appellant should be given an opportunity to substantiate their claim by producing the original high seas sale agreements and the relevant Bills of Lading with the requisite endorsement – Matter remanded for fresh consideration [Para 12 B]. Customs – Project Imports - The authorities below have already declared RIL to be a rightful importer of the goods - They have also held to the effect that RIL has an option to claim assessment of the goods under Heading 9801 in the "substantial expansion category" - Therefore, the option should be given to RIL, should SPL abandon the claim for the goods - Needless to say that the burden will be on RIL to prove, by producing documentary evidence, that they are eligible for the benefit of project import in the "substantial expansion category" and the benefit of Notification No.21/2002-Cus dated 1.3.2002– [Para 12 D]



CC, Patna Vs M/s Katyal Metal Agencies (Dated : March 26, 2012)

Customs - Stay - Refund of Special Additional duty under Notification No 102/2007 Cus dated 14.09.2007 - Whether refund is admissible if the local sales tax is exempted / goods imported are covered under exempted list of sales tax - No prima facie case for staying the order of Commissioner (Appeals) allowing the benefit of Notification No 102/2007 Cus.


M/s Gurukul Global Vision Vs CCE, Bangalore (Dated : March 27, 2012)

Customs – Stay / Pre-deposit of Duty – Import – Fitness Equipment - Under-valuation - Documents recovered in the form of 2 nd revised pro forma invoices and quotations indicate nearly double the prices compared to the prices declared to the Customs -The authorized signatory has clearly admitted in his statement Dt. 06/08/2008 that they declared the prices only to the extent of 50% of the actual price and the balance

amounts have been sent through illegal channel - There was also seizure of more than Rs.1 Crore unaccounted cash - The appellant has not made out a case on merits for full waiver of the dues - Ordered for pre-deposit of further amount of Rs.50 Lakhs (Para 5 & 6).


M/s Tulips Vs CC, Kandla (Dated : May 23, 2012)

Applications for early hearing filed by Department although the appeals were dismissed long ago – this shows lack of co-ordination in the department resulting in un-necessarily burdening the Tribunal which is already having its hands full with 70,000 appeals pending – there was no need for filing EH applications at all: CESTAT [paras 1 & 2]



CC, Bangalore Vs M/s Ni Micro Technologies Pvt Ltd (Dated : May 30, 2012)

Customs – Import – Eligibility of Exemption under Entry Sl. No.320 of Notification No.21/2005-Customs dated 01.03.2005 for ‘Battery for Cellular Phone' – Parts, components and accessories of mobile handsets including cellular phones were chargeable to ‘Nil' rate in respect of basic customs duty and additional customs duty (CVD) under SI.No.320 of Customs Notification No.21/05 at the time of importation of the subject goods - It is common knowledge that a cellular phone cannot function without a battery - If that be so, the battery has to be considered as accessory, if not part/component, of cellular phone and consequently, the benefit of the Notification is admissible to the item imported by the respondent (Para 3).


M/s Kalinga Commercial Corporation Vs CC, Bangalore (Dated : March 20, 2012)

Customs – Stay / Pre-deposit – Imports under EPCG Scheme – Revenue demanded duty on the ground that the appellant has failed to submit installation certificates on time, installed the imported machinery at places different from the premises specified in the licences and not produced evidence relating to fulfilment of export obligation -As the confiscated goods worth about Rs.33 Crores are lying with the Department having not been redeemed and since the Commissioner has already appropriated about Rs.1.5 Crores by way of encashment of bank guarantees, it is appropriate to waive balance of dues (Para 5.2).


M/s Nitin Digital Printers Vs CC, Hyderabad (Dated : April 13, 2012)

Customs – Import of used multi-functional copiers along with accessories –Department held that these are restricted items and allowed for release of the same on payment of redemption fine – Followed the decision of Vijaya Enterprises & Others (2012-TIOL-254-CESTAT-BANG) – reduced the RF and penalty amounts (Para 7.2, 8 & 9).


M/s Madras Cements Ltd Vs CC(Exports), Chennai (Dated : April 30, 2012)

Customs – Refund of Coal Cess paid at the time of import which subsequently has been clarified to be not payable – As per the Chartered Accountant's Certificate, the amount paid as coal cess has been absorbed as expenses and therefore, forms part of the cost of cement manufactured – Orders passed by the lower authorities denying the refund on the ground of unjust enrichment need no interference.


CC, Chennai Vs M/s Penshibao Wang P Ltd (Dated : December 7, 2011)

Customs – Valuation – Related person – Original authority confirmed that the supplier and the importer are related in terms of Rule 2(2)(iv) - Since no departmental appeal was filed, the lower appellate authority had no option but only to consider existence of relationship in terms of Rule 2(2)(iv) or lack of it, and he was not required to and could not have given a finding on relationship in terms of other provisions of Rule 2(2) - Grounds of appeal filed by the Department before the Tribunal referring to the other provisions such as Rule 2(2)(i) and (v) are of no use. Relationship under Rule 2(2)(iv) - In terms of Rule 2(2)(iv) persons can be deemed to be related only if any person directly or indirectly owns, controls or holds 5% or more of the outstanding voting stocks or shares of both of them. It leaves one in no doubt that only if a third person directly or indirectly owns, controls voting stocks or shares of both the supplier and the importer, then the supplier and the importer can be deemed to be related. Principles of natural justice – Plea by the revenue that the original authority was not allowed opportunity to examine / cross-examine the submissions made before the lower appellate authority is devoid of any merit. It is the standard practice that the lower appellate authorities in the rank of Commissioners do send notices to both the appellants and the respondents fixing the dates of hearing and it is always open to the respondent/appellant departmental officers to be present when the appeal against their orders are being heard by the Commissioner (Appeals). If the original authority in this case has chosen to absent himself during the course of hearing, the resultant order passed by the lower appellate authority cannot be questioned on that count.


M/s Hindustan Petroleum Corporation Ltd Vs CCE, Kandla (Dated : June 12, 2012)

Additional duty computed u/s 116 of the Finance Act, 1998/1999 is levied and collected as duty of Customs and hence has to be added in the assessable value of the goods for computing the Additional Duty of Customs u/s 3 of the CTA, 1975 –appellant's contention is that quantity which has been unloaded into the shore tank is only the quantity on which duty liability needs to be discharged and not the bill of lading, quantity - even if appellant would have received lesser quantity of the goods in the shore tanks, the invoice value charged and paid by the appellant would be the correct value unless there is a clear evidence that they have paid the value/price for the quantity received in shore tanks – Appeal rejected: CESTAT [paras 7, 8 & 9]



M/s Shanthi Alloys (P) Ltd Vs CC, Bangalore (Dated : May 10, 2012)

Customs - DEEC Scheme – Import of goods under Notification No.203/92-Customs dated 19.5.1992 - Import of goods by the person other than licensee - the appellant has not been able to show that the goods in question had been imported under an advance license with its transferability endorsed by the licensing authority - In other words, the very fundamental condition attached to the exemption notification in the case of ‘a person other than the licensee' was not satisfied in this case - The question whether any ‘end use certificate' was produced by the importer is, subsidiary to the fundamental condition (Para 1).


M/s Excel Copy Graphics P Ltd Vs CC, Chennai (Dated : March 20, 2012)

Customs – Import of old and used photocopiers without any valid import lincence –Quantum of fine and penalty - The fine and penalty imposed for the unauthorized import of secondhand photocopiers at under-declared prices are indeed very low and the same calls for no further reduction. Defective appeal – Appeal has not been filed by a principal officer of the company as required under Rule 3(2)(c) of the Customs (Appeals) Rules, 1982 and under Rule 8(3) of the CESTAT (procedure) Rules, 1982, and to that extent the appeal is defective.


CC, Chennai Vs Uday Computers Aided Manufacturing Pvt Ltd (Dated : February 24, 2012)

Customs – Relevant date – Contravention of the Customs Act and allied provisions of law should be determined with reference to the import policy prevailing on the date of shipment – As per the import policy prevailing at the time of shipment of goods from

abroad, the goods shall be imported only under a specific licence – Fine and Penalty upheld, but reduced keeping in view the fact that on the date of import, the policy provision had undergone a change and the import of such goods were liberalized.


Global Food Exports Vs CC, Jamnagar (Dated : March 21, 2012)

Customs – Conversion of free shipping bills into DEPB Shipping Bills – Appellant has not fulfilled the conditions stipulated in CBEC Circular No 10/1997-Cus, dt.17.4.97 –Conversion rightly rejected by the Commissioner.


M/s Metal Scrap Trading Corporation Ltd Vs CC, Chennai (Dated : January 30, 2012)

Customs – Import – Concessional rate of duty - End-use Condition – Dispute is regarding the quantity of the goods imported, which has satisfied the end-use condition to claim concessional rate of duty. As it is a mater of fact, matter remanded to examine the issue afresh. (Para 5) Customs – Adjudication – Competence of Chief Commissioner – Chief Commissioner is empowered to exercise powers of Commissioner who is his immediate subordinate officer and appeal against such order passed by the Chief Commissioner is maintainable before CESTAT. (Para 3)


CC, Chennai Vs M/s Madras Fertilizers Ltd (Dated : February 7, 2012)

Customs – Refund – Security Amount deposited at the time of provisional assessment – Applicability of Section 27 of Customs Act – Extra duty deposit is in the nature of pre-deposit and not in the nature of duty. The rigours of the provisions of Section 27 of the Customs Act do not apply to refund of such amount. (Para 3)


CC, CE & ST, Goa Vs Star PVG Exports (Dated : June 18, 2012)

Since adjudicating authority has not ordered confiscation of goods, question of imposition of redemption fine and personal penalty does not arise – moreover, Revenue has not challenged the order of non-confiscation of the goods – Revenue appeal dismissed: CESTAT [paras 3, 4]


M/s Unitech Enterprises Vs CC, Chennai(Dated : March 2, 2012)

Customs – Import of Secondhand Multifunctional Photocopiers also require licence under Para 2.17 of the FTP - In absence of any Tariff item mentioned in Para 2.17 of the FTP, the expression "photocopier machines" used in the context of amendment made to the EXIM policy by Notification No. 31/2005, means all kinds of photocopiers irrespective of its classification. Ratio of Shivam International differed with - Bangalore Bench in the case of Shivam International has wrongly placed reliance on the Supreme Court's decision in the case of Xerox India – The Supreme Court has decided the issue of classification of multifunctional machines for the purposes of charging customs duty relating to the period March, September to November 1999 - Subsequently, the Tariff nomenclature has changed and in the present case the impugned goods are being classified under Heading 8443 31 00 for the customs duty purposes. The ratio of the said decision is no longer relevant to decide the classification of the impugned goods when the new Heading 8443 31 00 completely describes the product and there is no question of choosing one entry over the other. Valuation - The adjudicating Commissioner himself has recorded that the impugned goods were not accompanied by the Chartered Engineer's certificate from the load port and hence the value has been re-determined by ascertaining the value from a local Chartered Engineer. The appellants have also, accepted the value determined by the customs authorities as per the assessment of the local Chartered Engineer - The valuation done by the adjudicating Commissioner is upheld. Fine and Penalty - The appellants are being repeatedly importing the impugned goods without valid import licences - The fine imposed is only 30% of the value determined by the customs authorities and the same cannot be considered to be excessive and therefore, it calls for no reduction – Penalty is reduced to 20% of the value.



Hazari Trading Co Vs CC, Mumbai (Dated : June 13, 2012)

Customs - No case has been booked against the appellant against earlier imports made at JNPT Port and therefore, the value of the imports made at JNPT Port are to be considered as contemporaneous imports - imports made at Chennai Port are of non-comparable or not similar goods, therefore, loading the value on the basis of contemporaneous imports at Chennai Port are not sustainable – Appeal allowed: CESTAT [paras 6(b) & 7] Clarification given by supplier of the goods that the country of origin shown on the box as Japan is their mistake since the goods were initially intended for supply to Mitsubishi, Japan but since they refused to take delivery, the goods were exported to the appellant – Revenue has not controverted the letters nor have denied their genuineness or held that these documents are false - appellant has discharged their onus of proving that the country of origin is China – Order set aside. [para 6(a) & 7]



M/s AVT Natural Products Ltd Vs CC, Cochin (Dated : March 6, 2012)

Customs – Refund – Appellants have paid duty on the entire consignment and part of the consignment was not allowed to be cleared for human consumption and after payment of redemption fine they were re-exported - Appellants should be allowed to produce the documents and the original authority should consider the refund claim afresh (Para 6).


K S Sawant & Co Vs CC, Mumbai (Dated : June 6, 2012)

If the Customs clearance has been done through intermediary and business was got through intermediary, the same is not barred by the provisions of CHALR, 2004 and it cannot be stated that the appellant has sub-let or transferred his licence – it cannot be said that there has been violation of Regulation 12 - Obtaining an authorization from the importer does not mean that the same should be obtained directly; so long as the concerned import documents were signed by the importer, it amounts to authorization by the importer and, therefore, it cannot be said that there has been a violation of Regulation 13(a)- however appellant did not transact the business through his employee but through another clearing agent thereby violating the provisions of Regulation 13(b) - punishment should be commensurate with the gravity of the offence - Revocation is an extreme step and a harsh punishment, which is not warranted for violation of Regulation 13 (b) - forfeiture of security tendered by the appellant CHA is sufficient punishment and revocation is not warranted: CESTAT [para 5.1]


M/s Actavis Pharma Manufacturing Pvt Ltd Vs CC, Chennai (Dated : February 17, 2012)

Customs – Conversion of Free Shipping Bill to DEPB Shipping Bill - Restrictions and conditions which have been laid down in the CBEC Circulars in the context of conversion of free Shipping Bills to Shipping Bills under export promotion schemes have a proper rationale and the same are intended to curb mis- utilisation of export benefits - The Tribunal should not overlook such restrictions or nullify the same - Both the impugned circulars, 4/2004 and 36/2010 have been validly issued and the impugned order passed by the adjudicating Commissioner following those circulars cannot be faulted with. Compliance with procedures - When a well laid procedure is in place and all other claimants of DEPB benefit are following that procedure and are filing DEPB Shipping Bills, it does not stand to reason as to why the appellants want to circumvent that procedure and file a free Shipping Bill initially and ask for substitution later on without giving sufficient reason. Certification by the excise officers at the time of factory stuffing of consignment meant for export under the free Shipping Bill is not a substitute for the required customs examination which is required for grant of DEPB benefit. Section 149 - Even if it is considered that powers under Section 149 can be used not only for amendment of Shipping Bills but also for substitution of Shipping Bills, such powers are required to be exercised by the Commissioner subject to the conditions

and limitations imposed by the Board. Hence, the conditions and limitations imposed by the Board under the earlier Circular dated 16.1.2004 and subsequent Circular dated 23.9.2010 restricting conversion of free Shipping Bills into DEPB Shipping Bills can be validly construed as conditions and limitations imposed by the Board on the Commissioner while exercising his powers under Section 149 – Order passed by the Commissioner rejecting the conversion cannot be faulted with.



M/s British Biologicals Vs CCE, Bangalore (Dated : February 17, 2012)

Customs - Refund - Unjust Enrichment - The certificate issued by the Chartered Accountant is not based on verification of the records of the assessee but based on verification of the fact that there was no change in MRP based on ER-1 returns filed by the appellant - There was no change in the price before importation and after importation and a production of a CA certificate is not enough - Something more is required - Much more is missing in this case as we see from the analysis of the CA certificate - Appellant has not been able to show that there was no unjust enrichment (Para 3).


M/s Rivaa Exports Vs CC, Surat (Dated : June 7, 2012)

Goods imported duty free under Advance Licences – export obligation not fulfilled –duty liability discharged – interest liability – when the petitioners agreed to pay interest under the agreement in the form of undertaking, it is a contractual liability –Petition of appellant dismissed by High Court holding that interest is payable –Appellant, therefore, liable to discharge interest – Appeal disposed of: CESTAT [paras 7, 8 & 9]


Pratima Clearing Agency Vs CC, Mumbai (Dated : June 18, 2012)

Since CHA licence has been issued to appellant by Commissioner of Customs, Pune the Commissioner of Customs (General), Mumbai has no jurisdiction to revoke the same – without going into merits, order revoking the licence set aside and appeal allowed: CESTAT [paras 6 & 7]


Shiv Om Shipping Agency Vs CC, Mumbai (Dated : June 19, 2012)

Allegation against appellant is that in the application for examination under Regulation 8 of the CHALR, 2004, the educational qualification of employee was shown as graduate on the basis of fake degree certificate – imputing the charges under regulation 13(n) and 19(8), the CHA licence was revoked – main duty cast on CHA is for transaction of any business relating to entry or departure of conveyances or the import of export of goods at any Customs station in terms of rule 2(c) of the CHALR –allegations are not covered under Regulation 13(n)/19(8) – inquiry officer has also held that the charges have not been proved – revocation of CHA licence withdrawn with immediate effect: CESTAT [paras 8, 9, 10 & 11]


M/s Global International Vs CCE, Kanpur (Dated : June 15, 2012)

Refund claim of SAD is to be made in accordance with provisions contained in Notification No. 102/07-Cus which is a self contained code and which requires claim to be filed within one year from the date of payment of tax - provision under Section 27 of the Customs Act cannot be read into the same – claim is time barred - appeal rejected: CESTAT [para 4]


Reliance Communications Ltd Vs CC, Mumbai (Dated : April 12, 2012)

RJ-11 port is located on the side of the Free Wireless Terminals for connecting telephone cord to it - imported goods are at the best an Antenna and not a telephone - It is a transmission apparatus incorporating reception apparatus and hence merits classification under CTH 85177090 and not under CTH 85171210 – CVD paid along with interest on pointing out by department – there is nothing on record that the act of the assessee is a deliberate act to avoid payment of CVD – no reason to impose penalty: CESTAT [paras 9 & 10] Revenue appeals dismissed and assessees appeal allowed to extent of dropping of penalty.


