2021-TIOL-111-HC-KAR-CUS
CC Vs Motorola India Ltd
Cus - Respondent imported components for manufacture of pagers under the Duty Exemption Entitlement Certificate scheme in terms of Notification No.30/97-Cus read with para 7.4 of EXIM Policy 1997-2002 - Licencing Authority had permitted the respondent to import quantities to the extent of 2% in excess of their actual requirement in respect of 13 out of 16 types of components towards wastage etc. during the process of manufacture of pagers - The respondent fulfilled the export obligation, however, it was not able to utilize some of the components imported under the scheme and closed down its messaging products division before April 2001 - Due to the closure, some of the imported components were rendered obsolete and, therefore, were written off in books during the financial year ending 31.03.2001 - A SCN was issued to the respondent requiring it to show cause as to why customs duty to the tune of Rs.96,17,498/- should not be demanded from it in terms of Notification No.30/1997-Cus and also show cause as to why duty free imported raw material be not confiscated and interest and penalty be not recovered from respondent - Adjudicating authority upheld the proposals made in the SCN and in the assessees appeal, Tribunal by order dated 12.05.2006 inter alia held that the respondent had fulfilled its export obligation and it was not obligatory on the part of the respondent (importer) to account for the wastage permitted - Aggrieved, Revenue is before the High Court.
Held: Tribunal on the basis of advance licences issued to the respondent and the Standard Input Output Norms (SION) has recorded a finding that the respondent was allowed to import 2% in excess to provide for the wastage - It is also pertinent to mention that since the respondent was allowed to import 2% in excess of their actual requirement, it is the case of the respondent that some of the components remained unutilized due to closure of messaging products division as the components were rendered obsolete - Admittedly, the respondent has fulfilled the entire export obligation and has realized the foreign exchange and has neither diverted the import material nor has sold it and has used all the imported materials - It is pertinent to mention here that the provisions of the Income Tax Act, 1961, permit the respondent to write off the unused assets - Therefore, clause (vii) of the Notification 30/1997-Cus has to be read in the context of the legal provisions and cannot be read in isolation - The word 'any manner' therefore, cannot include within its ambit written off duty free imported material in the books specially when the same was in the custody of the respondent itself as writing off of the same is permissible in law - Therefore, the contention of the revenue that provision or clause (vii) of the Notification 30/1997-Cus was violated does not deserve acceptance - The substantial questions of law involved in this appeal are answered against the revenue and in favour of the assessee - Mo merit in this appeal, hence the same fails - Revenue Appeal is dismissed: High Court [para 6, 7]
- Appeal dismissed : KARNATAKA HIGH COURT
2021-TIOL-108-HC-MUM-CUS
Ira Edutech Pvt Ltd Vs UoI
Cus - Petitioner has imported consignment of electric motorcycle in complete knock down condition vide Bill of lading dated 15.01.2020; Bill of Entry dt. 13.02.2020 and claimed benefit of notification No. 50/2017-Customs, dated 30.06.2017 as amended - Respondents examined the imported goods to the extent of 10% and found that pre-assembled and dis-assembled battery packs and electric compressions were missing from the consignment - This was explained to by the petitioner by stating that those being hazardous components, foreign seller would dispatch the said goods by air shipment - Subsequently, respondents subjected the imported goods to 100% examination - imported goods have not been released despite request by the petitioner for provisional release of the goods, therefore, present writ petition has been filed seeking a direction to the respondents for clearance of the imported goods under section 18 of the Customs Act, 1962 read with the relevant provisions of the Customs (Provisional Duty Assessment) Regulations, 2011 - Stand taken in the affidavit by respondent is that the said imported goods have been finally assessed on 20.11.2020 levying basic customs duty @ 50% thus denying the concessional rate sought for by the petitioner in terms of the notification No. 50/2017-Cus on the ground that the consignments were incomplete in terms of the bill of lading - It is contended that once order of assessment has been passed, the same being an appealable one, petitioner can avail his remedy by filing appeal before the Commissioner of Customs (Appeals) - Petitioner submits that writ petition was filed on 10.11.2020 and it was thereafter that the assessment order was passed. Held: Balancing the interest of the two sides, Bench directs that the goods imported by the petitioner vide bill of entry dated 13.02.2020 be released for home consumption on payment of 25% of the basic customs duty and on furnishing bank guarantee of a nationalized bank for the remaining amount before respondent No. 3 as per assessment made - that on complying with the aforesaid requirements, respondents shall release the goods of the petitioner forthwith - Stand over to 16.03.2021: High Court [para 9, 10]
