2011 (6) TMI 508 - AT - Customs

Tribunal overturns decision on electric bicycles import, orders compliance with Customs Act.

The Tribunal set aside the Commissioner's decision to confiscate and impose penalties on 345 electric bicycles imported by M/s. Hindustan Steel Industries ... Import of the electric bicycles - Penalty - alleged that as the appellants have not complied with Rule 126A of Central Motor Vehicle Rules, 1989, which is a pre-condition for import of the electric bicycles as per the import licensing note to Chapter 87 of ITC (HS). The said rule required the importer to produce a valid certificate from ARAI, Pune – Held that:- technical objection of the Revenue can be overcome by transferring the goods to the specified port and filing a fresh bill of entry for clearance of the same from the specified port. It is made clear that such transfer would be at the expense of the appellant and after complying with procedural formalities for transshipment of imported goods from one port to another, orders are set aside and the matter remanded to the original adjudicating authority Issues:Confiscation of electric bicycles, imposition of penalties under Customs Act, non-compliance with import regulations, denial of benefit under Notification No. 21/2002-Cus., import at non-notified port, compliance with Rule 126A of Central Motor Vehicle Rules, 1989.Confiscation and Penalties:The Commissioner confiscated 345 electric bicycles imported by M/s. Hindustan Steel Industries and imposed penalties under Sections 112(a), 112(b), and 114AA of the Customs Act, 1962. The goods were found to be partially assembled, leading to the denial of benefits under Notification No. 21/2002-Cus. The penalties were imposed based on non-compliance with import regulations and import of goods not in fully CKD condition.Import Regulations and Compliance:The import of electric bicycles was challenged on the grounds of not being made at a specified port and non-compliance with Rule 126A of Central Motor Vehicle Rules, 1989. The appellants failed to produce a valid certificate from ARAI, Pune, as required by the import licensing note to Chapter 87 of ITC (HS). The appellants were given the opportunity to obtain the necessary compliance certificate by providing a sample set of complete parts of one electric bicycle.Judgment and Remand:The Tribunal set aside the impugned orders and remanded the matter to the original adjudicating authority for a fresh decision. The appellants were directed to transfer the goods to a specified port at their expense and obtain the compliance certificate from the proper authorities. The Tribunal clarified that it was not expressing any opinion on the eligibility for exemption under Notification No. 21/2002-Cus. The appeals were disposed of accordingly, providing the appellants with an opportunity to rectify the non-compliance issues identified.