Pundole Shahrukh & Co Vs CC, Mumbai (Dated : June 18, 2012)

Role of CHA - 100% EOU - Mis-declaration of the weight of the ingots sought to be exported for fulfillment of export obligation – balance quantity diverted into domestic market thereby evading Customs duty – though the cargo was much less than that declared in Export documents, the cargo was stuffed as FCL and the CHA firm was collecting FCL charges in respect of all the export cargo - entire export transactions were a sham and everyone, the exporter, the CHA, the logistics firm (which is a Division of the CHA firm) and the shipping agent colluded and connived with each other so as to defraud the exchequer - responsibility of the CHA is not over until the

goods are examined and the Let Export Order is given and the goods are handed over to the shipping line for loading on to the vessel - stay has been granted by CESTAT in Customs case only on the ground that both the CHA firm and partner need not be penalized for the same transaction and penalty on one of them will suffice and which shows that there is no exoneration of the CHA at all - Since this is a case of active participation in a fraud perpetrated on the exchequer involving substantial amount of revenue, maximum punishment by way of revocation of CHA licence is justified –Appeal dismissed: CESTAT [paras 5.1, 5.2, 5.3, 5.5, 5.6, 5.7, 5.11 & 6] More than six months had elapsed between the deposition of the statement and the retraction – it is well settled legal position that such belated retraction has no sanctity in the eyes of the law and has to be treated as pure afterthought…para 5.2. Statements recorded under Section 108 of the Customs Act can be relied upon in the proceedings under the CHALR, 2004 …para 5.3



M/s Saurashtra Cement Ltd Vs CC, Jamnagar (Dated : March 9, 2012)

Customs - Loading of goods onto ship without issuance of let export order -Proceedings initiated and penalties levied on appellant-exporter, employees, shipping agent and master of vessel - According to definition of smuggling under Customs Act, once goods are loaded without let export order onto a ship, goods are considered as smuggled and liable for confiscation - When goods are liable for confiscation, penalties are imposable on persons involved - Vessel becomes liable for confiscation only if it is used for smuggling the goods with the knowledge of the owner - In the instant case, when a finding was given by Commissioner that it was a bonafide mistake, vessel cannot be held liable for confiscation - Confiscation of vessel set aside Penalty on company and employees - Since goods were loaded on behalf of the company by following improper procedure and goods rendered liable for confiscation, penalty leviable - When no malafide was established against employees and penalty was imposed on the company, it is not appropriate to impose penalty on employees Penalty on shipping agent and master of vessel - Since master of the vessel is supposed to know basic provisions of law and once he allowed the goods to be loaded in violation of procedure and goods having been rendered liable for confiscation, penalty on master of vessel justified - Shipping agent being responsible for issue of bills of lading for goods and responsible for loading of goods in violation of proper procedure, liable to penalty Since legal provisions were ignored by mistake, redemption fine and penalties reduced


S K Maheshwari Vs CC (EP), Mumbai (Dated : March 2, 2012)

Appellant who impersonated as the exporter was fully aware of the dubious nature of the transactions and aided and abetted the same even though he had no locus standi to get involved in the transaction is liable to penalty under section 114 of the Customs Act, 1962 – it is difficult to believe that appellant undertook this activity on basis of friendship with the exporter – appellant also did not make any efforts to present before the Customs the real persons behind the transactions – charge of abetment clearly established – however, considering that appellants are individuals undertaking this kind of work for small consideration, penalty reduced: CESTAT [paras 5.1, 5.2 &

5.3]


National Organic Chemical Industries Ltd Vs CC, Mumbai (Dated : January 20, 2012)

In SCN proposal was to include the value of drawings and designs in terms of the provisions of Rule 9(1)(b)(iv) of the Customs Valuation Rules, 1988 – however, adjudicating authority has concluded that the said rule does not apply to the facts of the case - having given a finding negativing the proposal in the SCN, the adjudicating authority could not have confirmed the duty demand on a totally different ground altogether: CESTAT [paras 5 & 6] Wanting to classify the drawings and designs under Heading 8479.89 as machinery and demand duty at the rate applicable to machinery is totally untenable in law and has to be set aside - Drawings and designs are rightly classifiable under Heading No. 49.06 and the benefit of duty-free import under this Heading has to be extended to the goods in question: CESTAT. [paras 5 & 6]


Neeta Prakash Modi Vs CC, Mumbai (Dated : February 14, 2012)

Customs - Appellant has been able to produce the documents with regard to bona fide purchases of the seized diamonds and the department has failed to discharge their burden to prove that these documents are fabricated and diamonds in question are illicitly purchased - benefit of doubt goes in favour of the appellant - in the event of seizure of non-notified goods burden of proof is on Revenue to prove that there was illegal import - Appeal allowed with consequential relief: CESTAT


Gill & Co Pvt Ltd Vs CC, Nhava Sheva (Dated : May 18, 2012)

Appellant filed Shipping Bill on 06.10.2007 whereas the vessel had sailed with the goods on 05.10.2007 – if the exporter chooses to export goods without obtaining Let Export Order (LEO) from the proper officer of Customs, he is liable for the consequences – whoever is found to have committed something paving the way for shipment of goods without LEO or to have omitted to do anything to ensure compliance with requirement of section 51 of the Customs Act, 1962 must be held to have rendered the goods liable for confiscation – appellant has not made out any prima facie case for waiver of the penalties adjudged u/s 114(iii) – Pre-deposit ordered: CESTAT [paras 6.5 & 7]


BSN Medical Pvt Ltd Vs CC, Mumbai (Dated : February 27, 2012)

“Skin Barrier Microporous Surgical Tapes” imported by claiming the benefit of Notification No.21/2002 - Cus - samples drawn were not sent for testing – later DRI took samples of the impugned goods from the market and found that these samples are not the Skin Barrier Microporous Surgical Tapes used for managing ostomy cases but “General Purpose Surgical Tape” on the basis of literature provided by their own research unit – prima facie inference cannot be drawn on the basis of mere research -extended period of limitation is not invocable - applicants have made out a prima facie case for waiver of pre-deposit of adjudged dues –Stay granted: CESTAT [para 5]


M/s A G Incorporation Vs CC (Dated : June 28, 2012)

Argument that since customs officers loaded value once at the time of imports to a certain extent further proceedings cannot be initiated by DRI can turn out to be one of the best means to evade customs duty with impunity - the provisions in Customs Act are not that weak to protect the interest of the state "such an argument is not based on any provisions in statute and appears to be not consistent with section 28 of the Customs Act" appellants were mere conduits for arranging inputs at under declared prices - revision of value and consequent duty liability upheld: CESTAT [paras 17.8, 17.9, 19.5 & 31] Importers are neither manufacturers who consume the goods in their own manufacturing process or traders who import the goods and make available the goods at competitive prices to manufacturers in India at arm's length. The importers in question were acting as mere conduits between suppliers in China and actual buyers who used it in further manufacture and having close nexus with the supplier in China. In fact there is only one person behind the three importers. This person cannot demonstrate any special skill or circumstances enabling him to get the impugned goods at low prices. The inference of undervaluation in such circumstances is quite reasonable. So when contemporaneous imports of the goods are shown the burden to prove bonafides definitely shifted to the importers - prices were competitive only to the extent of duty evasion engineered in these imports. Once the burden had shifted to the importer to prove that the declared values were correct the appellants have hardly done anything to discharge such burden except arguments about possible difference in specifications which they chose not to declare at the time of import....para 29 In respect of the penalties imposed on the three importers under section 114A of the Customs Act, the adjudicating authority has not given the option to pay 25%of duty demanded along with interest within 30 days of receipt of the order for final settlement. So we give such option to be exercised within 30 days of receipt of this order. [para 32]



M D Shipping Agency Vs CC, Mumbai (Dated : May 31, 2012)

Rule 13(d) of CHALR – revocation of licence of CHA on the ground that after the import clearance the CHA should have ascertained that the goods imported were transported to the address mentioned on the script of Advance Licence – clearance took place in year 2001 and DRI investigated in 2004 – it may happen that in that year, the transporter might have changed their premises or be non-existent – no

investigations conducted to enquire whether transporter was existing in 2001 – it is not the obligation of the CHA under CHALR to arrange post clearance like transportation to his client – order of revocation set aside: CESTAT [paras 7, 8 & 9]


CCE, Mumbai Vs Windia Power Ltd (Dated : May 8, 2012)

Respondents and the foreign collaborators are related as per the Valuation Rules –however, respondents are at liberty to procure components, parts and accessories form abroad or within India subject to certain specification and approval from their foreign collaborators – royalty is also related to the goods manufactured in India and has no nexus with the cost of the imported components – price of imported goods are not affected - Revenue appeal dismissed: CESTAT [paras 4, 5 & 6]


M/s Radhey Sons Vs CC(ICD), New Delhi (Dated : May 15, 2012)

Customs - Levy of CVD on imported Gum Arabic - In view of the clarification 28.06.07 of the CBEC and the order of the Tribunal in favour of the appellant, impugned order is set aside and the appeal is allowed with consequential relief.


IVICA Cosmai Vs CC, Jamnagar (Dated : May 23, 2012)

To err is human and hence mistake on the part of the captain in not declaring hardened cement, 20 year old dozer caterpillars and out of order motor bike in the IGM can be on account mis-understanding of law and is procedural in nature without any intention to evade duty - Law should not take cognizance of the trifles – Penalty imposed on Master of Vessel set aside and appeal allowed: CESTAT by majority



CC, New Delhi Vs Shashi Goyal (Dated : March 22, 2012)

Customs – Delay in return of Indian Currency seized – Liability to pay interest – There is nothing in Section 27A of the Customs Act, 1962 to provide for payment of interest on such delay – As per Section 2(22) of the Customs Act, goods include currency and no interest is payable when the goods seized and confiscated, but later ordered to be

released by any Court - The owner of the goods cannot claim interest compensation from the revenue for keeping the goods – Tribunal being creature of Statute, cannot do anything beyond the Statute – Revenue appeal is allowed by setting aside the order of the Commissioner (Appeals) allowing payment of interest.


M/s Gimpex Ltd Vs CC, Hyderabad (Dated :June 6, 2012)

Customs – Target Plus Scheme – ‘Broad Nexus ' between imported goods and exported goods - F or claiming the benefit of exemption under Notification No.32/2005-Cusoms dated 08/04/2005 under the Target Plus Scheme, it is was not necessary for the appellants to establish that the goods imported as input by them were usable in the manufacture of the goods exported by them - it was enough for them to establish a broad nexus between the imported input and the exported products with reference to the respective Export Product Groups (Para 21). Customs – Limitation - One has to presume that the TPS certificates were issued to importers by the DGFT after due verification of the relevant Shipping Bills and allied export documents - Obviously, the Shipping Bills filed under the Target Plus Scheme had been duly assessed and all the exports cleared by the Customs authorities for shipment - Copies of such Shipping Bills must be part of the Customs record - If that be so, non-production of copies of Shipping Bills, which documents were already in the Department's possession, cannot amount to "suppression" of the documents by the assessees - Even if it be assumed that the assessees suppressed anything before the Department, they cannot be held to have done so with intent to evade payment of duty. Extended period of limitation not invokable in terms of proviso to Section 28 (1) of the Customs Act, 1962 - Demands of duty is liable to be set aside on the ground of limitation - Penalties imposed under Section 114A of the Customs Act are also liable to be set aside (Para 19.3).



Top Notch Infotronix (India) Pvt Ltd Vs CC, Chennai (Dated : January 31, 2012)

Customs – Exemption under Notification No 21/2002 dated 1.3.2002 denied to the computer cases having two USB ports and audio ports, by treating the same as Populated Printed Circuit Boards - Technical opinion given by the Professor in the Department of Electronics and Electrical Communication Engineering of IIT, Kharagpur clarifies that what is contained in the computer case is an extension of PCB for ease of connection, but the same is not an electronic component or Populated PCB –Exemption allowed.


Daikin Airconditioning India Pvt Ltd Vs CC, Mumbai-II (Dated : May 3, 2012)

Notfn. 29/2010-Cus - merely because in some cases, the imported indoor units of split air conditioners in pre-packed form bearing MRP were sold along with domestically manufactured outdoor units, it cannot be concluded that the indoor units were not intended for retail sale – there is evidence on record that indoor units have been sold as standalone articles in retail – conclusion drawn by lower authorities is not borne out of evidences – SAD exemption available – Appeal allowed with consequential relief: CESTAT [paras 5, 5.1 & 6] Purpose of SAD is to make it at par with local sales on payment of sales tax - As the sales tax has been levied, the question of levying SAD does not arise - from the invoices submitted by the appellant, it is evident that they are discharging the VAT liability on the retail sale of imported indoor units to customers - Therefore, object of levying SAD on imported goods is satisfied so that both the imported goods as well as indigenous goods are at par with respect to levy of local taxes: CESTAT [ para 5.1 ]



Anand Mohata Veg Oil Products Ltd Vs CC, Mumbai (Dated : May 23, 2012)

Less charge notice issued to the applicant after considering the test report is prima facie correct in the eyes of the law. [para 5.1] Bill of Entry filed on 22.09.2003, samples drawn on 24.09.2003 and test report is of the same date - due to passage of time beta carotene in crude palm oil would decrease on day to day basis at the rate of 20 mg/kg per day and in two days it would be 40 mg/kg but this is still less than the required minimum of 500mg as prescribed in notification 21/2002-Cus – Applicant has failed to make out a prima facie case for waiver – Pre-deposit ordered: CESTAT [paras 5 & 6]


M S Healthcare Pvt Ltd Vs CC, Mumbai (Dated : February 8, 2012)

Import of Diclazuril – though the goods are "drugs', the packing, invoice and bill of entry bears a mark that the goods are "feed grade and not for medicinal/human use" - benefit of exemption under Rule 43 of the Drugs and Cosmetics Act, 1945 is available subject to the undertaking that the end use of the imported goods shall not for medicinal/human use - appellants are not required to take licence/NOC from the Drugs Controller - goods are not liable for confiscation - adjudicating authority is directed to release the impugned goods on production of undertaking - Appeal allowed with consequential relief: CESTAT [para 13]


Santon Shipping Services Vs CC, Mumbai (Dated : January 11, 2012)

Customs – CHA Licence – The adjudicating authority has come to the conclusion that the fraud in this case has been committed in so many consignments over a long

period of time and the same could not have happened without the connivance of the CHA. This finding also supports the Commissioners findings under the CHALR, 2004 about the involvement of CHA – the decision of the Commissioner to revoke the CHA licence is justified (Para 6 & 7).


M K Shipping Services Vs CC, Mumbai (Dated: May 22, 2012)

Since the goods under export have been proved to be basmati rice, as revealed on the basis of RTI application filed by the appellant with the AGMARK authority, the charge of mis-declaration of export goods is completely disproved - violation of Regulation 12 & 13 of CHALR is not established - order of the Commissioner revoking the CHA licence does not stand any legal scrutiny and is perverse and bad in law – Appeal allowed with consequential relief: CESTAT [paras 5.1 & 6] In respect of the other shipping bills, the appellant had filed the shipping bills after receiving the APEDA certificate stating that the goods were basmati rice and based on the APEDA certificate he has made the entry in the shipping bill as basmati rice. Therefore, the appellant CHA cannot be blamed for making any false declaration in the shipping bills, since his declaration is based on the certificate issued by the competent authorities. [para 5.1] Based on a retracted statement without any corroborative evidence charge cannot be established. [para 5.1]



International Research Park Laboratories Ltd Vs CCE, Thane-I (Dated : November 21, 2011)

Customs – Stay/Pre-deposit - 100% EOU – Non fulfillment of Export obligation - the fact that the appellant had failed to fulfill the export obligation has been established without any doubt (Para 5.2). Issue of time bar - the duty demands arise from the terms and conditions of the bond executed by the appellant and therefore, the demand is not barred by any limitation of time (Para 5.5) The appellant has not made out any prima facie case for grant of waiver of pre-deposit of the dues adjudged – Ordered for pre-deposit of Rs.15 Crores (Para 6).


CC, Mumbai-II Vs Nico Extrusion Pvt Ltd (Dated : March 5, 2012)

No speaking order under section 17(5) of the Customs Act, 1962 was passed by Revenue for loading the value on the declared value of the goods – in such a scenario value enhancement is not sustainable – no infirmity in the order passed by Commissioner(A) – Stay application and appeal filed by Revenue dismissed: CESTAT [para 3]


CC Vs M/s Rajpurohit Card Tee Ltd (Dated : April 3, 2012)

Tribunal remanding matter for deciding afresh – Revenue filing application seeking clarification as to whether the matter is to be decided by the adjudicating authority or the Commissioner (Appeals) – Tribunal has consciously remanded the matter to the adjudicating authority as defined in section 2(1) of the Customs Act, 1962 – there is no reason for filing the present application as the Act defines “adjudicating authority” – application dismissed as being without merit: CESTAT [para 4]


Vasco Da Gama Distilleries Pvt Ltd Vs CC & CCE, Goa (Dated : April 11, 2012)

Cus - Import of concentrate of Scotch whisky - Enquiries made by DRI with different ports about import of similar goods indicated that identical goods were imported and cleared at much higher value - value enhanced of the imported goods u/r 5 of Valuation Rules by adopting CIF price of Rs.124.59 per bulk litre against Rs.40.90 adopted by appellant and demand confirmed - no evidence available on record to prove that the appellant had paid higher sum than what was declared in the import documents as also in the bank documents - Revenue has completely failed to prove the charge of under-valuation -order set aside and appeal allowed with consequential relief: CESTAT [paras 7.4 & 7.5]


M/s Hickson & Dadajee Pvt Ltd Vs CC, Nhava Sheva (Dated : March 29, 2012)

As the provisions of penalty u/s 114A of the Customs Act, 1962 came into force w.e.f 28.09.1996, therefore, for the imports made in year 1993, appellants are not liable for any penal action – Appeal and stay application disposed of: CESTAT [paras 5 & 6]


Catholic Relief Services Vs CC, Mumbai-I (Dated : May 3, 2012)

Notfn. 148/94-Cus - Exemption - only condition is that the appellant importer should be a registered society for free distribution to the poor and needy - since a certificate issued by the Ministry of Social Justice and Empowerment has been produced, denial of exemption on the ground that the appellant had not produced evidence that they actually distributed the imported goods to the needy and poor is unjustified - Appeal allowed with consequential relief: CESTAT [paras 5 & 6]


M/s Alpha Future Airport Retail Pvt Ltd Vs CC, New Delhi (Dated: May 30, 2012)

Appellant submitting reply to SCN in sealed cover and suggesting that for the purpose of hearing the bank guarantee executed of Rs.9 crore be encashed to the tune of Rs.2.5 crores - interest of Revenue shall be prejudiced in absence of such an order as a preventive measure - appellant to co-operate in adjudication proceedings without seeking adjournments and adjudicating authority to pass order within six weeks of hearing - matter remanded: CESTAT [paras 4, 5 & 6]


Deepak Bhandari Son Of Shri N D Bhandari Vs CC, Amritsar (Dated : May 16, 2012)

Customs - Principles of natural justice - Mis -declaration of goods confirmed based on the statements recorded from the job workers who processed the imported goods -Denial of cross examination of the witnesses would amount to violation of principles of natural justice - Matter remanded for giving adequate opportunity to the appellants to cross examine the witnesses.


M/s ABB Ltd Vs CC, New Delhi (Dated : May 8, 2011)

Refund claim arising out of finalization of provisional assessment - On final assessment, refund flowing shall be paid and duty short paid shall be recoverable -Once such consequence flows, unless otherwise required by statute specifically, refund need not meet the test of unjust enrichment - import was for captive consumption and appellant has not been unjustly enriched - Appeal allowed: CESTAT [para 4]


CC, Nhava Sheva Vs Gudel India Pvt Ltd (Dated : February 20, 2012)

Order passed by Commissioner of Customs (A), Mumbai-II first reviewed by Commissioner (Imports) and then by Committee of Commissioner (General) and Commissioner (Imports) - Neither of them have jurisdiction in matter - Revenue appeal dismissed by CESTAT as not maintainable - fresh appeal filed along with application for condoning delay of 697 days - while dismissing earlier appeal, Tribunal has not given liberty to the appellant to take remedial steps - COD, appeal and stay application dismissed: CESTAT [paras 3, 4 & 5]



M/s Schankar Clearing & Forwarding Vs CC, Delhi (Dated : May 11, 2012)

Customs - Suspension of CHA Licence : Perusal of the statements recorded by Investigation in the bunch of papers given by Revenue throws light that this is not a case for interference by Tribunal when investigation followed by search proceedings has given rise to discovery of incriminating evidence for suspension of CHA licence . However, the appellant deserves to be provided opportunity of hearing to defend against charges. Granting 4 weeks time for defence to be lead by the appellant appropriate adjudication shall be done by learned Commissioner. Upon receipt of the defence reply if any, within a week thereof hearing shall be fixed and if the appellant so chooses to appear in person or through its authorised representative may appear and explain its case. Within 4 weeks of the conclusion of hearing, learned Commissioner shall pass appropriate order.


CC, New Delhi Vs M/s Nath International (Dated : April 19, 2012)

Customs - Valuation - transaction value cannot be rejected without clear and cogent evidence produced by the department with regard to quality, import of origin and place and time of import: there is no dispute that the customs has power to reject the transaction value and enhance the assessable value in terms of Customs Valuation Rules. However, such rejection of transaction value and enhancement of assessable value has to be on the basis of some evidences on record, Contemporaneous imports have to be considered in reference to quality, quantity and country of origin with the imports under consideration. It has been held in a number of decisions that NIDB data cannot be made the basis for enhancement of value. Commissioner (Appeals) has relied upon various decisions of the Tribunal for holding any enhancement in assessment value, the transaction value has to be first rejected based on legal permissible ground as indicated in the valuation Rules. He has also referred to Supreme Court decision in the case of Eicher Tractors Ltd Vs CC ( 2002-TIOL-06-SC-CUS ) in support of his finding that transaction value cannot be rejected without clear and cogent evidence produced by the department with regard to quality, import of origin and place and time of import. In their memo of appeal, Revenue has not advanced any such evidences to support their case. In as much as, no evidence of rejection of transaction value stands produced by the authority, no reason to interfere with the impugned order of Commissioner (Appeals). Mere reference to Commissioner Mumbai guidelines to enhance the value of ball bearings, without first assessing the quality of the goods is not justified. It stands accepted that the ball bearings were mix and not of uniform sizes. As such, Revenue's appeal has no merits.


