By TIOL News Service

MUMBAI, JULY 31, 2013: THE appellant filed bills of entry for clearance of 2000 pcs of GSM Dual SIM 2.6” Mobile Phone Model TS-99 and 2000 pcs of additional battery bundled and classified the goods under CTH 85171290.

The Customs officers examined the consignment and found that the goods were having only one IMEI no. instead of two despite the goods being “Dual SIM Mobile Phone” with two slots for SIM.

The authorities quickly brought into picture the DGFT Notification 112(RE-2008)/2004-2009 dated 16.06.2009 wherein the import of mobile sets without IMEI/improper IMEI is prohibited.

Probably, without bothering to find out what IMEI stands and what it is meant for, the imported goods were confiscated under section 111(d) & (m) of the Customs Act, 1962, but the benevolent adjudicating authority gave an option to redeem the goods on payment of Rs.4 lakhs for re-export and also imposed a penalty of Rs.2 lakhs.

The Commissioner(A) felt he too needs to be benevolent - so he reduced the redemption fine to Rs.3 lakhs and penalty of Rs.1 lakh.

One would say that the importer should be happy - after all, the adjudicating authority had allowed redemption of the goods (for re-export) and the lower appellate authority had reduced the redemption fine and the penalty.

No, they were not, they are before the CESTAT with an appeal -

They made the following submissions -

+ It is not disputed that the mobile handset contained one IMEI and it is not all zero, therefore, they have fulfilled the condition of the notification.

+ That they have submitted opinion of the Telecom Equipment Manufacturer's Association of India which says that mobile having single CPU shall need one IMEI no. irrespective of the number of provision for SIM card one or two or more .

+ The IMEI no. is required to locate mobile handset only. No handset can function in India without IMEI number.

+ The customs authorities cannot step into the shoes of DGFT.

+ Considering the fact that Dual SIM mobile handset having one IMEI no. is not prohibited goods and not liable for confiscation their appeal should be allowed.

The Revenue representative dialed the findings of the lower authorities.

The Bench observed -

“6.2 The department has confiscated the goods i.e GSM Dual SIM mobile phones on the ground that the goods are prohibited under the DGFT Notification no. 112(RE-2008)/2004-2009 dated 16.06.2009 as amended. The aforesaid amended Notification provides as under:-

“(i) Import of ‘Mobile Handsets' (classified under ITC (HS) Code ‘8517') without International Mobile Equipment Identity (IMEI) No. or with all Zeroes IMEI is prohibited with immediate effect.

(ii) Import of ‘CDMA mobile phones' (classified under ITC (HS) Code ‘8517') without Electronic Serial Number (ESN)/Mobile Equipment Identifier (MEID) or with all Zeroes as ESN/MEID is prohibited with immediate effect.”

6.3 Undisputedly, the appellants have imported the GSM Dual SIM Mobile Phones. The lower adjudicating authority has categorically held that the handsets were having single IMEI no. This aspect has not been challenged by the department. It is not zeroes IMEI. It is also not the case of the department that the mobile phones are “CDMA mobile phones”. In these circumstances, the mobile handset cannot be held to be prohibited. Therefore confiscation of the impugned goods and imposition of penalty are not sustainable in law. Hence the impugned Order-in-Appeal is set aside and the appeal is allowed.”

In passing - Misplaced enthusiasm : It is learnt that the Chinese mobile handset makers have also launched mobiles with TRI-SIM & QUAD-SIM facility but these too have a single IMEI - now, please don't say that the order only refers to dual SIM handsets!

(See 2013-TIOL-1151-CESTAT-MUM)