- Matter listed: BOMBAY HIGH COURT
2021-TIOL-107-HC-KERALA-ST
Nattakam Service Cooperative Bank Ltd Vs Supdt. of CT & CE
ST - Considering the fact that the appeal is a statutory appeal and the same is only rejected because of non-deposit of the amount required for entertaining the appeal as per provisions of Section 35F of the Finance Act, 1994, Bench is of the considered opinion that one more opportunity needs to be granted to the petitioner for depositing the amount as required by Section 35F of the Finance Act for entertaining the statutory appeal on merits - Impugned order of rejection of the appeal is quashed and set aside - The petitioner is permitted to deposit the amount as envisaged by Section 35F of the Finance Act, 1994 towards pre-deposit for entertaining his statutory appeal, said amount be deposited within a period of one month and upon deposit of the same, appellate authority shall consider and decide the appeal afresh in accordance with law - Petition disposed of: High Court [para 6, 7]
- Petition disposed of: KERALA HIGH COURT
2021-TIOL-106-HC-AHM-ST
Gujarat Technological University Vs UoI
ST - Writ Applicant seeks quashing and setting aside of order dated 30.07.2020 passed by the Commissioner of CGST & CEX, Ahmedabad - One of the contentions raised in this writ application is with regard to the discrimination being violative of Article 14 of the Constitution and since this aspect may not be appreciated or may not fall within the jurisdiction of the Appellate Authority, the writ applicant has thought fit not to file the statutory appeal, but come before this High Court by invoking its writ jurisdiction under Article 226 of the Constitution. Held: Bench notes that the impugned order is an appealable order and an appeal under Section 86 of the Finance Act, 1994 lies before the Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad - Bench is of the opinion that it should not entertain this writ application as the writ applicant has an alternative remedy of filing a statutory appeal against the impugned order-in-original under Section 86 of the Finance Act, 1994 - Bench disposes of this writ application without expressing any opinion on the merits of this case by relegating the writ applicant to avail the statutory remedy of appeal before the Appellate Authority: High Court [para 6, 8]
- Petition disposed of: GUJARAT HIGH COURT
2021-TIOL-38-CESTAT-AHM
Hasmukh Tobacco Products Vs CCE
CX - Assessee is engaged in manufacture of OM brand tobacco and paying Central Excise duty on 1 Pouch Packing Machine (PPM) every month, on declared Retail Sale Price (RSP) of Rs. 3/- under Compounded Levy scheme under section 3A of CEA, 1944 and in terms of Chewing Tobacco and Unmanufactured Tobacco Packing Machines Rules, 2010 - Search conducted in factory premises of assessee - SCN was issued demanding duty totally of Rs. 300.02 Lakhs with interest and penalties on assessee, its proprietor and authorized signatory for alleged manufacture and clearance of unmanufactured branded chewing tobacco without lime tube from 01.11.2013 to 30.09.2014 - There is no dispute about detection and seizure of extra PPM from factory of assessee on 03-09-2014 - Both the side have agreed to this fact - Therefore, it remains to be ascertained as to from which date it was brought in factory and installed or not installed - Statements of 03-09-2014, 21-10-2014 by Hasmukhbhai Patel and Maheshbhai Patel shows date of receipt of seized PPM as 01-08-2014 - It is not a simple bald statement in their cross examination that seized PPM was brought in factory on 01-08-2014 - From the statements recorded initially and depositions of relevant witnesses under section 9D of CEA, 1944 before Commissioner, it becomes amply clear that seized PPM was brought in the factory on 01-08-2014 - It is settled law that in cases of such clandestine manufacture and clearance, heavy burden is on Revenue to prove charges with reliable, clinching, positive evidences and independent corroborative evidences - Revenue has reiterated allegations in SCN, but not produced independent corroborative evidence to prove their case that seized PPM was an operative machine w.e.f. 01-11-2013 - Deposition of witness u/s 9D ibid, can not