CC, Kandla Vs M/s Adani Exports Ltd (Dated : May 22, 2012)

There is no provision u/s 129B of the Customs Act, 1962 for condoning the delay in filing of application for rectification of mistake – COD application for delay of 429 days filed by Revenue rejected and consequently ROM also rejected: CESTAT [paras 5, 6 & 7]


Bharat Forge Ltd Vs CC, Nhava Sheva (Dated : May 3, 2012)

If the provisions of the statute are not ambiguous, notings in the files of the Government are not relevant, as the statute has to interpreted in terms of the language used therein – interpretation of the Drawback Schedule has to be made in terms of the language used therein and not based on the interpretation given in the files of the Ministry on the appellant's representation - if a product falls under chapter 87, benefit of drawback is not available merely because the product description matches with those given for goods falling under chapter 73 - Drawback of Rs.5.09 Crores disallowed: CESTAT [paras 6, 7, 7.1, 7.2, 7.3 & 8] Mens rea is not required for imposition of penalty under section 114 - appellant sought ineligible drawback by mis-declaring the goods – the goods though exported are liable for confiscation – section 113 of the Customs Act deals with liability to confiscation and not actual confiscation – section nowhere states that the goods should be seized to determine the liability to confiscation – inasmuch as since the goods are not available for confiscation, question of imposing fine in lieu of confiscation does not arise – fine of Rs.2 Crores imposed is set aside – penalty on appellant manufacturer reduced from Rs.50 lakhs to Rs.20 lakhs – considering the fact that the company officials did not stand to gain personally by filing wrong drawback claim, penalties of Rs.5 lakhs each imposed on company officials set aside -merely because the goods have been examined by the central excise authorities does not absolve the appellants of their responsibility of making the correct declarations in the export documents - This can at best a factor for determination of quantum of penalty and not for imposition of penalty per se – Penalty reduced: CESTAT [paras 7.4, 7.5, 7.8, 7.9 & 8] Argument that they exported the impugned goods under claim for drawback for the reason that they used to export these goods earlier under DEPB is an afterthought to justify wrongdoing - When the matter itself was clarified by the Ministry of Commerce & Industry that export of steering knuckles (fully machined) made after 01.03.2000 DEPB benefit may be allowed under separate entry for parts/ready to use components i.e entry no. 589 of the DEPB schedule, how could the appellant, in respect of exports made in March to May, 2003 be under the impression that the impugned goods are covered under 73.29 and 73.30 of the Drawback schedule on the basis of similar entries in DEPB schedule – conduct of appellant casts serious doubts about their bonafide - For conversion of drawback shipping bills to DEPB shipping bills, an application has to be made u/s 149 of the Customs Act, 1962 – in view of this, the appellant has to make an application to the adjudicating authority along with supporting documents in accordance with law. [paras 7.6, 7.7 & 7.10]



Surbhit Impex P Ltd Vs CC, Mumbai (Dated : January 5, 2012)

Customs – Valuation – In the SCN the department has proposed to re-determine the value under rule 6 of the Customs Valuation Rules, 2007 on the basis of contemporaneous imports of similar goods whereas in the order passed by the adjudicating authority, the value has been determined under Rule 6 read with Rule 5 of the Customs Valuation Rules, 2007 - The proposition in the SCN and its confirmation in the order are totally wrong – The import made in July, 2009 cannot be said to be contemporaneous to the imports made in March, 2010 (Para 6.1). Customs - Classification - the appellants conceded the classification of the goods as proposed by the department (Para 6). Customs – Confiscation of Goods – A wrong declaration of classification in the import document per se on the bonafide belief that the classification is correct cannot make the goods liable to confiscation and the appellant cannot be imposed with penalty on account of a bonafide conduct - Set aside the confiscation of goods, RF and penalties -Ordered for re-quantification of duty based on the classification (Para 6.2 & 6.3).


P V Shashidhar Vs CC, Chennai (Dated : February 3, 2012)

Customs – Stay/ Dispensation of pre-deposit – Keeping in view of the fact that the High Court of Madras had allowed the export on execution of Bank Guarantee, and the appellant undertaking to keep the Guarantee valid till the disposal of the appeal, pre-deposit waived.


M/s Royal Imports Vs CCE, Chennai (Dated : January 27, 2012)

Customs – Mis-declaration of value - There is concurrent finding by both authorities below on the nature, quality and description of the goods - Evidences gathered by Revenue remained un-rebutted - No evidences came to records to hold that the goods were of different nature - Intimate connection of the appellant with the representative of the supplier remained undetached –Mis-declaration in the value of import called for enhancement - No scope for interference to the findings and conclusions of the authorities below.


Tata Yutaka Autocomp Ltd Vs CC, Mumbai (Dated : February 14, 2012)

Royalty paid on the goods manufactured by the appellant to their principal supplier of the raw material - Royalty payment is not includable in the assessable value as there is no finding that what was termed as royalty/licence fee was in fact not such royal/licence fee but some other payments made or to be made as a condition pre-requisite to the sale of imported goods – Appeal allowed with consequential relief: CESTAT [paras 6, 7]


Shri Manjit Singh Vs CC, Nhava Sheva (Dated : February 17, 2012)

Adjudicating authority has clearly held that hardware and software has to be assessed independently on merits whether they are imported together or imported separately based on the Apex Court's decisions in PSI Data System (2002-TIOL-46-SC-CX) and ACER India Ltd. (2004-TIOL-81-SC-CX-LB) - there are letters between the foreign supplier and the appellant indicating the agreed prices - in such a scenario Commissioner has not appreciated the evidence available on records and has arrived at the value of the software without any basis what-so-ever – strong prima facie case in favour – Pre-deposit waived and stay granted: CESTAT [para 6]


Torrent Pharmaceuticals Ltd Vs CC, Chennai (Dated : January 19, 2012)

Customs – Conversion of free shipping bill into Drawback shipping bill – Impugned goods were originally imported under DFRC Scheme and no drawback is admissible on export of the same – Conversion of would be a futile exercise – Further, jurisdictional Commissioner has taken into account the fact that identity of the export goods and imported goods could not be established at the time of export as free shipping bill was submitted – No infirmity in rejection of the conversion.


M/s Vinay Solvent Extraction Inds Pvt Ltd Vs CC, Kandla (Dated : April 2, 2012)

Customs - Stay/Application for waiver of pre-deposit - Imports made under purchased transferable DEPB scrips - DEPB scrips alleged to have been obtained by overvaluation of export goods - DGFT yet to act on reference made by Customs for cancellation of licenses - Action taken by Revenue premature - Prima facie case for full waiver of pre-deposit - Stay granted


P Bhaskar Naidu, CEO Vs CC, Chennai (Dated : February 16, 2012)

Customs – Export of red sanders - Goods entered for export and declared in the relevant shipping bill were granite cobble stones, whereas actual goods found in the container brought to the customs area for export was red sander logs - Hence, the contravention of Section 113(i) is established in view of the mis-declaration of description of goods as well as consequent mis-declaration of value etc. In such a case, it is not even necessary to establish mens rea for imposition of penalty on the exporter – Penalty under Section 114 of Customs Act, 1962 upheld, but reduced to six lakhs.


M/s Natvar Parikh & Co Pvt Ltd Vs CC, Chennai (Dated : February 7, 2012)

Customs – CHA – Forfeiture of the security amount from CHA, charging them with violation of Regulation 13(a) and (d) and they did not have any authorization from the importer - There is nothing to indicate that the appellant-CHA has acted mala fide in any manner - The fact that the bill of lading having title to the goods and also the required Customs bonds etc., were obtained from the importers and given to the CHA through the logistics company, clearly shows that the appellant-CHA did not act malafide and they had the tacit authorisation of the importers – Impugned order cannot be sustained.


CC, New Delhi Vs M/s Krishna Engineering Industries (Dated : January 24, 2012)

It does not make any economic sense to import a machine which has only 7.25% as residual value as declared by importer – moreover the invoice produced is not of any manufacturer or any person who was actually using machine earlier but is of a scrap dealer in U.K – such a circumstance can cause genuine doubt about the value declared – upon inquiry, respondent agreeing to increase the value to Rs.1,09,59,752/- and clearing the machine at the increased value – certificate of Chartered Engineer giving facts is acceptable but the value shown is only an opinion –application of Rule 8 of the Valuation Rules read with Board's Circular 493/124/86-CUS VI dated 19.11.1987 for arriving at a reasonable price is proper – order of Commissioner(A) set aside and Revenue appeal allowed: CESTAT [para 5]


Shri Thansain Vs CC, Noida (Dated : April 23, 2012)

Whether rice presented for export was Basmati or non-Basmati – as per report of the Basmati Export Development Foundation, sample does not meet the specifications prescribed by DGFT vide notfn. 57/2009-2014 dated 17.08.2010 - proceedings initiated for imposition of penalty - if the consignment of rice meant for export was containing admixture of other grain to the extent of 45% as per test report, it would be immediately noticeable even on visual examination - there may be some inadvertent mistake at the laboratory's end and the appellant's request for retest of the sample should have been allowed by authorities – matter remanded. [paras 3, 5, 7] Since partnership firm has already been penalised no cause for imposition of penalty on individual partners – appeals allowed. [paras 6, 7]


Sulthan Ibrahim Mohamed Mohideen Vs CC, Chennai (Dated : February 10, 2012)

Customs – Appellant was found carrying huge amount of electronic goods and walking through the green channel – Fine and penalty upheld – However, considering the duty sought to be evaded was only Rs. 8 lakhs, fine and penalty reduced.


M/s Bharti Airtel Ltd Vs CC, Bangalore (Dated : June 7, 2012)

Customs - Valuation - Import of Telecom Hardware with software preloaded – Value of software to be included in Assessable Value



Foods Fats & Fertilizers Ltd Vs CC, Chennai (Dated : March 2, 2012)

Customs - Refund - The appellants have addressed a letter to the Commissioner of Customs clearly stating their eligibility for refund of Cess paid in excess, there is no reason not to treat the same as a refund application - Impugned orders passed by the authorities below are set aside to the extent of being appealed against and the matter is remanded to the original authority to grant refund, if otherwise due.


CC, Ahmedabad Vs M/s Mangalam Alloys Ltd (Dated : April 2, 2012)

Customs – Eligibility of exemption Notification No. 21/02-Cus to imported stainless steel melting scrap of Chapter 7204.21 – Entry at S. No. 200 is melting scrap of iron or steel which earlier excluded stainless steel and Entry at S. No. 202 is scrap of stainless steel for the purpose of melting – As per Chapter 72 steel covers stainless steel – Appellant eligible to claim exemption under S. No. 200 of Notification No. 21/02-Cus – Notification beneficial to the assessee to be applied – No infirmity in order of Appellate Commissioner


M/s I C Textiles Ltd Vs CC, Vadodara (Dated : April 2, 2012)

Customs - 100% EOU - Levy of additional duty of customs on imports of HSD under Finance Act, 1999 as amended by Finance Act, 2003 - Any goods which are moved into 100% EOU exempted from payment of customs duty - Additional duty of customs under Finance Act also not leviable - Impugned order set aside

2012-TIOL-731-CESTAT-DEL-LB

M/s Intercontinental Cargo Services Vs CC, New Delhi (Dated : April 10, 2012)

Customs – Issues decided by Larger Bench (i) Whether an appeal against the order of Commissioner of Customs in respect of rejection of application for renewal of license under Regulation (11) of CHA 2004 would lie before the Tribunal Reference answered by Larger Bench as follows: No appeal lies before the Tribunal against the order of Commissioner of Customs in respect of rejection of an application for renewal license under Regulation 11 of CHA, 2004 There is a specific provision for filing of appeal to the Tribunal under Regulation 23(8) against orders of suspension or rejection of license but there is no such provision in the case of rejection of renewal of license (ii) Whether CHA may avail the remedy against the order of rejection of application for renewal of license under sub-regulation (5) of Regulation (9) of the said Regulation Reference answered by Larger Bench as follows: If CHA is aggrieved with such rejection of renewal, he can challenge the same before or Chief Commissioner of Customs & Excise as provided under Regulation 9(5) of the CHA Regulation When a fresh application for issuance of license is filed and the same stands rejected by Commissioner, there is a specific provision for filing an appeal before the Chief Commissioner of Customs, in terms of Regulation 9(5) – Rejection of renewal of license cannot be held to be a remediless act whereas refusal to grant a new license enjoys a remedy of challenging the same before Chief Commissioner – Both rejections are on the same platform since results of both the actions is the same i.e. denial of a person to act as CHA – Only difference is that renewal application is a continuation of previous license and procedure stands enacted for the convenience of CHA who already have the license – Renewal of license would enjoy the same remedy as provided under Regulation 9(5) of CHA Regulation – Such rejection can be challenged before Chief Commissioner


M/s Henkel Cac Pvt Ltd Vs CC, Mumbai (Dated : March 9, 2012)

Burden lies on the appellant to establish that the provisions of Chapter II of the PC Rules requiring them to affix MRP are not applicable to the packaged commodity imported by them - appellants contend that after import brand name is put on the imported package (on which Commr(A) has given a contrary finding) and sold to industrial consumers only - matter remanded to original authority for deciding matter afresh: CESTAT [para 5, 5.1]



Consumer Plastics Pvt Ltd Vs CC, Nhava Sheva (Dated : April 10, 2012)

Appellant is transferee of Advance licence – Denial of notfn. 203/92-Cus on the premise that transferor might have taken input stage credit - Transferee cannot be called upon to fulfill the condition (v)(a) of the Notification - It is the original licencee who has to satisfy the above referred condition – order set aside and appeal allowed: CESTAT


M/s GO GO International Vs CC, Chennai (Dated : January 17, 2012)

Customs – Drawback – Though the appellant had claimed drawback on non-duty paid goods and also availed CENVAT Credit on inputs, since the appellant paid Central Excise duty along with interest and also reversed the CENVAT Credit, it is incumbent upon the adjudicating authority to give reasons why drawback is not admissible - For initial infraction of the law, no doubt, an appropriate penalty can be imposed on the appellants but there has to be strong reasons to deny the drawback – Matter remanded.


CC, Tuticorin Vs M/s Dhanalakshmi Paper Mills Ltd (Dated : February 1, 2012)

Customs - Refund - Appellants filed refund claim consequent to the favourable order from the Commissioner (Appeals) – Department seeks to restrict the refund amount by re-classifying the goods on the ground that the Commissioner (Appeals) had allowed only the dispute on valuation, but not on classification - While allowing the appeal on the valuation issue, Commissioner (Appeals) had specifically stated that the original authority had not categorically held the impugned paper to be serviceable paper and he had allowed the appeal not only on the valuation issue but also from the classification angle holding the impugned goods to be paper waste, though not specifically spelt out in so many words. If the Department was aggrieved, it was appropriate for it to file an appeal against the earlier order of the lower appellate authority which has not been done – Appeal rejected.


M/s Arani Agro Oil Industries Ltd Vs CC & CCE, Visakhapatnam (Dated : February 9, 2012)

Customs – ROM Application – Application filed on the ground that Tribunal order did not discuss issues related to fine and penalty imposed by lower authority – Appellants

appeal against Tribunal order in its entirety also dismissed by Supreme Court – ROM not maintainable


Bajaj Auto Ltd Vs CC, Mumbai (Dated : March 2, 2012)

Appellant has intimated to the department the way of exporting Legend scooter to Iran and in consequence to that letter they filed shipping bills by claiming DEPB benefits – benefits were allowed earlier - It is the right of the appellant to claim the DEPB benefit, if available, and if that is not available, the concerned authorities can deny the same but that does not amount to mis-declaration or invite any penal action, redemption fine or penalty - Revenue appeal dismissed: CESTAT [paras 5, 6 & 7]


CCE, Chennai Vs Pentafour Software & Exports Ltd (Dated : December 7, 2011)

Customs – Whether Compact Discs-Audio & Video manufactured by the assessee, a unit in EHTP scheme under EOU scheme, and cleared to DTA during the material period are to be treated on par with CD-ROM to allow the exemption under Notification No. 36/96-Cus. dt. 23.7.96 – Matter remanded in view of the earlier order of remand on appeal by the assessee against the same order of the Commissioner –So far as penalty under Section 11 AC is concerned, Commissioner's decision not to levy penalty under Section 11AC of the Act from the assessee for any period prior to 28.9.96 is perfectly legal and correct – Revenue appeal has no merit in this regard.


Commissioner Of Customs (Exports), Chennai Vs M/s Sanyo India Pvt Ltd (Dated : December 23, 2011)

Customs - Condonation of delay in filing the appeal - Reasons like the Commissioners were preoccupied with certain urgent sensitive issues and that there was torrential rain arid the Customs officers were caught in traffic jam and there was breakdown of the vehicle on the way to CESTAT are not satisfactory for condonation of delay. Refund - Unjust enrichment - Order of the lower appellate authority that the provisons of unjust enrichment are not applicable is not correct as the assessments have been finalized after the amendment to the privisions with effect from 13.7.2006, making the provisions of unjust enrichment applicable even for provisional assessments -However, there is no unjust enrichment in the instant case as they have clearly shown in their balance sheet that this amount is recoverable from the Customs department -Department has no case on merits also.


