2014 (5) TMI 206 - AT - Customs

Tribunal upholds Commissioner's decision, emphasizing accuracy in import regulations

COMMISSIONER OF CUSTOMS (ACC & IMPORT) Versus CHEMPI FINE CHEMICALS

COMMISSIONER OF CUSTOMS (ACC & IMPORT) Versus CHEMPI FINE CHEMICALS - 2014 (308) E.L.T. 157 (Tri. - Mumbai) Issues:1. Duty-free clearance under Customs Notification2. Confiscation of goods under Customs Act3. Misdeclaration of goods as chemical instead of drug4. Violation of Drugs and Cosmetics Act5. Appeal against order of Commissioner (Appeals)Issue 1: Duty-free clearance under Customs NotificationThe case involved the re-import of certain goods claimed duty-free under Customs Notification No. 94/96. The goods were initially exported and then re-imported by the respondent. The Assistant Drug Controller opined that the goods were used for therapeutic purposes and could be produced under a proper drug license. However, it was found that the manufacturer did not have the required manufacturing license, leading to confiscation of the goods under Sections 111(d) and 111(m) of the Customs Act, 1962.Issue 2: Confiscation of goods under Customs ActThe original authority confiscated the goods under Sections 111(d) and 111(m) of the Customs Act, while imposing a penalty on the importer and the director of the company. The Commissioner (Appeals) later allowed the appeal, stating that the goods were not misdeclared and could be freely imported as per the Import-Export Policy. The Revenue appealed this decision before the Tribunal.Issue 3: Misdeclaration of goods as chemical instead of drugThe Revenue argued that there was misdeclaration as the goods were declared as chemicals but were actually drugs. The Assistant Drug Controller's presumption that the goods were manufactured by the respondent was disputed, as the goods were purchased from another manufacturer. The description of the goods was considered complete, and there was no misdeclaration found in the description.Issue 4: Violation of Drugs and Cosmetics ActThe Revenue contended that the goods were prohibited for manufacture in India without a valid license, leading to a violation of the Drugs and Cosmetics Act. However, the Tribunal found that the goods were not prohibited for import as per the Import Policy, and the assumption that the goods were manufactured by the respondent was incorrect. The Tribunal concluded that there was no violation of the Drugs and Cosmetics Act or confiscation under Section 111(d) of the Customs Act.Issue 5: Appeal against order of Commissioner (Appeals)The Tribunal dismissed the appeal filed by the Revenue, stating that there was no misdeclaration in the description of the goods and no violation of the Drugs and Cosmetics Act or the Customs Act. The Tribunal upheld the decision of the Commissioner (Appeals) and ruled in favor of the respondent, concluding that the goods were not prohibited for import and there was no infirmity in the impugned order.In summary, the Tribunal dismissed the Revenue's appeal, finding no misdeclaration in the goods' description, no violation of the Drugs and Cosmetics Act, and no grounds for confiscation under the Customs Act. The decision highlighted the importance of proper documentation and compliance with import regulations.