be brushed aside on assumptions and presumptions - When the facts are crystal clear that the seized PPM was brought in factory on 01-08-2014, what will be the duty liability of assessee from 01-08-2014 also requires to examined and considered - Since the assessee confirm the receipt of seized PPM in factory on 01-08-2014, contention of assessee that duty is not payable for August 2014 is not sustainable - Therefore, duty of Rs. 29,56,000/- for August 2014 is required to be recovered under Section 11A(10) of CEA, 1944 r/w Rule 7 of Chewing Tobacco and Unmanufactured Tobacco Packing Machines Rules, 2010 towards duty leviable on one undeclared packing machine which was found in their factory on 03.09.2014 - Duty for month of August, 2014 becomes payable by 05-09-2014 and interest liability on duty amount of Rs. 29,56,000/- may be calculated by Central Excise Officers as per proviso to Rule 9 ibid - As regards to imposition of Redemption Fine, Rule 25 of CER, 2002 is not applicable, when a specific provision has been made under Rule 18(1) of Chewing Tobacco and Unmanufactured Tobacco Packing Machines Rules, 2010 for confiscation and penalty - The Rule 18(1) ibid provides that notified goods produced or removed shall only be liable to confiscation - The seized PPM is brought in their factory and it has not been manufactured by assessee or removed from factory by assessee, therefore, seized PPM is not at all liable to confiscation under Rule 18(1) ibid - The confiscation of PPM and fine of Rs. 10,000/- is set aside - As regards to imposition & quantification of penalty, assessee has submitted that mens rea is required u/s 11AC of CEA, 1944 and that they had no intention to evade duty and they had no intention to operate two PPM at a time without paying duty or following Chewing Tobacco Rules of 2010 - The seized PPM was brought in factory on 01-08-2014 for its use alternatively, in case main PPM fails working, it was not used and that PPMs were not used together - Entire duty determined and interest stand deposited - Assessee on payment of duty with interest is eligible to reduced penalty @ 10% u/s 11AC(1)(a) ibid - Assessee is eligible for closure of proceedings only on payment of duty and interest for September 2014 - For August, 2014, duty of Rs. 29,56,000/- is payable with interest and penalty @ 10 % - Since duty with interest & penalty is imposed on assessee for August 2014, separate penalty U/R 26 of CER, 2002 on Shri Hasmukhbhai Patel, who is authorized signatory of firm is not warranted and is set aside: CESTAT
- Assessee's appeals partly allowed: AHMEDABAD CESTAT
2021-TIOL-37-CESTAT-DEL
Rajesh Agarwal @ Raju Sagar Vs CC
Cus - Absolute confiscation of exotic birds and animals owned by assessee by considering the same to be 'prohibited' and 'smuggled' - The assessee is an avid pet lover, social worker and actively involved in rescue and treatment of animals - They initially started with 3-4 exotic animals and birds and with the passage of time they kept on adding exotic birds and animals and as on today the assessee has around 200 exotic pets and animals - Vide seizure memo, the officers of DRI seized 192 exotic species (birds and animals) under the reasonable belief that they had been smuggled into India in contravention of Customs Act, 1962 - Subsequently, the said exotic birds and animals were handed over to the zoo authorities under supardanama - Admittedly, assessee have purchased exotic birds/ animals in domestic area within India, which has been corroborated by two suppliers based at Indore namely Golu and Monu who are also the co-noticees - Further, there is no evidence on record that said Golu and Monu have smuggled the exotic birds/animals in India - The Revenue has failed to establish allegation of smuggling with any cogent evidence, either by assessee or the other two co-noticees - The burden of proof lies on Revenue to support its allegation of smuggling - Further, the Allahabad High Court in case of Dinesh Chandra have held that domestic trade in exotic birds/ animals is not prohibited and substantial export of exotic birds from India is seen since several years in view of large scale breeding of exotic species in India - It is further held that no documents are specified and no permission is required as per Customs Act for keeping, breeding, buying, selling and exhibiting of such exotic birds/ animals within the country - It is further held that the exotic birds/animals are not notified under Section 123 of Customs Act - Thus, there is no presumption of smuggling on person who is in possession of such exotic birds/ animals, also do not attract the provisions of Chapter IV-A of Customs Act - The assessee will be entitled to consequential benefits including return of seized exotic birds/ animals forthwith: CESTAT
- Appeal allowed: DELHI CESTAT