M/s C P Mota & Co Vs CC, Mumbai (Dated : May 7, 2012)

No employer, worth his name, will put such terms and conditions in respect of his employees holding the employee responsible for all the wrong doings - it is evident that the appellant CHA was receiving commission and not the other way around - CHA has violated the provisions of CHALR, 2004 by sub-letting his licence and also undertaking various transactions in violation of the CHALR provisions stands clearly established - revocation of licence cannot be faulted – Appeal dismissed: CESTAT [paras 5.2, 5.2, 5.3 & 6]



Batra Hospital & Medical Research Centre Vs CC, New Delhi (Dated : January 12, 2012)

Customs - Exemption Notification No. 64/88-Cus - Fulfillment of conditions -Obligation of the hospital - The hospital during certain years failed to meet their obligation of treating at least 40% OPD patients free. Since the obligation to treat at least 40% OPD patients and all indoor poor patients free and reserving at least 10% of the beds for this purpose is a continuing obligation and an integral part of the condition subject to which the exemption under Notification No. 64/88-Cus had been granted, the hospital, on account of their failure to treat at least 40% OPD patients free during certain years are ineligible for the exemption. (Para 6.3.2) Post import obligations - Limitation - Demand - The limitation prescribed under Section 28 of the Customs Act, 1962 does not arise as the provisions of Section 28 are not applicable for recovery of duty for violation of post-import conditions. (Para 6.4) Interpretation of Exemption Notification - The exemption notifications have to be construed strictly and non- fulfilment of the condition, whether intentional or unintentional will result in denial of the same. (Para 6.3.3) Show Cause Notice - Scope of - SCN is the foundation of the demand and an assessee proceeds with that to lead its defence . If SCN does not make specific allegation in clear terms, the Adjudicating Authority cannot go beyond that by any implication or suspicion and the entire proceeding initiated by the show cause notice gets vitiated by unfairness and bias and the subsequent proceeding become an idle ceremony. (Para 11, 12) Ratio of a judgement - Precedential value - The ratio of any decision must be understood in the back ground of the facts of that case. A case is only an authority for what it actually decides and not what logically follows for it. A little difference in facts or additional facts may make a lot of difference in the precedential value of a decision. Reliance should not be placed on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Judgments of Courts are not be construed as statute. The observations made in judgements must be read in the context in which they appear to have been stated. Judges interpret words of statutes; their words are not be interpreted as statutes. (Para 22) Show Cause Notice - Non-disclosure of facts - Basis of allegation - The SCN does not state as to which category the appellant's hospitals belongs. The assessee has stated material fact of its charitable nature. What requires to be seen is whether in fact the assessee's claim to be a charitable hospital is sustainable or not. That fact would berelevant for exemption under Para 1 of the Table appended to the Notification No. 64/88. It is not possible to accept the plea that since the assessee did not claim this earlier, it would be precluded from doing so at a later point of time. As principles of natural justice is not followed matter to be remanded to the original authority. (Para 19, 20) Difference of opinion - Referral to Third member - Whether the SCN discloses the allegations in clear terms and whether a notification has to be interpreted in a pragmatic manner so as to make it workable? As there are differences in opinion matter referred to Third member. (Para 27)



CC, Visakhapatnam Vs M/s Sesa Goa Ltd (Dated : December 30, 2011)

Customs – Refund claim of export duty paid on iron ore exported on the ground that quantify actually exported was less – Exporter's request for correcting quantity only to beat restrictions imposed under s. 27 of Customs Act – Refund claim not filed within prescribed time limit under s. 27 – Section 154 which gives an enabling power to rectify mistakes cannot be used to defeat specific time limit prescribed for claiming refund – Commissioners order directing to correct quantity based on mate receipt violates specific time limit prescribed under s. 27, not sustainable


M/s ANZ International Manufacturing Pvt Ltd Vs CC, Bangalore (Dated : December 30, 2011)

Customs - 100% EOU - Appellant a manufacturer of utility vehicles and parts exported goods and claimed refund of input credit - Refund allowed in part by lower authority and order of lower authority upheld by lower appellate authority - Appellate Commissioner also remanded matter to lower authority with a specific direction to examine claim for the period from 03/05 to 03/06 - No personal hearing granted to assessee before lower authority passed order consequent to remand directions and no reasons given for denying credit on the ground that input services did not relate to manufacture - Matter remanded to lower authority for fresh consideration - Orders of lower authority and lower appellate authority set aside in so far as they relate to denial of input service credits - Order of appellate authority which relates to sanction of refund claims not interfered with


M/s BPL Engineering Ltd Vs CC, Bangalore (Dated : February 6, 2012)

Customs – Stay/Applications for waiver of pre-deposit – Denial of exemption under DEEC notification resulting in demand of customs duty – EODC not produced after lapse of several years against 23 advance licenses – It is not in dispute that in r/o most of advance licenses EODCs are yet to be obtained – Major part of customs demand justifiable on the ground of non-discharge of export obligation – BIFR refused to declare the unit as sick and the matter is pending appeal before appellate authority – Considering the facts and circumstances, pre-deposit of Rs. 1 crore ordered –Section 129E of Customs Act, 1962


M/s Goyal Impex & Industries Ltd Vs CC, Chennai (Dated : January 19, 2012)

Customs – Refund of Special Additional Duty rejected on the ground that original of the triplicate copy of the Bills of Entry could not be filed – A procedure has been laid down under Facility Notice No. 5/2010 dated 27.1.2010 by the Commissioner of Customs (Import), JN Custom House, Sheva as per which subject to execution of an indemnity bond and subject to verification from the EDI record, the SAD refunds can be sanctioned even in cases where original copy of the triplicate Bill of Entry is not available – Matter remanded to the original authority who had no occasion to examine the procedure the same was not brought to his notice – In respect of other Bills of Entry in respect of which claims are held as time barred no interference is required.


M/s Diamond Electricals Ltd Vs CC, Chennai(Dated : February 2, 2012)

Customs - Classification of Indicator Panels incorporating liquid crystal devices - Not to be classified as fire alarm under Heading 8531 1020 , but appropriately classifiable under 8531 20 00 which is specific heading for “Indicator panels incorporating liquid crystal devices”. Ionization smoke detectors are appropriately classifiable under heading 9022 90 and not under Heading 9027 80 10 as claimed by the appellants.


CC, Cochin Vs Shri Abdul Aziz (Dated : January 5, 2012)

Customs – Import of iron rods/channels willfully mis-declared as heavy melting scrap – Goods held liable for confiscation with option to redeem on payment of fine and penalty – Quantum of redemption fine and penalty imposed by Commissioner under challenge by Revenue – Document claimed to be evidencing margin of profit not filed along with memorandum of appeal - It is not the case of Revenue-appellant that any market survey was conducted before or after issuance of SCN – Argument of respondent-importers that s. 125 of Customs Act prescribed only maximum limit of fine and did not prescribe minimum limit not successfully contested by revenue –Quantum of fine upheld


CC Vs M/s Hemraj Exports Pvt Ltd (Dated : March 29, 2012)

Departmental officers are not doing their duty properly before filing application for early hearing - they are advised to check the records as the appeal has already been disposed of by the Bench by way of remand in the year 2004: CESTAT [para 2]


2012-TIOL-619-CESTAT-MUM-LB

Hindustan Petroleum Corpn Ltd Vs CCE, Chandigarh (Dated : March 5, 2012)

Imported customs duty paid goods falling under the CETA, 1985 are ‘excisable goods' but duty is payable under section 11D(1) of the CEA, 1944 by a manufacturer or producer – since the appellant is not a manufacturer or producer, duty u/s 11D is not payable: Larger Bench by a Majority [paras 11, 11.1 & 17] Imported customs duty paid goods will not come within the ambit of "excisable goods" used in the text of sub-section (1) of Section 11D of the Central Excise Act as those goods are not manufactured or produced in India - reference made by the Referral Bench not proper – minority view of Member (T) ...[para 16]



Mohan Kumar Goel Vs CCE, New Delhi (Dated : April 19, 2012)

Main appeal filed by the partnership firm mentioning the penalty imposed on partners was within the limitation period - In as much as the main appeal was filed well within the limitation period of 3 months, the appeals filed by the partners are required to be treated as supplementary appeals and the delay of 985 days in filing the same is required to be condoned – as main appeal of firm was allowed and order set aside, following the earlier order, appeals of partners challenging imposition of penalties also allowed: CESTAT [paras 5, 8]


Blue Star Ltd Vs CCE, Thane-I (Dated : February 29, 2012)

Customs Notification 21/2002-Cus does not provide any condition that the benefit is available subject to the provisions of the Exim Policy – prima facie benefit of notfn. 6/2006-CE cannot be denied in respect of supplies made under International Competitive Bidding – Pre-deposit waived of adjudged dues and Stay granted: CESTAT



M/s Suretex India Ltd Vs CC, Rohtak (Dated : December 13, 2011)

Customs - 100% EOU - Misc. Application has been filed for modification of the Stay Order dated 8.3.2010, for waiving the requirement of pre-deposit of duty demand and

for early hearing of the matter - since the appellant have not been able to establish a prima facie case, total un-conditional waiver cannot be granted as the interests of Revenue have to be safeguarded (Para 1.6, 11 & 12).


CC, New Delhi Vs The Energy Research And Resources Institute (Dated : March 15, 2012)

Appellant a Research Institute – BE filed for clearance of one spectrophotometer, however, packaged contained two spectrophotometers – importer requesting for amendment in BE for including extra goods - error in filing Bill of Entry was detected before taking delivery of goods and Custom Act provides for correction of such errors u/s 149 of the Customs Act – adjudicating authority ordering confiscation and imposing RF of Rs. 1 lakh and penalty of Rs.50,000- Revenue challenging order of Commissioner (A) holding it a bonafide mistake and setting aside order of confiscation and imposition of RF is not required to be interfered – appeal rejected: CESTAT [paras 4, 5] Decisions of the Supreme Court in Jain Exports and Pine Chemical Suppliers cannot be interpreted to mean that no room for correcting a bonafide error: CESTAT [para 4]


M/s Baraskar Brothers Vs CC (General), Mumbai (Dated : April 4, 2012)

Commissioner of Customs (General) should maintain consistency in passing the orders/decisions and should not follow the policy of pick and choose – findings almost identical but in both the cases treatments given are different - since there is no consistency in decision while dealing with the same situation, revoking the CHA licence cannot be permitted – appeal allowed with consequential relief: CESTAT [paras 7, 8]



M/s EDAG Technologies India Pvt Ltd Vs CC, New Delhi (Dated : December 9, 2011)

Customs –Stay / Pre-deposit – Demand - Under-valuation of imported goods -it is clear that the value as well as the description of the imported goods was misdeclared so as to keep the value of the import content. The main appellants have not been able to establish strong prima facie case in their favour - Directed to pre-deposit 50% of the total duty amount confirmed(Para 5).


M/s Vanick Oils And Fats Pvt Ltd Vs CCE, Delhi-III, Gurgaon (Dated : March 29, 2012)

Bakery shortening imported from Sri Lanka at nil rate of duty in terms of notfn 02/2007-Cus - consignment accompanied by certificates issued by an independent testing agency - samples drawn and tested by department revealed fatty acid content and melting point more than the maximum limit permitted under the PFA Act and PFA Rules – Commissioner while allowing re-export imposing redemption fine of Rs.10 lakhs and penalty of Rs. 5 lakhs - appellant bonafidely believed the certificate provided by the foreign supplier - Even Commissioner has not attributed any knowledge or malafide on the part of the appellant – redemption fine reduced to Rs.3.5 lakhs – since no duty is involved, penalty set aside: CESTAT [paras 4, 5]


Zubairullah Sheriff Vs CC, Bangalore (Dated : December 16, 2011)

Customs - Illegal export of foreign currency - Appellants abetting illegal export of foreign currency strongly corroborated by evidences like email sent to the accused and airfare for flight ticket of accused borne by appellants - Findings of Appellate Commissioner does not call for any interference - Since penalty imposed on accused was reduced by Tribunal in an earlier order by taking a lenient view, penalties imposed on appellants also reduced from Rs. 50,000/- each to Rs. 25,000/- each, taking a lenient view


M/s Yazaki Wiring Technologies (I) Pvt Ltd Vs CC, Chennai (Dated : February 10, 2012)

Customs – Refund of excess duty paid due to clerical error – Refund cannot be denied on the ground that the assessment order was not appealed against.


CC, Chennai Vs M/s CDR Health Care Ltd (Dated : February 2, 2012)

Customs – Exemption to hospital equipment / life saving equipment – Department seeks to deny the exemption on the ground that the description of the items given in the Bill of Entry did not tally with the description given in the respective notifications –No reason to differ with the conclusions drawn by the lower appellate authority –Revenue appeal has no merit.


CC, New Delhi Vs M/s Reddy Pharmaceuticals (Dated : March 27, 2012)

Import of goods valued at Rs.42 lakhs without any licence in terms of Rule 23 of the Drugs and Cosmetics Rules, 1945 – appellant applied for licence but could not get the same from the Drugs Controller of India – confiscation ordered u/s 111(d) of Customs Act, 1962 but permission for re-export allowed by adjudicating authority on payment of redemption fine of Rs.5 lakhs and penalty of Rs.2 lakhs – since there is no mis-declaration or deliberate attempt to import mens rea absent – holding it harsh, Commissioner (A) reducing RF to Rs.25,000/- and penalty to Rs.75,000/- - no infirmity in order – Revenue appeal rejected: CESTAT [paras 8, 9]


M/s Midi Extrusions Ltd Vs CC, New Delhi (Dated : March 5, 2012)

Customs EDI system assessed bill of entry showing BCD as 7.5% and which was paid by the importer whereas duty was reduced to 3.75% from 01.09.2005 but the Department failed to update their computer system – Final print out of B/E showed the lower rate of duty – in this situation there is no payment adjusted towards Customs duty but only an excess payment in the bank which did not get adjusted towards Customs duty due – although goods have been captively consumed, there is no need for looking at the balance sheet, income tax returns, CA certificate etc. to come to the obvious conclusion that the incidence has not been passed on to the consumer – appellant to be given refund in cash – appeal disposed of: CESTAT [para 6, 7]


Shri Subhash Muljimal Gandhi Vs CC(Dated : October 10, 2012)

Contempt of Court - Appellant making allegation that Bench is favouring Revenue in absence of any evidence - SCN issued for initiation of contempt proceedings not replied by appellant despite grant of several opportunities – appellant seeking exemption from personal appearance and submitting that decision be taken and communicated – since appellant has nothing to say in reply to SCN, matter to be referred to Bombay High Court for proceedings of contempt against appellant: CESTAT [ para 2 ]


M/s Ashok Leyland Ltd Vs CC, Nhava Sheva (Dated : February 2, 2012)

Notfn . 94/96-Cus stipulates that for availing the benefit there under the goods should be the same which were exported -goods under exportation was chassis fitted with engine whereas goods under importation was fully built bus with many fittings and attachments -chassis with engine is classifiable under heading 8706 whereas buses fall under 8702 -for levy of Customs duty goods have to be assessed “as presented before the Customs” - since goods are not the same, lower authorities have correctly

rejected the claim of the appellant for benefit of notification: CESTAT [ para 7, 9 ]



Cummins (India) Ltd Vs CC, Pune (Dated : April 12, 2012)

IC Diesel Engines notified under rule 3 of Drawback rules for purpose of All Industry Rate of drawback – Both, the appellant and the department committed an error in applying for and sanctioning of the brand rate of draw back under rule 6 - sanctioning authority is expected to know that the product is notified under Rule 3 and, therefore, brand rate of draw back cannot be sanctioned under Rule 6 – it, therefore, cannot be alleged that the appellant made a wrong declaration with deliberate intention to avail ineligible draw back – Matter remanded for consideration afresh for sanction of drawback under rule 7: CESTAT [paras 5, 5.1, 5.3, 6]



CC, New Delhi Vs M/s Reliance Communications Infrastructure Ltd (Dated : December 8, 2011)

Customs – Refund of additional duty under Notification No 102/07 Cus dated 14.09.2007 paid on imported Set Top boxes – Set Top boxes after importation were given to the consumers on right to use basis – Sales tax / VAT paid on such right to use – Refund cannot be denied on the ground that there was no sale of goods. Sale – Definition - The main purpose of the exemption is that the same goods should not suffer SAD as well as VAT/ Sales Tax. Though the word 'sale' has not been defined in the notification, it is clear that the word 'sale' must be understood in the sense in which it has been defined in sales tax /VAT Acts of various State Governments or Central Tax Act, 1956 and in their Acts, the word 'sale' also includes transfer of right to use any goods for any purpose (whether or not for a specified period) for cash or deferred payment or other valuable consideration.



CC, New Delhi Vs M/s National Research Centre On Bio Plant Technology (Dated : November 25, 2011)

Customs – Refund of excess duty paid – Importer had filed Bill of Entry for three packages whereas only two packages arrived – Revenue's contention that since the assessment of Bill of Entry was not challenged, refund is not admissible is not acceptable - Filing of Bill of Entry prior to delivery of import manifest and payment of duty in respect thereof does not constitute the assessment of Bill of Entry - In the absence of ' lis ' between the respondents and the Revenue, non challenge of bill of entry will not be fatal to the respondents" claim of refund of excess deposit.


M/s Adani Wilmar Ltd Vs CC, Kandla (Dated : February 3, 2012)

Customs – Classification of Bakery Shortening – Whether classifiable under CTH No 1516.20 and eligible for exemption from additional duty of excise under Notification No 4/2005 CE dated 1.3.2005 as contended by the importer or under CTH No 15.17 as contended by the revenue - For classifying the goods under Chapter heading 1517, it would be necessary to show that the same had been further prepared by a processes like emulsification, churning, texturation etc., to change the basic character of the same from being a product classifiable under Chapter heading 1516 to that of Chapter heading 1517 - In the instant case, it is absolutely clear that the goods merit classification under 15.16 and need not to go to the Chapter 15.17.


CC, Ahmedabad Vs M/s Essar Steel Ltd (Dated : September 20, 2011)

Customs - Refund - Unjust Enrichment provisions will not apply to the refund claims arising out of finalisation of provisional assessment, prior to 13.07.06: the law is now squarely settled to the effect, that the provisions of unjust enrichment will not apply to the refund claims arising out of finalisation of provisional assessment under Section 18 of the Customs Act, 1962, prior to 13.07.06. In the case in hand, the finalisation of the provisional assessment took place prior to 13.07.06 and letters claiming the amounts were also filed prior to 13.07.06, hence held that the impugned order of the Commissioner (Appeals) is correct and there is no infirmity in the, said order.


M/s Maize Products Vs CC, Ahmedabad (Dated : February 29, 2012)

Customs- Rejection of Refund - No allegation in the Show Cause Notice that shipping bills are not challenged - Order beyond the Show Cause Notice - Not sustainable: there was no allegation in the Show Cause Notice nor the appellant was put to notice as regards rejection of refund claim on the ground that the shipping bills are not being challenged. The lower authorities have travelled beyond the allegations made in the Show Cause Notice and hence these orders are not sustainable.


Sumangala Steels Pvt Ltd Vs CC, Chennai (Dated : March 2, 2012)

Customs – Export of Non-alloy steel / Alloys steel – Dispute on whether the goods exported are Non-alloy steel subject to export duty under Notification No.66/08-Cus.

dt. 10.5.08 or only Alloy Steel on which no export duty is payable – For deciding whether the goods exported as alloy/non-alloy steel, Board has clarified that the description in import schedule of the Customs Tariff to be borrowed – As per the test reports of samples, the impugned goods satisfy the requirement of 0.0008% boron specified in the import schedule – Confiscation, fine and penalties set aside. Error margins in testing - It is well settled that when the error margin or tolerance limit is applied and the resultant value conforms to the declared value, no case can be held to have been proved against the assessee - Scientist from NML has indicated an error margin which is as high as 200% - In respect of one sample, boron content has been indicated by NML on the second test as 0.0003% - An error margin to the extent of 200% on the positive side takes it up to 0.0009% - Normally, the tolerance limits are within 1-5% - It is a pity that the Board has directed the field officials to apply the borrowed definition of alloy steel from the Import Schedule of the Customs Tariff for the purpose of applying export duty, but has not made arrangements for proper testing of boron content as is glaringly observed in this case. This problem does not seem to have been addressed by the Indian Customs Administration whereas in other countries similarly applying the HSN, methods have been developed to determine the boron content accurately.



M/s Starlite Components Ltd Vs CCE & CC, Nashik (Dated : April 9, 2012)

Torch imported by appellant on which no MRP declared although goods are in ready condition for sale in retail market – MRP declared by Bajaj (customer) adopted for demanding differential duty – since issue of recurring nature and goods in custody of department, ordered to be released on execution of bond and bank guarantee: CESTAT [ para 5,6,7 ]



M/s Big Apple MFG Vs CC, Hyderabad (Dated : November 25, 2011)

Customs – Refund – Import of ‘Intel Dot Stations' – Adoption of value declared by importer issue settled in favour of importer by Tribunal resulting in filing of refund claims for excess duty paid – Refund claims rejected by lower authorities holding that they were barred by limitation of time - Excess duty paid by importer on enhancement of value during assessment of B/E to be regarded as 'duty paid under protest' when valuation is challenged in higher appellate forum and settled in favour of assessee -Refund claim not hit by time limitation – As regards issue of unjust enrichment raised by DR, matter to be dealt with by original authority after granting reasonable opportunity of hearing to appellant


M/s Mass Trading Co Vs CC, Chennai (Dated : December 23, 2011)

Customs - Import - Old and Used Tyres - Hazardous Waste - Certification by Pollution Control Board - Goods to be cleared only on certification by Pollution Control Board. If found to be hazardous waste goods to be re-exported on payment of fine and penalty. Matter remanded to be decided within one month to avoid further demurrages. (Para 4)


Sri Channa Kranti Kumar Vs CC, CE & ST, Hyderabad (Dated : November 28, 2011)

Customs – Import of used BMW car as part of unaccompanied baggage in November 2010 – UK registration certificate shows that car acquired by importer in August 2010 – Original authority enhanced value of imported car, ordered absolute confiscation of car and imposed penalty of Rs. 1 lakh – Appellate Commissioner upheld original authority's order but reduced penalty to Rs. 50,000/- - A person who has lived in aforeign country for a period of 3 years entitled to import a car without license provided the vehicle was in his use for a minimum period of one year before his return to India – Appellant lived in a foreign country for 3 years and no allegation that vehicle was sought to be imported by someone else in the name of appellant – Order of absolute confiscation not sustainable, importer allowed to redeem vehicle on payment of Rs. 2 lakhs as redemption fine – Enhancement of value by lower authority based on manufacturer's price after granting discount and allowing depreciation, upheld – Applicable duty on enhanced value payable by importer at the time of redemption of vehicle – As vehicle was imported violating licensing restrictions and attempted to clear by declaring a lower price, levy of penalty justified – Penalty imposed by Appellate Commissioner upheld – Sections 111(d) and 112(a) of Customs Act, 1962 read with Rule 9 of Customs Valuation Rules, 2007


CC, Chennai Vs S Gunasekaran (Dated : December 16, 2011)

Customs – Export – Prohibited goods – Proper officer permitted export – Denial of export benefit - Penalty - An order passed by the proper officer permitting clearance leading to export of the goods does not affect the position that the goods are prohibited goods, therefore, action can be taken against such export of prohibited goods. As there is no mis-declaration by the exporter, penalty reduced. (Para 1 & 2)


A Jabrarullah Vs CC, Chennai (Dated : March 5, 2012)

Customs – Attempting to export foreign currencies and Travellers' cheques – Penalty -Appellant's contribution to attempted export of the impugned goods could not be ruled out – The appellant had conscious knowledge of the deal resulting in attempt to export of the impugned goods, he cannot be said to be a stranger to the deal.

