1990 (4) TMI 167 - AT - Central Excise

Tribunal Decision: Misdeclaration Upheld, Exemption Denied, Confiscation Maintained, Personal Penalty Reduced

The Tribunal upheld findings of misdeclaration and unauthorized import, denied exemption eligibility, maintained confiscation and fine, and reduced ... Appellate Tribunal Issues Involved:1. Misdeclaration of goods.2. Eligibility for exemption under specific notifications.3. Legality of import under OGL (Open General License).4. Validity of additional import licenses.5. Jurisdiction of the Tribunal to re-examine issues already decided.6. Quantum of penalty and fine.7. Impleadment of interveners.Detailed Analysis:1. Misdeclaration of Goods:The Tribunal held that the goods imported by the appellants were 'jumbo rolls' and not 'cinematographic colour films.' The Tribunal found that the appellants had misdeclared the goods to avail the concessional rate of duty. The Tribunal concluded, 'After considering the evidence, there is no doubt in our mind that what the respondents imported were jumbo rolls and not cinematographic films.'2. Eligibility for Exemption under Specific Notifications:The appellants claimed exemption under Notification 52/86 and Notification 157/88. The Tribunal noted that the Collector had already found the goods ineligible for exemption under these notifications. The Tribunal observed that the appellants had not challenged this finding in their appeal, and thus, the issue was not open for determination in the current proceedings.3. Legality of Import under OGL:The Tribunal found that the appellants were not 'Actual User (Industrial)' as required under the Import Policy. The Tribunal stated, 'If and only if they obtain an industrial licence as prescribed in the IDR Act would they become actual user (industrial) for the purpose of Import Policy.' The Tribunal held that the import was unauthorized and not covered under OGL.4. Validity of Additional Import Licenses:The appellants argued that they had valid additional licenses at the time of shipment. However, the Tribunal upheld the Collector's finding that the licenses were invalid because the letter of credit was opened prior to acquiring the licenses. The Tribunal referred to Para 95(2) of the Handbook of Procedures, which requires a valid import license at the time of opening the letter of credit.5. Jurisdiction of the Tribunal to Re-examine Issues Already Decided:The Tribunal emphasized judicial discipline and the principle of res judicata, stating that a coordinate Bench cannot overturn the findings of another Bench. The Tribunal cited the Supreme Court's observation that 'a Bench of two Judges should not disregard the decision of a Bench of three Judges.' The Tribunal concluded that it could not take a different view from the earlier Bench's findings on misdeclaration and unauthorized import.6. Quantum of Penalty and Fine:The Tribunal maintained the confiscation of goods under Section 111(d) and the imposition of a fine in lieu of confiscation. The Tribunal reduced the personal penalty from Rs. 10 lakhs to Rs. 5 lakhs, considering the appellants' payment of duty without exemption. The Tribunal stated, 'The power to impose personal penalty is a discretionary one to be exercised judicially.'7. Impleadment of Interveners:The Tribunal allowed M/s. Hindustan Photo Films (HPF) to participate as interveners but rejected their request for impleadment as a party. The Tribunal noted that HPF had a commercial interest and not a legal interest in the matter. The Tribunal stated, 'In the interest of justice, we order that the request of M/s. HPF for impleadment in the appeal be rejected, while we permit them as interveners in the matter.'Conclusion:The Tribunal upheld the findings of misdeclaration and unauthorized import, denied the eligibility for exemption, and maintained the confiscation and fine, while reducing the personal penalty. The Tribunal emphasized the importance of judicial discipline and the principle of res judicata, rejecting the appellants' arguments for re-examination of issues already decided by a coordinate Bench. The Tribunal also allowed HPF to participate as interveners but not as a party.