Imported Used Tyres: License Required, BIS Not Mandatory

The Tribunal upheld that used tyres are restricted items requiring a specific license for import, validating confiscation under Customs Act. It found BIS certification not mandatory for imported used tyres, setting aside penalties on that ground. Imported tyres were not deemed hazardous waste, exempting them from MOEF permission. Goods were allowed for home consumption upon payment of fines and duties, with redemption fine limited to 15% of penalty. The decision considered legal precedents and case-specific facts, providing a comprehensive resolution.

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Issues Involved:
1. Classification and importability of used tyres.
2. Requirement of BIS certification for imported tyres.
3. Applicability of Hazardous Waste (Management, Handling and Transboundary Movement) Rules, 2008.
4. Confiscation and imposition of penalty under the Customs Act, 1962.

Detailed Analysis:

1. Classification and Importability of Used Tyres:
The appellants imported used tyres classified under ITC (HS) code 4012 2090, which they argued were freely importable. The Department contended that used tyres are restricted for import under para 2.17 of the Foreign Trade Policy 2009-2014 and require a valid licence from DGFT, which was not produced by the importer. The Tribunal upheld that used tyres are restricted items and require a specific licence for import, validating the confiscation under Section 112 (d) of the Customs Act, 1962 read with Section 3 (3) of the Foreign Trade (Development and Regulation) Act, 1992.

2. Requirement of BIS Certification:
The Department argued that BIS certification was required for the imported tyres. However, the Tribunal found that the requirement of BIS certification applies only to newly manufactured tyres and not to used tyres. This was supported by the Ministry of Commerce & Industry's clarification under the RTI Act, 2005, and the Tribunal's decision in the case of Universal Trading Co. The Tribunal set aside the part of the order holding that the imported goods were liable for confiscation and penalty on the grounds of not having BIS certification.

3. Applicability of Hazardous Waste (Management, Handling and Transboundary Movement) Rules, 2008:
The Department argued that the imported tyres were hazardous waste under Entry B3140 of Schedule-3 (Part-B) of the Hazardous Waste Rules, requiring MOEF permission. However, the Tribunal noted that the imported tyres were capable of direct reuse and thus excluded from the definition of hazardous waste under Entry B3140. This was supported by the Chartered Engineer's and TNPCB's reports, and the Tribunal's decision in Jibran Overseas. The Tribunal concluded that the imported tyres did not require MOEF permission and set aside the findings of the lower authorities.

4. Confiscation and Imposition of Penalty:
The Tribunal upheld the confiscation of the goods and the imposition of a penalty under Section 112 (a) of the Customs Act, 1962, due to the import of restricted goods without a specific licence. However, since the imported goods were not considered hazardous waste, the Tribunal allowed the clearance of goods for home consumption upon payment of redemption fine, penalty, and applicable duties. The redemption fine was limited to 15% of the penalty under Section 112, and the penalty was set to 10% of the redetermined value, in line with the Tribunal's decision in Jibran Overseas.

Conclusion:
The Tribunal allowed the appeal, permitting the clearance of goods for home consumption upon payment of the specified fines and duties, and set aside the findings regarding the requirement of BIS certification and the classification of the imported tyres as hazardous waste. The detailed analysis considered the legal precedents and the specific facts of the case, ensuring a comprehensive resolution of the issues involved.

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