The expression “attempt” within the meaning of the penal provisions is wide enough to take in its fold any one or series of acts committed, beyond the stage of preparation in moving the contraband goods deliberately to the place of embarkation, such act or acts being reasonably proximate to the completion of the unlawful export. The inference arising out of the facts and circumstances established by Customs Authority, unerringly pointed to the conclusion, that the appellant had committed abetment of the offence of attempting to export the impugned goods, in contravention of law – Penalty upheld, but reduced to Rs one lakh.


CC, Chennai Vs M/s Jay Dev Industries (Dated : March 2, 2012)

Customs – Import of used photocopiers without licence – Quantum of fine and penalty – Fine and Penalty imposed by the original authority in the range of 20% to 30% and 5% to 25% respectively are justified – Reduction of the same to 15% and 5% by the appellate authority is not correct - In respect of repeated offences fines and penalties imposed to prevent illegal imports and to effectively implement the Import Policy laid down by the Government have to be upheld if such fines and penalties are not unreasonable or arbitrary. Plea that the impugned goods do not require license as they are multi functional machines - The decision of the Tribunal in the case of Shivam International has been rendered per incurium and the same cannot be followed as a precedent - Its ratio unsettles the settled practice of upholding confiscation of goods similar to the impugned goods and it has been rendered without referring the matter to a Larger Bench. Non-filing of appeals in other cases by the Department - Just because in a couple of cases, there has been inaction on the part of the Department, inadvertent or otherwise, it does not mean that there should be a race to the bottom and other offenders should go scot free even where the department has been alert and has duly filed appeals as in these cases.


Sree Rayalaseema Dutch Kassenbouw Ltd Vs CC, Chennai (Dated : November 3, 2011)

Customs – Export – Conversion of free shipping bill to DEPB shipping bill – The jurisdictional Commissioner has rejected the request of the exporter for conversion of free shipping bills to DEPB shipping Bills stating that DGFT Public Notice dt. 21.8.98 was not in existence at the time of export of goods. However, the public notice specifically states that it retrospectively covers shipments earlier made from 1.4.97 to 14.4.98. If conversion is not allowed on the hyper-technical ground that public notice was not in existence at the time of shipment, the very purpose of the public notice would be defeated. The authorities below are directed to allow conversion of the shipping bills. (Para 1)


M/s Lakshmi Automatic Loom Works Ltd Vs CC, Chennai (Dated : November 2, 2011)

Customs - Export – Drawback – Amendment to shipping bill to change the name of the exporter - The exporter is claiming that machineries have been imported and installed in their factory by an EPCG authorisation holder. The amendment, the exporter is seeking to make, is for the purpose of counting the exports, they have made directly, towards export obligation of the EPCG authorisation holder. HELD -Under the scheme in force, the EPCG authorisation holder should have made the exports indicating that the goods to have been manufactured by the supporting manufacturer. However, this has not been done. No exports have been made by the EPCG authorisation holder in this case. On the contrary, the exports have been made by the exporters directly under claim of drawback. Hence, the Customs authorities have rightly refused to make the post facto amendments sought for by the exporter . (Para 8)


Manasa Impex Services Vs CC & CCE, Coimbatore (Dated : December 7, 2011)

Customs – Failure to pre-deposit the amount ordered to be deposited under Section 129E – Appellant's plea that 50% of the amount was deposited and the matter may be kept in abeyance till their Miscellaneous Petition is decided by the High Court is not acceptable – Appeals dismissed for non-compliance under Section 129E.


M/s Colourtex Vs CC, Kandla (Dated : January 18, 2012)

Customs – Valuation – Overvaluation of CD ROMs exported by the Merchant Exporter under DEPB – FOB price of the goods exported is within the 150% of the value of the goods declared by the manufacturer supplier – As per the guidelines of CBEC, no market enquiry requires to be caused if the FOB value is not more than 150% of the AR 4 value - Para 3.b of the Circular specifically talks about PMV and if it is up to 150% of AR 4 value no market enquiry requires to be caused but if it is more than 150% of AR 4 price, then market enquiry has to be caused – AR 4 price cannot be discarded by the Revenue simply for the reason that the manufacturer had no domestic sale and the domestic sale was to the tune of just merely 0.5% of the total sales affected by them - It is undisputed that even the 0.5% of domestic sales which were affected by the manufacturer were of the value which were the purchase price of Merchant Exporter - Quantum of local sale clearances cannot be determinative factor as to whether the purchase price of Merchant Exporter is incorrect or otherwise –Impugned order is not sustainable.



M/s Araa Leathers Vs CC, Chennai (Dated : November 18, 2011)

Customs – Export – Re-testing of sample – The procedure prescribed allows retesting of samples when the testing for the first time is done by the Chemical Examiner/Deputy Chief Chemists attached to the Customs House. Retesting is done by the Chief Chemist, who is a higher authority. Normally, in respect of outside testing laboratories, retesting is not allowed as it may result in too many frivolous requests. As a very special case, and the exporter having a genuine doubt about the test undertaken, retesting is allowed. (Para 5)


M/s R K Chemicals Vs CC, Mumbai (Dated : March 12, 2012)

Though the appellant made the payment at the time of investigation, the said amount was appropriated towards duty demand and hence it is not pre-deposit but duty -unjust enrichment aspect has also been considered while refunding the amount -question of payment of interest on delayed payment would, therefore, automatically arise - Appeal allowed with consequential relief: CESTAT [para 5]



M/s VXL Instruments Ltd Vs CC, Bangalore (Dated : November 25, 2011)

Customs – 100% EHTP Unit – Refund – Concessional rate of duty under Notification No. 6/06-CE denied for clearance of computers and accessories in DTA – Duty paid @ 16.48% as against 12.36% under protest and claimed as refund – Refund claim accepted on merits but credited to consumer welfare fund by original authority and order upheld by Appellate Commissioner – No dispute that appellants contracted with DTA buyers for cum duty price indicating rate of duty @12.36% - Duty at higher rate paid only at the insistence of department vide its letter wherein appellant denied benefit of Notification No. 6/06-CE for computing CVD component, which was withdrawn subsequently by letter dated 14.06.2008 – Appellants forced to pay higher rate of duty under protest and it is not in dispute that price before 14.06.2008 and after 14.06.2008 to the customers in DTA sale remained the same – Findings of Appellate Commissioner that refund barred by unjust enrichment, set aside – Refund to be allowed to appellant – Section 27 of Customs Act, 1962


P M Abdul Nazer Vs CC, Cochin (Dated : August 11, 2011)

Customs – Seizure of foreign origin gold biscuits resulting in absolute confiscation and levy of penalty – Gold biscuits found covered with cellophane tapes and kept concealed inside a long cylindrical cloth cover tied around abdomen of the carrier – No valid documents produced to prove licit import of foreign origin gold biscuits resulting in seizure – Carrier deposed under s. 108 of Customs Act, 1962 that appellant provided money for purchase of gold biscuits, which was also admitted by appellant in his statement under s. 108 ibid – Evidence on record indicates that carrier was carrying gold biscuits only at the instance of the appellant for a monetary consideration – Appellant could not adduce evidence of licit nature of goods – No

evidence of any valid claim by the carrier or anybody else on the gold biscuits –Absolute confiscation of goods under s. 111(d) ibid upheld – Penalty of Rs. 3.6 lakhs disproportionate vis-à-vis value of goods determined by authorities – In the facts and circumstances of the case, quantum of penalty reduced to Rs. 1 lakh – Sections 108, 111(d), 112, 121 and 125 of Customs Act, 1962


M/s Champs On Web Pvt Ltd Vs CC, Hyderabad (Dated : November 29, 2011)

Customs – 100% EOU – Allegation of removal of capital goods procured duty free from bonded warehouse premises resulting in demand of duty foregone with interest and penalty – Shifting of unit from the registered premises to another location not intimated to authorities in time as Managing Director of company suffered from serious illness as substantiated by medical evidence – Circumstances in which impugned goods were removed from bonded warehouse not properly considered by lower authorities – When warehouse license expired on 21.01.2004 unit can be deemed to be de-bonded with effect from that date as there was no objection from STPI authorities – Assessee liable to pay customs and excise duties on imported and indigenous capital goods respectively – Matter remanded to original authority to rework quantum of duties payable after allowing depreciation – Interest liable to be paid in terms of section 28AB of Customs Act, 1962 and section 11AB of Central Excise Act, 1944 – Confiscation upheld but in the facts and circumstances of the case, fine and penalty reduced to Rs. 50,000/- each – Penalty imposed on MD set aside


M/s Kudremukh Iron Ore Co Ltd Vs CC, Mangalore (Dated : September 12, 2011)

Customs – 100% EOU – Import of ‘carbon steel pipes' whether eligible for exemption under Notification No. 13/81-Cus as ‘capital goods' – Exemption denied on the ground that there is no evidence to show that goods were used within bonded area –Undisputedly, imported pipes were used for replacement of a segment of an underground pipeline exclusively used for bringing raw materials to the plant (bonded area) for manufacture of export goods – Question as to whether appellant violated any of the conditions of the Notification not examined in the proper perspective by Commissioner – Documents evidencing usage of goods were not examined by Commissioner – Matter remanded to Commissioner with a direction to pass speaking order on all issues in accordance with law by hearing the appellant – Notification No. 13/81-Cus dated 14.02.1981


M/s Sundaram Finance Ltd Vs CC, Chennai (Dated : March 2, 2012)

Customs – Fraudulent re-import of goods at inflated value – Goods originally exported from India - Imports made under EOU scheme by availing exemption under Notification Nos 13/81 Cus and 53/97 Cus and the goods are not capable of being used by the EOU as declared – Demand of duty upheld.

Valuation – Value at which the goods were originally imported will be relevant for computing the duty liability – Section 20 of the Customs Act, 1962 - Valuation adopted by the department for computation of the duty based on the mis-declared value in a case of mis-declaration of country of origin with added mis-declaration of nature of goods cannot be sustained. Jurisdiction – ADG, DRI, having been appointed as a Commissioner of Customs is empowered to assign to any officer of customs the functions of a proper officer - In the absence of any conditions and limitations imposed by the Board under Section 5(1), the ADG, DRI can discharge the duties of a proper officer in terms of Section 5(2) of the Customs Act, 1962 – Section 2(34) and Section 5 of the Customs Act, 1962. Importer under Customs Act, 1962 - The financing institution and the bank had ownership over the impugned goods and as owners they have to be treated also as importers under the Customs Act apart from the fact that the Bills of Entry have been filed by them – The other parties, M/s. ETK Softech and M/s. ORJ have also held themselves out to be importers and have filed the Bills of Entry and therefore they are also required to be treated as importers - No infirmity in holding that they are jointly and severally liable for payment of customs duty. Penalty – Considering the reduced liability due to reduction in value to be adopted, penalty imposed is reduced to Rs. 10,00,000/- each, in respect of M/s.SFL, M/s. ICICI Bank and M/s. ORJ and to Rs.10,000/- each in respect of individuals – Confiscation of the goods and redemption fine upheld.



CC & CE, Hyderabad Vs M/s Nitin Digital Printers (Dated : September 16, 2011)

Customs – Import of used photocopiers without requisite license resulting in levy of penalty and redemption fine – Lower appellate authority reduced redemption fine and penalty – Revenue appeal filed on the ground that levy of fine and penalty should be commensurate to market value/profit margin of goods and that appellant has imported such goods for a second time – Grounds of appeal does not have any reference to market value or profit margin, though general observations therein are vey relevant – Appellate Commissioner reduced redemption fine and penalty after consideration of entire facts and circumstances – No valid reasons to interfere with impugned order – Sections 112 and 125 of Customs Act, 1962


Abdul Kareem Poku Vs CC, Cochin (Dated : October 18, 2011)

Customs - Import of car - Investigation by authorities with manufacturer revealed year of manufacture as 2004 whereas importer declared the same as 2000 and that chassis number and engine number found to be different from what were declared in documents. Valuation - Value of car enhanced by original authority along with imposition of penalty and absolute confiscation - Appellate Commissioner upheld enhancement of value and reduced penalty but allowed release of goods on payment of redemption fine of Rs. 2 lakhs resulting in appeals by both parties - No dispute that details furnished by assessee to Customs authorities were at variance with details found during examination and investigation - Appellant except stating that the website relied

upon by department is an unknown website, has not adduced any positive evidence about alternative claim of valuation before lower authorities - Claim by appellant that value added towards refurbished items related to standard accessories not substantiated by making any such claim in reply to notice or before lower authorities or before Tribunal - No reason to interfere with order of Commissioner (A) upholding valuation made by lower authority. Confiscation - No dispute that assessee fulfilled the condition of staying abroad for importing vehicle - Mis-declaration relates to period of use of vehicle by importer - In view of mis-declaration of relevant particulars, confiscation upheld - However, considering the nature of offence, absolute confiscation not warranted - Prayer of department for upholding absolute confiscation rejected - Section 111 (d) and (m) of the Custom Act read with Section 3(3) of the Foreign Trade (Development & Regulation) Act, 1962. Redemption fine/penalty - Since vehicle is lying in department's custody from 2007, there is scope for leniency with regard to redemption fine and penalty - Redemption reduced from Rs. 2 lakhs to Rs. 1 lakh and penalty reduced from Rs. 75,000/- to Rs. 50,000/-


CC & CE, Hyderabad Vs M/s Vignette Software India Ltd (Dated : October 7, 2011)

Customs - Import of goods without any IEC allotted by DGFT nor does the importer come under IEC exempted category - Original authority imposed penalty of Rs. 2000/-under s. 117 of Customs Act, 1962 for importing without IEC Code - Revenue appeal seeking confiscation of imported goods rejected by Commissioner (A) - As it is only a case of procedural violation with no allegation of any mis-declaration of imported goods or non-payment of customs duty no valid reason to interfere with order of Commissioner (A) which has upheld the order of original authority sustaining penalty imposed on importer - Section 117 of Customs Act, 1962


Mahesh P Patel Vs CC, Mumbai (Dated : January 3, 2012)

Applicant, a Chartered Accountant had issued 'Export Promotion Certificate' & 'Solvency Certificate' after verification of export invoices, GR forms, bank statements, balance sheet and capital accounts - it is the allegation of the department that such certificates were issued without visiting the premises of the importer and without verifying books of accounts and thus enabling importer to import goods divert the same in domestic market - charge of aiding and abetment prima facie not sustainable as applicant has discharged his duties in accordance with the law - Pre-deposit of penalty waived and stay granted: CESTAT. [para 4, 5]


M/s Mic Electronics Ltd Vs CC, Hyderabad (Dated : September 19, 2011)

Customs – Stay/Application for waiver of pre-deposit – Import of capital goods availing benefit of exemption under Notification No. 25/02-Cus by DTA unit by following IGCRDMEG Rules, 1966 – Capital goods subsequently transferred to 100% EOU belonging to same legal entity – Though 100% EOU eligible to import capital goods without payment of duty including CVD, DTA unit having imported goods and kept without any use for itself not entitled to take credit – Pre-deposit waived subject to reversal of CENVAT Credit availed by DTA unit – As bank guarantee executed by appellant still in force, deposit of redemption fine waived – Balance of dues waived and stay granted with a direction to keep bank guarantee alive till the disposal of appeal – Section 129E of Customs Act, 1962 – IGCRDMEG Rules, 1996


CC, Tuticorin Vs M/s Stylewood Industries (Dated : September 19, 2011)

Customs - Export of sawn timber by declaring the same as “wooden furniture components” - The impugned goods are covered under Chapter 44, Sl. No 146 of the Export Licensing Schedule and are clearly prohibited for export - Interpretative Rules referred to by the respondents are actually a part of the First Schedule to the Customs Tariff Act, 1975 which contains the Import Tariff - The said rules have no application for the Export Tariff which is contained in the Second Schedule to the Customs Tariff Act, 1975 - Note 2 under "the General Notes to Export Policy makes it clear the export policy is determined by the item description and code number is only illustrative -Confiscation of the goods upheld - But redemption fine reduced to Rs 25,000/-.


M/s Gimpex Ltd Vs CC, Hyderabad (Dated : September 5, 2011)

Customs – Stay/Application for waiver of pre-deposit – Eligibility of exemption Notification No. 32/05-Cus dated 08.04.2005 for import of ‘continuous cast copper rods' under Target Plus Scheme - Exemption denied on the ground that goods imported were copper rods and goods exported were iron ore and stainless steel products and there is no nexus between inputs and outputs – Para 3.2.5 of HBP required only ‘broad nexus' with export product in the sense that any one or more items of the export product group specified in the certificate/license could be exported by importer to claim benefit of exemption notification as held by Bombay High Court in M/s Essel Mining & Industries Ltd. Vs. Union of India & Ors (2011-TIOL-421-HC-MUM-CUS) quashing CBEC Circular dated 08.05.2007 – Prima facie case made out by appellant for full waiver of pre-deposit of dues – Stay granted for recovery of penalties – Section 129 E of the Customs Act, 1962 – Notification No. 32/05-Cus read with Chapter 3.2.5 of HBP Vol. I Jurisdiction – Governmental steps to give retrospective effect to Notification No. 44/2011-Cus (N.T.) dated 6.7.2011 are halfway and since legislation is expected to be completed shortly, jurisdictional objection raised by appellants becomes untenable.


M/s DEE Pearls (India) Pvt Ltd Vs CC, Mumbai (Dated : December 26, 2011)

Rule 41 of the CESTAT Rules - Once Tribunal has passed an order granting stay against recovery of penalties and waiving the requirement of pre-deposit of penalties,

there is no question of recovery of any amount under the Head of penalties or duties from the appellants - only the amount that the department is entitled to recover would be the redemption fine which is covered by the bank guarantee – balance amount of the bank guarantee, if any, should be cancelled/returned – Application allowed: CESTAT. [para 3]


M/s Madras Fertilizers Ltd Vs CC, Chennai (Dated : January 31, 2012)

Customs- Stay and Waiver of Pre-deposit: Import of urea by appellants - PSU Fertilizer company under license from DGFT with condition to manufacture NPK Fertilizer- Appellants packed and sold imported urea to authorized dealers as per governing law for Fertilizer – Held Customs Exemption Notification not violated -Waiver of pre-deposit of customs duty of Rs 32 Crores and interest – Penalty - Heavy penalty of Rs 32 Crores not justified - Violation of License condition; appellants directed to make pre-deposit of Rs 5 Lakhs.



CC, Bangalore Vs M/s CMC Ltd (Dated : September 12, 2011)

Customs - Stay/Application for waiver of pre-deposit – Import of computer network equipments assessed on the basis of unit price declared after allowing higher discounts - Lower authority disallowed higher discounts - No reasons adduced by lower appellate authority for allowing discounts of more than 97% of listed price based on similar imports, as prima facie , the sale involved is a conditional sale -Order of Commissioner (A) stayed as it would work as a precedent for assessing authorities in relation to similar imports


CC, Bangalore Vs M/s Apotex Pharmachem India Pvt Ltd (Dated : September 9, 2011)

Customs/Service Tax – 100% EOU – Refund of accumulated service tax credits under Rule 5 of CENVAT Credit Rules, 2004 – Commissioner (A) after considering the definition of ‘input services' and a plethora of Tribunal decisions held the impugned services as input services vis-à-vis the final products manufactured by assessee – No reason to interfere with the order of appellate commissioner – Rule 5 of CENVAT Credit Rules, 2004


M/s Jesons Industries Ltd Vs CC, Kandla (Dated : January 18, 2012)

Customs – Goods imported by claiming exemption under Notification No 73/2005 Cus for goods imported from Singapore – Country of origin mis -declared as Singapore –Investigation report by Singapore Customs revealed that the goods were actually obtained from Taiwan and Korea – The Adjudicating Authority had gone through the different judgements relied upon by the noticee and rightly held that the decisions are not applicable to the facts of the case – Plea that the appellant were not a party to this fraud as they were not aware of the tainted nature of the certificate of the origin is not sustainable -Order-in-Original confirming the duty demand and confiscating the goods and imposing penalties upheld.


Apco Constructions (P) Ltd Vs CC, Mumbai (Dated : January 3, 2012)

Notfn. 21/2002-Cus – Asphalt Hot Mix Plant imported by appellant for construction of roads in UP consequent upon winning contract but diverted and used in the state of Rajasthan and Tamilnadu as a sub-contractor – since appellant is not named as a sub-contractor they have violated the terms and condition of the exemption notification –Pre-deposit ordered: CESTAT [para 6]



Vijaya Enterprises Vs CC, Hyderabad (Dated : August 5, 2011)

Customs – Import of used multi functional copier machines with accessories without licenses under EXIM Policy – Consignments examined by approved Chartered Engineers resulting in enhancement of values – Duty paid on enhanced values but importers contested redemption fines levied in lieu of confiscation and penalties –Consignments imported are photocopiers with certain additional facilities – Facts in the instant case distinguishable with that of M/s Shivam International case - 2011-TIOL-851-CESTAT-BANG – No reason to interfere with orders of confiscation as adjudged by original authority and lower appellate authority – Since Tribunal gave substantial relief in various cases in r/o redemption fines and penalties, in the facts and circumstances of the cases, redemption fines and penalties reduced – Para 2.17 of Foreign Trade Policy


M/S Viraj Syntex Vs CC, Chennai (Dated : September 19, 2011)

Central Excise – Stay/Dispensation of pre-deposit – Imported nylon filament yarn –Exemption from additional duty of customs under Notification No 29/2004 CE dated 9.7.2004 - Notification No. 29/04-CE is meant for processed filament yarn and the

impugned goods under import are not processed filament yarns, Prima facie, the appellants are not eligible for the duty concession claimed – 50% of the duty ordered to be deposited.


M/S Vijay Refiners Pvt Ltd Vs CCE, Chennai (Dated : September 19, 2011)

Customs – Over-valuation - DEPB Scrips fraudulently obtained – Demand of Duty on buyer of DEPB Scrips - The DEPB scrips fraudulently obtained by over-valuation of exports are yet to be cancelled by DGFT. It is pre-mature of the department to demand duty on the buyer of said DEPB scrips. Demand set aside. Department at liberty to take action as warranted, as and when the relevant DEPB scrips are cancelled by DGFT. (Para 3)


Shri Krishna Overseas Vs CC, Trichy (Dated : October 12, 2011)

Customs – Import – Old and Used Photo copiers – Requirement of license –Restriction on import of photocopier machine is only w.e.f. 19.10.2005 as per amendment made by Notification No.31 dt. 19.10.2005 and not prior to that date. As import is prior to 19.10.2005, fine and penalty imposed are set aside. (Para 2)


CC, Tuticorin Vs M/s Floor Decor (Dated : September 29, 2011)

Customs – Conversion of free shipping bills into Advance Authorisation Bills - The respondents claimed that they were having authorization/licence under Advance Authorization Scheme issued to them and it was due to ignorance and communication gap the CHA has filed the shipping bills as free shipping bills and they have evidence to show the mistake was bonafide - The competent authority under Section 149 is the Commissioner and the respondents seek an opportunity to produce evidence before the Commissioner – Matter remanded to the Commissioner for fresh consideration, after giving opportunity to the respondents to produce evidence and after granting opportunity of hearing.


M/s Avenue Impex Vs CC, Chennai (Dated : October 27, 2011)

Customs - Import of Oats for home consumption in bulk packs of 20 kgs - The appellants are undertaking to provide the details required to comply with the local

laws at the time of re-packing and re-labeling the impugned goods in the Customs bonded area before customs clearance - They are also undertaking to ensure that the Port health authorities are called upon to test the consignment before customs clearance is sought - The prayer made by the appellants is very reasonable and there is no reason why the same should not be allowed - Impugned order is set aside and the customs authorities are directed to allow the appellants to re-pack and re-label the impugned goods in a customs bonded premises, subject to mutual convenience.


M/s Parth Industries Vs CC, Goa (Dated : January 23, 2012)

Commissioner(A) transferring appeals to Call Book – Such an order is without application of judicial mind – there is no power with Commr(A) to pass interim orders – Matter remanded: CESTAT [para 7, 8]



M/s Santowin Polyester Ltd Vs CCE, Vapi (Dated : December 20, 2011)

Customs - Duty demand confirmed by lower authority with interest and penalties -Order of lower authority upheld by appellate authority on the ground that appellants did not comply with direction for order of pre-deposit - Plea that duty demands were confirmed without furnishing documents relied upon for issue of demand notice -Appellants attitude of informing adjudicating authority about non-receipt of documents after date of personal hearing not appreciated - Nevertheless, in the interest of justice, lower authority directed to supply copies of relied upon documents to appellant who will in turn furnish reply within two weeks - Lower authority directed to complete adjudication proceedings after receipt of reply, following principles of natural justice - Impugned order set aside


M/s Penshibao Wang Pvt Ltd Vs CC, Chennai (Dated : September 22, 2011)

Customs – Confiscation of "plant bio fertilizers" rejecting the classification under CTH 3101 0099 and re-classifying under 3808 9910 as pesticides – Fine and penalty - No reasoning has been given by the adjudicating authority for arriving at the quantum of fine and penalty - Taking into account the fact that the importers have incurred demurrage and accepting that the nature of the goods is such that delay has caused deterioration (the goods are made out of seaweed extract), fine is reduced to Rs 3,00,000/- and penalty is reduced to Rs 1,00,000/-


M/s Creative Industries Pvt Ltd Vs CC & CE, Hyderabad (Dated : September 21, 2011)

Customs - Stay/Application for waiver of pre-deposit -Import of Photo Composing System and Afga Type Setting Equipment availing benefit of Notification No. 90/94-Cus - BoEs assessed provisionally - Installation certificates not furnished within stipulated time period resulting in demand of differential duty and assessments finalized denying project import benefits - Appellants plea that installation certificates not furnished in time due to unforeseen circumstances acceptable - Tribunal in earlier instance in appellant's own case held that project import benefits cannot be denied for not furnishing installation certificates - Bank guarantee provided by appellant already encashed to recover dues partially - Prima facie case for waiver of deposit of balance dues - Section 129E of Customs Act, 1962


M/s Dott. ING. Scandura Calibration & Instrumentation (India) Pvt Ltd Vs CC, Chennai (Dated : September 7, 2011)

Customs - Valuation - Related party - Appellant is a 100% subsidiary of the overseas supplier acting as exclusive agent - As the seller settles the prices differently when it sells to third party customers as compared when it sells to the related buyer, declared value cannot be accepted in view of proviso (h) to Rule 4 (2) of the Customs Valuation Rules, 1988 - No error in the order of the Commissioner (Appeals) enhancing the level of price list price for unrelated buyer, minus adjustment of 5% for commercial level difference.


CCE, ICD, TKD, New Delhi Vs M/s Industrial Importers (Dated : January 13, 2012)

Customs - Nickel Silver Turning - Whether eligible for exemption under Notification No 21/2002 Cus dated 21.03.2002, Sl No 438 as “Nickel and Articles of Nickel” - Member (J) held that since the goods are classified under Chapter 75 of the Customs Tariff, exemption cannot be denied - Member (T) held that the description of goods do not satisfy the description given under the exemption notification as the impugned goods contained predominantly copper - Matter referred to the Third Member in view of the difference of opinion.



HPCL Vs CC, Mangalore (Dated : October 3, 2011)

Customs - Stay/Application of waiver of pre-deposit - Whether duty to be paid on shore tank receipt or quantity mentioned in bills of lading - As matter was already decided against assessees earlier, pre-deposit of Rs. 90 lakhs ordered – Section 129E of Customs Act, 1962


M/s Indian Farmers Fertiliser Co-Operative Ltd Vs CCE, CC & ST, Bhubaneswar (Dated : July 27, 2011)

Customs – Transaction value of ‘sulphuric acid' imported in bulk rejected by lower authorities on the basis of contemporaneous imports – Transaction value declared cannot be rejected without sanction of law – In Eicher Tractors Limited 2002-TIOL-06-SC-CUS , Apex Court held that if transaction value cannot be determined under Rule 4(1) [now Rule 3(1)] and does not fall under any of the exceptions in Rule 4(2) [now rule 3(2)], there is no question of determining the value under subsequent rules –Rule 12 of Customs Valuation Rules, 2007 does not empower proper officer to reject transaction value without establishing that the transaction value was not genuine – In r/o the very same assessee and import of the same commodity in a similar situation, issue had been held in favour of assessee-appellant by Tribunal 2010-TIOL-913-CESTAT-KOL – Impugned orders of lower authorities set aside – Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 read with Section 14 of Customs Act, 1962


M/s Binjusaria Metal Box Co Ltd Vs CC & CE, Hyderabad (Dated : October 3, 2011)

Customs – Goods cleared from DTA to SEZ developers/units – Export duty not leviable – Gujarat High Court decision in Essar Steel Ltd 2009-TIOL-674-HC-AHM-CUSfollowed – Impugned order set aside – Section 12 of Customs Act, 1962 read with Second Schedule to Customs Tariff Act, 1975


Gammon India Ltd Vs CC, Mumbai (Dated : December 23, 2011)

Import of Rig for construction of roads - Merely because after servicing and overhauling Rig was tested by boring 4-5 holes at Delhi Metro Rail premises it would be unfair to deny the benefit of exemption notification 21/2002-Cus - Prima facie case in favour - Pre-deposit of duty and penalty waived & stay granted: CESTAT [para 4, 5]



M/s Hibathullah Enterprises Vs CC, Mangalore (Dated : July 25, 2011)

Customs - Stay/Waiver of pre-deposit - Mis-declaration of export goods in shipping billfor export of goods to Dubai - Red sanders mis-declared as roofing tiles - Partner of appellant-firm admitted knowledge of replacement of tiles in a statement recorded under section 108 of Customs Act and this was corroborated by statement given by employee of appellant-firm who signed export contract with UAE Firm - Prima facie not a fit case for full waiver of pre-deposit - In view of the facts and circumstances and plea of financial hardship, appellant-firm directed to pre-deposit Rs. 3 lakhs, employee who signed export contract directed to pre-deposit Rs. 50,000 - Pre-deposit of balance amounts and penalties on other individuals waived - Section 108 of Customs Act read with Section 129E of Customs Act, 1962


CCE & CC, Goa Vs John Miranda (Dated : September 9, 2011)

Importer has provided NIDB data which is Customs own data bank to show that the black deck CD of 'Sony' make itself has been allowed import into India at USD ranging from 8.00 to 8.35 and the unbranded ones have been allowed imports at values ranging from USD 6.00 to 6.65 - value declared by importer is USD 6.65 per set which compares very favourably with the value of the contemporaneous imports not only of 'Sony' brand but also other unbranded varieties - department has completely failed to establish the case of undervaluation or mis-declaration – finding of lower appellate authority cannot be faulted – Revenue appeal devoid of merits hence dismissed: CESTAT [para 6 & 7]


Shri Sanjeevkumar Sood Vs CC, Cochin (Dated : August 12, 2011)

Customs - Seizure of Indian Currency amounting to Rs. 2 lakhs from Captain of vessel - Statement given by Captain and Steamer Agent that it was ship's currency received during its last call at Kochi and meant for procuring provisions and medicines – Letter addressed to Customs, Kochi for procuring an amount of Rs. 14.2 lakhs during its last call at Kochi endorsed by Customs authorities indicating that procurement permitted subject to usual formalities - Application for taking currency on board the vessel did not indicate the provision under which such permission was sought for and permission granted was also subject to usual formalities without any indication of said ‘formalities' – No formal letter of permission issued from any file of Customs department – No indication of officer who initialed such permission – Letter not produced before lower authorities – Matter requires reconsideration afresh by original authority – Orders of lower authorities set aside – Section 111(d) & (l) of Customs Act, 1962 read with Section 3(1)(c) of Foreign Exchange Management Act (Export & Import of Currency Regulations, 2000)


Shri Bhimendra Kumar Goyel Vs CC, Kolkata (Dated : July 28, 2011)

Customs – Goods imported at Kolkata port in the names of different persons in Nepal for transit through India – Goods seized at Kolkata on the suspicion that the same were to be sold in India without payment of customs duty – Appellant in Kolkata seeking provisional release of goods and revenue insists that goods could be released only to the owner - To ensure that the goods are delivered to the owner of the goods, the authorization from owners in Nepal to be obtained is required to be attested by appropriate Govt. Authority in Nepal to identify, the person and counter signed by the Counsel General of Nepal in Kolkata who had issued the authorization for CTD permit – Goods to be released on payment duty and execution of Bond and Bank Guarantee.


CC, Bangalore Vs M/s Kohler India Corporation Pvt Ltd (Dated : August 1, 2011)

Customs – Refund of SAD – Stay/waiver of pre-deposit – Applicant imported generator parts as trader and sold the goods on payment of VAT – Refund claimed under Notification No. 102/07-Cus rejected by original authority on the ground that sale invoices did not indicate that credit of SAD was not admissible – Appellate authority allowed refund as applicant was not a registered dealer to pass on CENVAT credit – No valid reasons adduced by Revenue to stay the operation of Commissioner (A) order – Section 129E of Customs Act, 1962


Sri Channa Kranti Kumar Vs CC, CE & ST, Hyderabad (Dated : October 4, 2011)

Customs – Stay/Application for waiver of pre-deposit – Car imported from UK absolutely confiscated for violation of Import Licensing Notes issued by DGFT – As car valued over Rs. 18 lakhs stands confiscated, pre-deposit of Rs. 50,000/- imposed as penalty under s.112(a) waived and stay granted – Section 112(a) read with section 129E of Customs Act, 1962


CC, Cochin Vs M/s Tata Tetley Ltd (Dated : August 1, 2011)

Customs – Liability to pay SAD on DTA sale of tea bags by 100% EOU – Revenue has not issued any demand notice under s. 28, if no provisions are invoked for demand of duty, any amount paid by assessee required to be refunded to him if such amount is not due – In the instant case neither there was demand of duty nor any finalization of amounts required to be paid by assessee – In absence of any dues from assessee, findings of Appellate Commissioner legal and proper – No infirmity in impugned order – No merits in Revenue appeal


M/s Hinduja Foundries Vs CC, Chennai (Dated : October 12, 2011)

Customs – Adjudication – Impugned order passed by the Commissioner is like an advance ruling – Customs Act, 1962 separately provides for an authority for advance ruling and the Commissioner is not one such authority – Impugned order is set aside – Requests if any made by the importer may be dealt with by the appropriate adjudicating authority in accordance with law.


M/s Divine Shipping Services Vs CC, Jamnagar (Dated : October 11, 2011)

Customs - Stay - CHA license suspended for violation of Regulation 20(2) of CHALR for not obtaining authorization - Action initiated three years later and that too not based on any investigation but on an initiative from the O/o Commissioner namely, Assistant Commissioner, STF - Formal authorisation not essential where the importer who has imported goods does not contradict the CHA and does not say he has not authorised CHA to act on his behalf - Prima facie appellant has made out a case that contravention of Regulation 13(a) is arguable and requires consideration in detail - No clear basis as to how Commissioner reached to a conclusion that CHA was not given any advise and thereby violated provisions of CHALR - In the absence of any evidence to show that CHA had not been advised, contravention of Regulation 13(b) prima facie not sustainable - KYC norms prescribed by Regulation 13(o) introduced only w.e.f. 2010 and view adopted by Commissioner that this is applicable for past period also prima facie not correct - Impugned order suspending CHA license stayed in the interest of justice since issue leads to civil consequences as Revenue did not succeed in showing that immediate suspension was warranted or was in accordance with law or was justifiable prima facie on merits - Order of Tribunal issued without prejudice to the right of department to conduct inquiry and take action as deemed fit, in accordance with law - Customs House Agents Licensing Regulations, 2004


CC, Mumbai Vs Bridgestone India Pvt Ltd (Dated : October 18, 2011)

As per Joint Venture Agreement, Royalty and Licence Fee payments are liable to be made in respect of the goods manufactured and sold in India and not in respect of the goods under importation - provisions of Rule 10(1)(c) of the Customs Valuation Rules, 2007 are not attracted - Revenue appeal dismissed: CESTAT [para 7.2, 7.3]



M/s Singh Overseas Vs CCE, Rohtak (Dated : June 3, 2011)

Customs - 100% EOU - Allegation that appellant, a 100% EOU, was not engaged in any manufacturing activity but diverting duty free imported goods to local market and exporting ready made garments procured from open market - Polyester fabrics imported duty free and lying in factory detained on this premise and duty demanded -Goods in r/o which duty was demanded found in appellants premises which leads to a conclusion that the said goods were not diverted to local market - No demand of duty can be confirmed on the ground that previous consignments were diverted to local market - Demand on this count i.e. diversion of previous consignments neither raised in SCN nor confirmed in the lower authority's order - No presumption can be made that the impugned consignment would also be diverted to local market - Impugned order confirming demand of duty, confiscation and penalty set aside - Notification No. 53/97-Cus dated 03.06.1997


M/s Grasim Industries Ltd Vs CC, Mumbai (Dated : November 11, 2011)

Import under notfn. 21/2002-Cus - if the imported goods have not been used for specified purposes, in view of rule 8 of Customs (Import of Goods at Concessional Rate of Duty for manufacture of Excisable Goods) Rules, 1996, jurisdictional AC/DC of Central Excise is empowered to issue notice u/s 28 for recovery of Customs duty -Commissioner of Customs is not competent authority to issue SCN - Prima facie case in favour - Waiver of pre-deposit ordered and Stay granted: CESTAT [para 5]



M/s Ashwin Vanaspati Indus Pvt Ltd Vs CC, Kandla (Dated : April 27, 2011)

Customs – Refund – Crude palm oil imported and warehoused, cleared subsequently by inadvertently paying higher duty on higher tariff value in ignorance of prevailing notification – When there is no lis between parties regarding assessment of value and duty, refund claim of excess duty allowable without challenging assessment – Delhi High Court judgment in Aman Medical Products Ltd 2009-TIOL-566-HC-DEL-CUS followed – Supreme Court judgments in Flock (India) Pvt. Ltd 2002-TIOL-208-SC-CX and Priya Blue Industries Ltd 2004-TIOL-78-SC-CUS distinguished – Section 15(1)(b) read with Section 27 of Customs Act, 1962


M/s Integrated Rubian Exports Ltd Vs CC, Visakhapatnam (Dated : August 1, 2011)

Customs – Appeal filed before Appellate Commissioner was dismissed for delay on the ground that it was filed after a lapse of five years - Commissioner (Appeals) has no power to condone delay beyond 30 days as prescribed in section 128(1) of Customs Act, 1962 – Section 128(1) of Customs Act, 1962


Hindustan National Glass Industries Ltd Vs CC, Mumbai (Dated : December 20, 2011)

There is no provision of law where the future CENVAT credit admissible can be taken into account while calculating the customs duty payable under Notification no. 94/96-Cus - deduction of CENVAT credit amount while sanctioning refund is not correct –Prima facie case – Stay granted: CESTAT [ para 5 ]



M/s Fresenius Kabi India Pvt Ltd Vs CC, Nhava Sheva (Dated : December 12, 2011)

If the appeal is filed beyond sixty days and within ninety days of the communication of the order-in-original, the appellant should be given an opportunity to explain the reason for the delay - since Commr(A) has the power to condone delay for one month, rejection of appeal on the ground of delay without hearing is violation of natural justice - matter remanded - Stay application disposed: CESTAT [para 4]


M/s Borax Manufacturers Association Of India Vs CC, Kolkata (Dated : September 23, 2011)

Customs – Import of Boric Acid – Consignments not allowed to be cleared on the ground that appellants were not eligible to import the same because boric acid for non-insecticidal use can be allowed only on the basis of an import permit issued by Central Insecticide Board and Registration Committee (CIB and RC), Ministry of Agriculture – Tribunal has no powers to go into the vires of a notification and whether a notification issuing authority had the power to issue such notification – A challenge to vires of notification could be made only before a High Court or Supreme Court –Even assuming that Tribunal had powers to consider the vires of the notification and a challenge could be made, it was opined that the notification did not suffer from any defects – For the purpose of importation of boric acid, if it is an insecticide it is classifiable under Customs Tariff heading 38 and if it is not an insecticide it is classifiable under Chapter 28 – Insecticide Act does not bar restrictions being imposed on import of goods which are not covered by the Insecticide Act and in the instant case, since the goods were imported for non-insecticidal use, requirement of permit and registration flow from the FTDR Act and the notification issued thereunder – No merit in the submissions that the impugned notification is contrary to the provisions of Insecticide Act – Appellants having failed to produce the import permit either at the time of import or subsequently the order of confiscation passed by lower authority cannot be faulted for confiscation and levy of penalty – Since the goods were absolutely confiscated and the total value of goods is less than One Crore Rupees, penalty reduced to Rs. 10 lakhs – Section 38 of Insecticide Act read with Foreign Trade Development and Regulation Act, 1992



M/s Mini Max Overseas Vs CC, Cochin (Dated : August 10, 2011)

Customs – Valuation of Sony brand TVs imported into India by mis-declaring country of origin as China – Department adopted import prices of Sony brand TVs emanating from Malaysia/Thailand pursuant to investigation which established country of origin as Malaysia/Thailand – When country of origin is established as Malaysia/Thailand, charge of mis-declaration stands established – Enhancement of values by department cannot be faulted – Redemption fine and penalty imposed by Commissioner (Appeals) not excessive


M/s Kanak Metal Industries Vs CC, Jodhpur (Dated : August 12, 2011)

Customs – Export of stainless steel utensils under claim for DEPB benefit – Benefits disallowed and exporter penalized for mis-declaration of ‘Present Market Value' and FOB value – DGFT PN No. 10/97 dated 21.05.1997 provides that amount of credit entitlement rate in r/o export products whose DEPB rate is 15% or more, shall not exceed 50% of the PMV of such goods – CBEC Circular No. 69/97-Cus dated 08.12.1997 clarifies that amount of credit has to be restricted with reference to domestic price of the product and not with reference to FOB price declared on GR Form/Shipping Bill – SCN and O-I-O clearly highlight wrong understanding of phrases ‘present market value', FOB value and applicability of appropriate values for determining DEPB credit entitlement – When CBEC Circular 77/02-Cus dated 27.11.2002 offers no clarity on the point as to whether rate is to be applied on PMV or benefit has to be capped at 50% of PMV, Public Notice issued by DGFT prevails over CBEC Circular as regards affixation of PMV and credit entitlement – Entire case based on wrong understanding of facts and law especially the understanding that DEPB benefit to be restricted to 20% - Impugned order holding that FOB value of export goods should have been declared at the price of goods in local market has no legal basis, set aside – DGFT PN dated 10/97 dated 21.05.1997, CBEC Circulars 69/97-Cus dated 08.12.1997, 27/2000-Cus dated 05.04.2000, 77/2002-Cus dated 27.11.2002 Penalty – When adjudicating officer himself is confused with regard to understanding of expression 'present market value', exporter cannot be penalized – No case warranting confiscation of goods under s. 113(d) made out for justifying levy of penalty under s. 114(i) and (iii), confiscation, fine and penalty set aside – Sections 113 and 114 of Customs Act, 1962


M/s Girnar Impex Ltd Vs CC, Amritsar (Dated : June 3, 2011)

Customs - DEPB - Allegation of mis-declaration and over-invoicing of export goods for claiming higher benefits under DEPB scheme - Investigations revealed that goods

actually exported were non alloy steel items based on recovery of parallel invoices from the briefcase of director of appellant-company - Incriminating evidences relied upon by lower authority to impose heavy penalties for fraudulently claiming DEPB benefits - No prima facie case for waiver of pre-deposit - Appellants engaged in direct fraud directed to deposit 25% of penalties - Suppliers of invoices who abetted in fraud by facilitating bogus invoices on commission basis were ordered to deposit Rs. 50 lakh each


M/s Hindustan Steel Industries Vs CCE, Kanpur (Dated : June 3, 2011)

Customs - Import of electric bicycles - Appellants claim for benefit of Notification No.21/02-Cus denied by lower authority on the ground that goods were in partially assembled condition and not in CKD condition - Goods alleged to have been imported at a port not notified and in contravention of Rule 126A of Central Motor Vehicle Rules which is a pre-condition as per import licensing note to Chapter 87 of ITC (HS) -Importer allowed to clear a sample of bicycle parts to ARAI, Pune for testing and obtaining certificate of compliance - Importer directed to transfer goods to a notified port at their cost by following procedure for transhipment from one port to another-Impugned order set aside and matter remanded to lower authority - No opinion expressed on eligibility of Notification No. 21/02-Cus - Notification No. 21/2002-Cus dated 01.03.2002 as amended


CC, New Delhi Vs M/s Semi Conductor Laboratory Deptt Of Space, Govt Of India (Dated : May 23, 2011)

Customs - Import - Refund - Remand Order - Finality of - The order of the Commissioner (Appeals) having achieved finality, the lower authorities are bound by it - It was not open to the original adjudicating authority to keep on rejecting the refund claims on the ground of non-challenge of assessment orders. (Para 10)


Shri Ram Chhordas Agarwal Vs CC, Lucknow (Dated :December 22, 2011)

Customs – Silver bullion, ornaments, cash and car carrying the same seized by customs officials – Appellant arrested and produced before magistrate before whom it was claimed that statements were recorded from him under duress – Appellant ultimately released on bail by Allahabad High Court – Immediately after release, appellant retracted his confessional statement – SCN issued proposing confiscation of silver bullion, ornaments, cash and car confirmed by lower authorities but set aside by Tribunal on the ground that confessional statement was retracted and cannot be a basis for confiscation and penal proceedings – Revenue appeal to High Court resulted in remand back to Tribunal holding that burden to prove innocence was on the alleged smuggler and Tribunal's order was perverse and liable to be set aside – In terms of s. 123 (1) of Customs Act, 1962, where any goods to which this section applies are seized in the reasonable belief that the same are of smuggled origin, the burden of

proving that they are not of smuggled origin shall be on the person from whose possession the same were seized – Since this section provides for presumption regarding smuggled nature of goods notified in this section seized from a person, this presumption is a rebuttable presumption and once the person produces some evidence indicating their legal import, the burden would shift to department – Once the appellant, immediately after his release on bail, produced evidence in support of legal origin of silver under seizure, the burden of proof shifts to the department and department did not produce any evidence to rebut appellants plea regarding legal origin of silver – Statement of seizing officer before magistrate lends credence to appellants allegation that he had been illegally detained and in view of judgment of Supreme Court in Vinod Solanki vs. Union of India - 2009-TIOL-01-SC-FEMA , the correctness of his confession would become doubtful, as the same would be hit by section 24 of Indian Evidence Act, 1872 – Merely on the basis of a confessional statement (which is of doubtful nature) confiscation of silver bullion, cash, car etc not sustainable – Impugned order set aside


CCE , Rohtak Vs M/s Sai Sales Corporation (Dated : November 21, 2011)

Customs Valuation – Rejection of Transaction value : during the period of dispute i.e. during the period prior to 10.10.07, as per the provisions of Section 14 of Customs Act, 1962 read with Customs Valuation Rules, 1988, as the same stood during that period, for rejecting the declared transaction value, either concrete evidence to prove that the conditions as provided in Rule 4(2) of Valuation Rules are not satisfied or as per the provision of Rule 10 A material evidence to doubt the declared transaction value must be produced and only in such a situation, the burden to prove the correctness of the declared transaction value will shift to the importer and if he is not able to discharge the burden of proof, the preponderance of probability in support of allegation of the transaction value not being true and correct will be treated as having been established. Mere difference between the declared transaction value and price of contemporaneous imports of similar/identical goods is not sufficient for rejecting the declared transaction value-for rejecting the declared transaction value, it must be proved with cogent evidence that the difference is due to the conditions of Rule 4(2) not being satisfied or due to existence of reasons for doubting the declared value which would justify invoking Rule 10A . [ par 6.2]


M/s Kerala State Electricity Board Vs CC, Cochin (Dated : August 5, 2011)

Customs – Import of special tools by KSEB – Refund claim of excess duty paid against short shipment of goods filed within one year in terms of section 27(1)(a) of Customs Act, 1962 – Claim rejected on the ground that KSEB is not Government but merely a Government undertaking and limitation of six months applies - When government has notified KSEB as state transmission utility under Electricity Act, 2003 and granted transmission license, such utility cannot be regarded as government, limitation of six months applies - No merit in appeal - Section 27(1)(a) of Customs Act, 1962 read with Electricity Act, 2003 and Electricity Supply Act, 1948


M/s A G International Vs CC, Allahabad (Dated : September 19, 2011)

Customs – Smuggled Goods – Onus to prove heavily on revenue : The onus to prove that the goods in question are of smuggled goods, lies heavily on the revenue as though the fabrics made wholly or mainly of synthetic yarn and covered by Section 123 of Customs Act, 1962, in absence of any foreign marking on the goods or any other evidence indicating that the goods of smuggled origin, there is no basis for exercising reasonable belief that the same are goods smuggled and therefore the provisions of Section 123 can not be invoked. The said onus is required to be discharged by adducing positive and concrete evidence and not on the basis of doubts, assumptions and presumptions. In the present case, there is nothing to prove that fabrics in question are of foreign origin just because the appellant in their sale invoice were mentioning the goods as imported velvet, the same cannot be treated as of foreign origin. No reasons to confiscate the fabrics or to impose penalty on the appellants.


CC, Kandla Vs M/s Adani Exports Ltd (Dated : November 29, 2011)

Customs - Import of Cotton Seed Oil (Edible grade) by claiming benefit of duty exemption under Notification No. 20/99-Cus - Bills of Entry which were provisionally assessed were stamped as finally assessed on 25.05.2001 - In such a scenario, claim of Revenue that rate of duty and total amount was yet to be changed on the basis of test results, under the impression that late charge has already been given and confirmed, amounts to misreading provisions of Customs Act, 1962 - Assessment of Bill of Entry is an appealable decision under provisions of Customs Act, 1962 - If Bills of Entry were indicated as finally assessed and there being no change in rate of duty as well as amount of duty, there cannot be any presumption that Bills of Entry were provisionally assessed and remained to be provisionally assessed - No legal infirmity in order of Commissioner (Appeals) setting aside order of lower authority - Revenue appeal devoid of merits - Section 18 of Customs Act, 1962



M/s Metal Plast Exim (India) Ltd Vs CC, Kandla (Dated : December 15, 2011)

Customs – Refund of fine consequent to the favourable order of the Tribunal – Claim for interest rejected by revenue on the ground that the refund is not covered under Section 27 of the Customs Act, 1962 and by relying on the order of Tribunal in case of Calcutta Iron & Steel Company vs. CCE Chennai - In view of the fact that the decision of the High Court of Himachal Pradesh and of the Tribunal allowing interest were not cited before the Tribunal while contesting the issue in Calcutta Iron & Steel Company case and the order was passed without noting these contrary decisions or distinguishing the facts, the ratio of the same cannot be followed – Appellant is entitled for interest.


M/s Virchow Laboratories Ltd Vs CCE & CC, Hyderabad (Dated : August 17, 2011)

Customs – Refund – Refund of excess anti-dumping duty paid granted pursuant to Tribunal's Final order with interest – Refund claim filed for interest on delayed payment of interest – Interest on delayed payment of interest not permissible as held by CESTAT Larger Bench decision in Sun Pharmaceuticals Industries Ltd - 2005-TIOL-558-CESTAT-DEL-LB – LB decision equally applicable to Customs Act and/or rules made thereunder – Section 27A of Customs Act, 1962


M/s Bengal Export Corpn Vs CC, Kolkata (Dated : September 13, 2011)

Customs - Classification - Importer declared consignment as heavy melting scrap falling under CSH 7204 whereas on examination it was found to be old and used pipes classifiable under CSH 7304 - Goods confiscated and allowed for redemption on payment of fine and penalty on the ground that old and used pipes imported without valid license under FTP - Contention of importer that CSH 7304 covers only new pipes and not old pipes not acceptable - Once appellant-importer accepted the classification at original adjudication stage, appellant cannot change stand subsequently since department would not be in a position to conduct any investigation or verification at that stage - Impugned goods are not covered by Para 2.17 of Foreign Trade Policy, which allows free import of goods since this paragraph does not cover goods under CTH 7304 - As it is a question of interpretation as to whether used and old pipes can be considered as heavy melting scrap or not and appellant has gone by the description in the invoice of supplier, charge of mis-declaration not sustainable -Confiscation upheld, redemption fine reduced to Rs. 35,000/- and penalty reduced to Rs. 10,000/- - Para 2.17 of EXIM Policy read with section 111(d) of Customs Act, 1962


Smt Salma Shakil Vs CC (Preventive), Lucknow (Dated : September 29, 2011)

Customs - CHA Licence - Licence rejected on the ground that the applicant is only a graduate and does not have a professional degree as mentioned under Regulation 6(a) of the CHALR 2004 - Since the applicant had passed the examination under CHALR 1984, clarification given by the CBEC vide Circular No 25/2011 Cus would apply - If the appellant have passed the examination in the additional subjects, she will be deemed to have passed the examination under Regulation 8 of CHALR-04 - The Commissioner's other objection that an applicant who had passed examination from one Custom House cannot be considered for the grant of CHA licence from another Customs House is without any basis - The matter is remanded for denovo decision.


M/s Amarnath Jhujnjhuwala Vs CCE, Amritsar (Dated : October 21, 2011)

Customs - Import of Raw Silk from China and eligibility of Notification No. 38/96-Cus -Goods confiscated subject to payment of redemption fine and penalty on the ground that benefit of said notification available only to local persons residing along the border - Ratio of CESTAT judgment in Krishna Singh Garbyal case followed 2011-TIOL-1454-CESTAT-DEL - Commissioner referred to and relied upon the same MOU between India and China, Circulars and Clarifications issued from various field formations - CESTAT in Krishna Singh Garbyal case ibid held that MOU, Circulars/Clarifications cannot lay down restrictions contrary to normal wordings of Notification - Wordings in the notification nowhere puts any restriction to import of raw silk through the impugned route - Benefit of Notification not deniable - Impugned orders set aside - Notification No.38/96 Cus dated 23.7.1996


CC, New Delhi Vs M/s Bharat Hotels Ltd (Dated : September 21, 2011)

Customs - Penalty - Import of smart card (part of door lock) by declaration of lower assessable value based on wrong value mentioned in commercial invoice - Supplier apologized for mistake and affirmed correct value of consignment - As there was no malafide on the part of importer, penalty imposed under section 112(ii) of Customs Act, 1962 set aside by Appellate Commissioner - Though question of mens rea not relevant for levy of penalty under section 112, it is relevant for quantum of penalty -A token penalty would serve interest of justice, penalty enhanced from NIL to Rs. 1000/- Appeal of Revenue disposed of - Section 112 of Customs Act, 1962


M/s Bentley Systems India Pvt Ltd Vs CC, New Delhi (Dated : April 20, 2011)

Customs – Valuation – Import of computer software by importer where importer is a related person to foreign supplier – Based on directions of department, appellant paid duty on the basis of transfer price agreed between foreign supplier and appellant after making a deposit of 1% of AV based on transaction price from May 2006 to January 2007 and a deposit of 5% thereafter – No evidence produced by department regarding price for sale at the same commercial level and same quantity level – No merit in Revenue's argument that goods imported by a distributor should be assessed on the basis of list price for retail sale – Rules 2(2), 3(3), 4(2) of Customs Valuation (Determination of Price of Imported Goods) Rules, 2007

Customs – Valuation – Whether any addition has to be made on account of Corporate service charges being paid by importer to parent company-supplier located abroad –Once Transfer Price Agreement for products or services is not objected to by Income Tax Department a case that the value of goods has been transferred to service has to be proved with more meaningful evidence rather than a comparison with list price for sale to retail buyers especially when evidence exists for discounts given even to retail buyers – No case made out by Revenue that CSC payment is disproportionate to any reasonable estimate of cost of such services – Order of lower authorities set aside –This order shall not be a bar for making out a proper case against importer on the basis of demonstrable evidence that the price of imported goods has been transferred to services – Rules 2(2), 3(3), 4(2) of Customs Valuation (Determination of Price of

Imported Goods) Rules, 2007

Service tax on corporate service charges – Services availed by importer from its holding company, for which CSC is paid, are likely to be chargeable to service tax under section 66A of Finance Act, 1994 and it is open to the Customs authorities to notify the service tax authorities concerned for taking action as permitted under law for recovery of service tax if not already paid


M/s Bentley Systems India Pvt Ltd Vs CC, New Delhi (Dated : April 20, 2011)

Customs – Valuation – Import of computer software by importer where importer is a related person to foreign supplier – Based on directions of department, appellant paid duty on the basis of transfer price agreed between foreign supplier and appellant after making a deposit of 1% of AV based on transaction price from May 2006 to January 2007 and a deposit of 5% thereafter – No evidence produced by department regarding price for sale at the same commercial level and same quantity level – No merit in Revenue's argument that goods imported by a distributor should be assessed on the basis of list price for retail sale – Rules 2(2), 3(3), 4(2) of Customs Valuation (Determination of Price of Imported Goods) Rules, 2007

Customs – Valuation – Whether any addition has to be made on account of Corporate service charges being paid by importer to parent company-supplier located abroad –Once Transfer Price Agreement for products or services is not objected to by Income Tax Department a case that the value of goods has been transferred to service has to be proved with more meaningful evidence rather than a comparison with list price for sale to retail buyers especially when evidence exists for discounts given even to retail buyers – No case made out by Revenue that CSC payment is disproportionate to any reasonable estimate of cost of such services – Order of lower authorities set aside –This order shall not be a bar for making out a proper case against importer on the basis of demonstrable evidence that the price of imported goods has been transferred to services – Rules 2(2), 3(3), 4(2) of Customs Valuation (Determination of Price of Imported Goods) Rules, 2007

Service tax on corporate service charges – Services availed by importer from its holding company, for which CSC is paid, are likely to be chargeable to service tax under section 66A of Finance Act, 1994 and it is open to the Customs authorities to notify the service tax authorities concerned for taking action as permitted under law for recovery of service tax if not already paid


M/s Khanna Paper Mills Ltd Vs CC, Amritsar (Dated : April 21, 2011)

Customs – Demand of duty, imposition of redemption fine and penalty based on allegation of mis-declaration of export goods and wrongly obtaining DEPB scrips from DGFT – Appellant exported writing and printing paper in rolls and reels claiming DEPB benefit against Entry 459B of DEPB Schedule – DEPB scrips issued to exporter by DGFT for duty free imports after exports were allowed after examination of goods by customs – Amendment in DEPB Schedule S. No. 459B made only with effect from 27.01.2006 and the same not applicable to exports prior to that date – Department has not made out a case that DEPB scrips were forged and not issued by DGFT – No

dispute that clarification was sought by department from DGFT and DGFT clarified that exports made by appellants prior to 27.01.2006 were eligible for benefit of DEPB under S. No. 459B – When valid DEPB scrips were used for duty free imports, no reason for sustaining demand of duty, confiscation of goods and imposition of penalty – Impugned orders set aside – Sections 28, 111(o), 113(i), 114, 114A, 125 of Customs Act, 1962


M/s J S Designer Ltd Vs CC(ICD), New Delhi (Dated : December 8, 2011)

Customs – Export of fabrics under claim of DEPB – Value declared suspected by the revenue and export allowed after execution of bond with bank guarantee of Rs 2 crores – The appellant realized the export proceeds and the claim of DEBP was pending with the department - Directions of the adjudicating authority to further execute bank guarantee of 25% of the value of subsequent consignment is harsh and unjust - Taking into account the overall facts and circumstances of the case, earlier bank guarantee of Rs. 2 crores executed by the appellant should be considered as sufficient to cover the subsequent consignment also - There is no need to give further bank guarantee as directed by the Commissioner - The appellant is directed to furnish a bond for an amount equal to the value of goods and letter from the bank to the effect that the bank guarantee already executed will cover the dispute about the subsequent shipment also and the same would be kept alive.


CC, New Delhi Vs M/s Venus Traders (Dated : May 26, 2011)

Customs – Valuation – Enhancement of value of worn clothings based on contemporaneous imports – No error in the order of Commissioner (Appeals) holding that there cannot be any identical nature of the goods or similarity in the goods imported under two consignments when the goods are old and used clothings –Revenue's appeal rejected.


M/s B E Office Automation Products Pvt Ltd Vs CCE, Delhi (Dated : December 14, 2011)

Customs - Import of old and used parts of photocopiers - Parts of used photocopiers cannot be treated as capital goods for the purpose of para 2.17 of the import policy and import of same requires licence - Confiscation upheld - There is no justification for increasing the penalty to about 61% and 24% of the assessable value approved - Fine and penalty reduced to Rs.1,25,000/- and Rs.50,000/- respectively.


CC & CE,Tirupathi Vs M/s Lanco Industries Ltd (Dated : August 2, 2011)

Customs – Import of Low Ash Metallurgical Coke for manufacture of Pig Iron claiming benefit of exemption from anti-dumping duty and benefit of concessional rate of duty under Notification No. 17/2007-Cus – Concessional rate available subject to following procedure under IGCRDMEG Rules, 1996 – Investigations disclosed that 8184 MTs not fed into blast furnace for manufacture of Pig Iron resulting in demand of differential duty by denial of duty exemptions – Original authority allowed operating losses in r/o LAM Coke and losses upto 7% in r/o coke fines while demanding duty in excess of 7% loss – Order of original authority upheld by lower appellate authority resulting in Revenue appeal – Words "for use" used in the relevant notification to be construed to mean "intended for use" as held by Apex Court in BPL Display Devices Ltd (2004-TIOL-121-SC-CUS) – Benefit of Notification deniable to importer only where they divert any part of imported goods – Findings of original authority to the effect that 8184 MTs of LAM Coke was imported for intended purpose of manufacturing Pig Iron and which was upheld by lower appellate authority conspicuously unchallenged by Revenue – Notification No. 17/2007-Cus read with IGCRDMEG Rules, 1996


M/s John Deere Equipment Pvt Ltd Vs CC, Goa (Dated : October 3, 2011)

Notification 52/2003-Cus – assessee, a 100% EOU - in respect of re-import, appellant filed BE for clearance of returnable racks to be used as packing material for export of tractors – though at the time of re-importation, the said goods were not specified in the Letter of Intent issued by Development Commissioner, the same were incorporated by an addendum – in terms of para 2.26 of the EXIM Policy the appellant was rightly entitled for duty exemption - Merely because the appellant did not have the exemption certificate when the BE was filed, duty exemption could not have been denied to the appellant when the certificate was produced later – appeal allowed with consequential relief: CESTAT.

EOU is a custom bonded warehouse where goods are to be deposited and used without /payment of customs duty - Since returnable racks are used for the packaging of tractors which are exported, the movement of the goods from the port of import to 100% EOU is in fact movement under bond wherein duty payment is not required -Therefore, denial of customs duty exemption to the appellant on the said returnable rack under Notification No. 52/2003-cus dated 31.3.2003 is totally incorrect.


M/s Kamal Sehgal Vs CC, New Delhi (Dated : September 14, 2011)

Customs - Import - Smuggling - CHALR, 2004 - Suspension of CHA License - License of CHA has been suspended as he has been helping behind the scene in smuggling and such persons cannot be trusted to be a Customs House Agent.

HELD - Suspension is normally done to ensure that the CHA does not misuse his position, having access to Customs area to destroy evidence if any, and also to be on guard about his actual involvement that may be unearthed during investigation. As a show cause notice has been issued for revocation of license, the said reasons no longer exist. There is delay in complying with time frame prescribed by CBEC in

Circular No.9/2010 dated 8.4.2010. Considerable time has lapsed after the suspension order. Also, there is no procedure prescribed for periodic review of suspension order which is confirmed after post decisional hearing. Considering all these aspects, the impugned order suspending the license of the CHA is set aside. (Para 8)


CCE, Mumbai Vs Adlab Films Ltd (Dated : September 27, 2011)

ROM application filed by Revenue alleges grievous error – applicant has misconceived the facts inasmuch as in para 2 submissions made by appellant are recorded and findings of the Bench have been recorded in para 4 which have not been gone through – ROM dismissed. [para 3]


Murli Industries Ltd Vs CC, Nagpur (Dated : October 20, 2011)

Imported waste paper – applicant manufactured news print out of waste paper and the off-cut side edges were sold and used other than as “Newsprint” - Whether entitled for benefit of notification 21/2002-Cus – since in case of Ellora Paper Mills Ltd. vs. CCE - 2010-TIOL-379-CESTAT-MUM Bench has granted unconditional waiver of pre-deposit, same followed in the present case also – Application allowed. [para 5]


M/s Satkar Enterprises Vs CCE, Ludhiana (Dated : June 1, 2011)

Customs - Import - Service of Order-in-Original - Date of receipt - Limitation in filing appeal - The order-in-original is dispatched by speed post and also pasted on the front door of the factory, when the factory itself was admittedly closed since the last three years. The residential address of the director was available with the Revenue. In fact the letter for recovery was sent to the assessee's residential premises. In such a scenario, when the factory was found to be closed, the impugned order could have been served to the assessee's director at their residential premises. Hence, without going into the actual date of receipt of the order-in-original the delay in filing appeal is condoned. (Para 3 & 4)

Personal Hearing - Non-receipt of notice for personal hearing - Non-submission of reply - Undisputed fact on record is that the impugned order stands passed by the Commissioner without there being any defence reply on record. Further though the Commissioner has fixed a number of personal hearing dates and has made efforts to serve the said notices to the appellant but the fact remains that no hearing notice was received by the assessee and as such the impugned order stands passed without hearing the appellant in person. In the interest of justice the matter is remanded to Commissioner for fresh decision. (Para 8)


CC, Cochin Vs M/s Sagar Enterprises (Dated : August 12, 2011)

Customs - Import of used photocopies without license under FTP - Original authority enhanced values based on CE certificate and imposed redemption fine and penalty -Duty paid on enhanced values without contest - Redemption fine and penalty reduced by Appellate Commissioner - No infirmity in order of Appellate Commissioner to reduce fine and penalty exercising his discretionary powers - In the facts and circumstances of case, reduction of fine and penalty not unreasonable or arbitrary -No valid reason adduced to interfere with order of Appellate Commissioner


M/s Panna Lal Banarasi Das Vs CCE, Jaipur (Dated : November 22, 2011)

Customs - Seizure of Gold: Burden of Proof : primary gold is one of the specified item in terms of the provisions of Section 123 of the Customs Act, 1962. As such, the onus to prove that the seized gold biscuits are legally imported biscuits is upon the person from whose possession the same are recovered or upon the person who claims the ownership of the same. {Para 11}

Smuggled Gold : conclusion as to whether the gold in question is smuggled or not has to be arrived at based upon the appreciation of the evidence available in each and every case. The appellants in the present case have been trying to cover the transaction with three sale vouchers. Having examined the authenticity and genuineness of the said three vouchers, the same cannot be held to be covering the transaction in question. As such, the adjudicating authority have rightly rejected the said evidence. Further, there being no other evidence produced, held that the appellants have not been able to discharge the onus placed upon them showing the legal importation of the gold in question. Consequently, it is held that gold biscuits in question are smuggled. { para 16}

Redemption : in the case of any imported goods (other than gold) seized for the reason that the goods are not covered by proper import licence, option to redeem the confiscated goods on payment of a redemption fine is normally given except in cases where the goods may cause injury to society at large, may interfere with the public policy, may cause threat to security of the nation, etc. The nature of the prohibition and the nature of the goods have to be taken into account while exercising such discretion. There can be no such reason for absolute confiscation of gold after liberalised policy for its import has came into force since 1991. It is also to be noted that in this case the seizure is not at the point of import, where there is higher onus on the importer to give proper declaration and to comply with import restrictions and to pay applicable duties. {Para 20}


CC, New Delhi Vs M/s Chandra Prabhu International Ltd (Dated : June 3, 2011)

Customs – Refund of Anti-dumping duty paid under protest – Revenue seeks to reject the refund on the ground that the assessed bill of entry was not challenged by the importer – Held: No infirmity in the order of the Commissioner (Appeals) holding that the provisions of Customs Act do not apply to the refund of anti-dumping duty -Merely because the original adjudicating authority has not dealt with the applicability of Customs Act, it cannot be said that the same was not the issue to be decided - The Commissioner (Appeals) has come to a clear finding that the provisions of the Customs Act do not apply to the refund of the anti-dumping duty - By paying duty under protest, the respondents have put their seal of disapproval to the fact of payment of duty – Revenue appeal has no merit - Section 9A(2) of the Customs Tariff Act, 1975


Hindustan Lever Limited Vs CC, Mumbai (Dated : October 7, 2011)

Once advance licences are issued as per the input/output norms by the competent licensing authority, the question of denial of customs duty exemption on goods imported under the advance licences cannot arise unless any of the conditions of exemption is violated: the licensing authority has not questioned the appellant with regard to the usage of various items in the manufacture of export products and have issued advance licences in accordance with the standard input/output norms prescribed in the policy. Once advance licences have been issued for a given quantity and for a given value, the Customs cannot deny benefit of Customs duty exemption in respect of such quantity and value of import on extraneous grounds for which they have no jurisdiction to investigate. Therefore, so long as the terms and conditions of advance licences have not been violated by the appellant, the benefit of customs duty exemption under the aforesaid notifications cannot be denied or withheld.

Whether once the licensing authority certified that export obligation has been fulfilled whether such certification is final and binding on the Customs authorities ?: the licensing authority has accepted the fulfillment of export obligation and have issued export obligation discharge certificates and have discharged the appellants from any further obligation. That being the position, the Customs authorities cannot deny the benefit of Customs duty exemption under the notifications governing the advance licensing scheme. If at all they felt that the appellant had violated any of the terms and conditions of the licences, they should have referred the matter to the licensing authority for appropriate action rather than taking action suo motu.

Appellant's eligibility to import crude Palm Stearine under the advance licences and consequent eligibility for Customs duty exemption thereon : crude palm stearine did not satisfy the definition/criterion of 'material' which were permitted to be importedduty free both under the EXIM policy and the relevant customs notifications. The material imported should be capable of being used in the manufacture of the export product. Crude Palm Stearine did not also satisfy the criterion stipulated in the customs notification that "the materials are required for the manufacture of export product". Therefore, Crude Palm Stearine was not eligible for customs duty exemption and therefore, the demand of customs duty on the said goods confirmed in the impugned order is sustainable in law.

Limitation - Bond : The question of time bar in this case will not arise for the reason that the duty demand is raised in terms of the bond and letter of undertaking executed by the importer appellant with the customs authorities. In terms of the said bond/LUT, there is an obligation on the part of the appellant to fulfill the terms and conditions of import, which we have already held that the appellant has not fulfilled. The bond/LUT executed with the customs has not been discharged and therefore, duty demand can be raised at any time before the bond is discharged. Since the duty demand is sustainable, the liability to pay interest thereon is automatic and

consequential. Therefore, the appellant is liable to pay interest on the duty demand in terms of the bond/LUT executed by them at the appropriate rates. Since the appellant has failed to fulfill the terms and conditions of the relevant customs notification in respect of the end use specified therein, the quantity of crude palm stearine is liable to confiscation under the provisions of section 111 (o) of the Customs Act, 1962. Consequently, the appellant would be liable to penalty under section 112(a) of the Customs Act, 1962. Since the crude palm stearine was allowed to be cleared in terms of the bond executed with the customs, in lieu of confiscation, redemption fine under section 125 of the said Customs Act can also be imposed.

Customs authorities have no jurisdiction to decide the matter with regard to the eligibility of credit under the DEPB scheme: it is for the licensing authority to decide whether any particular export qualifies for the DEPB scheme or not. The Customs authorities, at best, can bring to the notice of the licensing authority the factual position and it is for the licensing authority to decide whether the export would qualify for the DEPB benefits or not. The Customs, on their own cannot decide upon the issue of eligibility to DEPB benefits of exports made by an exporter.

Customs authorities cannot demand import duty on the inputs imported duty free and which have been used in the manufacture of export product on which DEPB credit is claimed : When the scheme itself permits that the materials imported in excess of actual use can be used in the manufacture of other goods which may be sold in the domestic market by the manufacturer himself, there can not be any objection to the export of the manufactured product also. No doubt, there is a mis-declaration when the exports are made under claim for DEPB. In such cases, what is legally possible is to deny the DEPB credit on such exports and not denial of exemption under customs notifications relating to DEEC. Such action for denial of DEPB credit can be taken only by the DGFT authorities and the customs have no jurisdiction in that matter. For a violation in respect of exports made under DEPB scheme, action has to be taken under that scheme itself and it does not stand to reason that action can be taken under DEEC scheme when no violations have been committed with respect to that scheme.

Penalty on General Manager: Since the bulk of the duty demand on the appellant has been held to be not sustainable and in view of the fact that he did not stand to benefit personally in respect of the transactions involved, and also considering the fact penalty is imposed on the appellant firm, penalty on the General manager is not warranted in the facts and circumstances of the case.



M/s Gujarat Boron Derivatives Pvt Ltd Vs CC, Ahmedabad (Dated : October 10, 2011)

Customs Refund Denial of benefit under Notification No. 102/07-Cus for refund of SAD on the ground of unjust enrichment Board Circular No. 18/2010-Cus clarifies that field formations shall accept Chartered Accountant's Certificate for satisfying that there was no unjust enrichment Circular also clarifies that there is no requirement to scrutinize balance sheet and P & L A/c to ensure that there was no unjust enrichment Board Circular applies retrospectively from 2007 and not prospectively from current financial year as held by Appellate Commissioner In the instant case, since the certificate was produced by statutory auditor it cannot be said that they were unaware of records maintained by appellant CA Certificate clearly shows that importer has not collected SAD directly or indirectly, refund not deniable Notification No. 102/2007-Cus dated 14.09.2007


Cantronics Office Equipment Pvt Ltd Vs CC, Mumbai (Dated : November 17, 2011)

Barcode Printer imported for sale in Shopping Malls – Shopping Mall or Stockist cannot be regarded as Institutional Consumer – they are also not similar to service industry or akin to a transporter or hotel as defined under rule 2A of the SWAM Rules, 1977 –Retail sale price is required to be declared on package and Additional duty of Customs to be calculated based thereon: CESTAT [ para 6 ]



CC, Jamnagar Vs M/s Atlantic Shipping Corporation (Dated : September 20, 2011)

Customs – Refund arising out of finalization of assessment of ship's bunkers and tools whether attracts provisions of unjust enrichment – Bar of unjust enrichment not attracted for period prior to amendment of section 18 of Customs Act on 13.07.2006 –No infirmity in impugned order of Appellate Commissioner


M/s Reco Industries Vs CC, New Delhi (Dated : September 7, 2011)

Customs - Export - Drawback - Readymade garments found to be rags - Evidence on record and the statement of the Managing Director corroborate that the goods attempted to be exported are rags and the value thereof is less than the claim of drawback. Hence, denial of drawback upheld. However, redemption fine and penalty reduced. (Para 4)


M/s Marathon Traexim Ltd Vs CC, Visakhapatnam (Dated : June 30, 2011)

Customs – Import of betel nuts (areca nuts) from Bangladesh and eligibility of exemption @ 60% of applied rate of duty under Notification No. 105/99-Cus –Department applied exemption @ 50% of applied rate holding ‘areca nuts' as covered under Part A of said Notification while rejecting importers claim that impugned goods are covered under both Part A and Part B thereof – When impugned goods are covered by two exemptions, assessee entitled to benefit of that exemption which provides greater relief – Apex Court judgment in India Petrochemicals = 2002-TIOL-662-SC-CX followed – Impugned order held unsustainable, set aside – Customs

Exemption Notification No. 105/99-Cus dated 10.08.99 as amended by Notification No. 13/03-Cus dated 20.01.03


M/s IDBI Bank Ltd Vs CC, New Delhi (Dated : June 3, 2011)

Customs – Penalty under Section 114 of the Customs Act, 1962 imposed on Bank and the employee of the Bank for carelessness in accepting the currency declaration form (CDF), in connection with the case of claiming export benefits fraudulently using fake CDFs – The finding against the employee is one of carelessness and failure to perform his duties - These might constitute facts to institute departmental proceedings against him, but these facts are not adequate to constitute an offence under section 114 of the Customs Act – Penalties on Bank and the employee set aside.


M/s Baheti Metals & Ferro Alloys Ltd Vs CC, Kandla (Dated : September 16, 2011)

Customs – Stay/Modification of order of pre-deposit – Tribunal has inherent powers to modify stay orders under Rule 41 of CESTAT (Procedure) Rules, 1982 – Order of Bombay High Court in Sarla Performance Fibers Ltd 2008-TIOL-783-HC-MUM-CX and Judgment of Apex Court in Benara Valves Ltd = 2006-TIOL-156-SC-CX followed –Condition imposed in stay order modified – Pre-deposit waived and in lieu of this applicant directed to pledge his residential bungalow worth 6.28 crores – Appellant directed to submit all original documents relating to the property to be kept in custody of Assistant Registrar, CESTAT – Failure to comply with this order or if any document is proved to be wrong/illegal, appeal liable for dismissal itself – Stay order stands modified to this extent – Order not to be quoted as a precedent – Section 35F of Central Excise Act, 1944 read with Rule 41 of CESTAT (Procedure) Rules, 1982



M/s Keshodwala Steels Vs CC, Ahmedabad (Dated : October 4, 2011)

Customs - Export/Import - Ship with the consignment of goods meant for export grounded near Veraval port and got damaged - Appellant purchased the cargo from Insurance company and import duty was demanded from the appellant - Held: The appellant has not produced any proof to substantiate their claim that the ship had not crossed Indian territorial waters - It is also not in dispute that the original exporter had been given all the export benefits under DEEC scheme which establishes that the export had taken place in which case, the clearance of the goods from customs at the time of re-import have to be considered as import of the goods - Demand of duty upheld.

Valuation - Since there is no challenge by revenue against the order of Commissioner (Appeals) holding that the value at which the goods were sold to the appellant by the Insurance Company has to be treated as assessable value, duty has to be re-quantified accordingly.