AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (1) TMI 838
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....ook referred by Customs for determining the price of imported cars. The Addl. Commissioner arrived at above value after allowing trade discount and depreciation and adding freight and insurance. As per public Notice No. 3/2000 dated 31/3/2000 of DGFT, the importer was restrained from selling the car for a period of two years after clearance. He requested for permission for sale of car due to financial problems. In the circumstances the Additional Commissioner held the car liable to confiscation under Section 111(d) of the Customs Act, 1962 read with Public Notice of DGPT for violation of post import condition of no sale. Option was given to redeem the car on payment of redemption fine of Rs. 1.5 lacs and penalty of Rs. 50,000/- was imposed on the importer under Section 112(a). 2.1 Later. DRI conducted enquiries from the present owner of the car who is the appellant in the case before us. It transpired that the car was sold by the importer to M/s. Himachal Futuristic Communication Ltd., New Delhi(M/s. HFCL) after being registered initially in the name of the importer vide Registration Certificate No. 529811 dated 28/10/2000. Manufacturing year of the car was shown in the Registrati....
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....pon, it was impermissible to issue second show cause notice invoking the extended period under Section 28 of the Customs Act, 1962. Ld. Counsel also relied on the judgment of Hon'ble Apex Court in case of Commissioner of Customs Vs. Finacord Chemicals (P) Ltd. (2015(319) E.L.T. 616 (S.C.)] in which it was recorded that the appellant had no role and was bonafide purchaser of the goods seized from the appellant in that case. 5. Ld. A.R. appearing for the department reiterated the findings of the Commissioner, On the issue that the show cause notice invoked provisions of Section 28 whereas duty was confirmed under Section 125(2) against the owner, he placed reliance on Hon'ble Apex Court judgment in case of J.K. Steel Vs. Union of India [1978(2) ELT J355 (S.C.)] holding that mere invocation of wrong section does not vitiate the proceedings as long as exercise of power can be addressed to a legitimate source. He relied upon Hon'ble CESTAT judgment in the case of S. A. Futehally Vs. Commissioner of Customs, Mumbai [2004(178) ELT 861(Tri. Mumbai)]. He further relied on the Hon'ble Bombay High Court decision in case of Bombay Hospital Trust Versus Commissioner of Customs ....
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.... goods for home consumption. The word 'Importer' is defined under Section 2(26) to mean "in relation to any goods at any time between their importation and the time when they are cleared for horns consumption, includes any owner or any person holding himself out to be the importer". In the present case there is no doubt that importer was not the appellant and therefore duty cannot be demanded from him under Section 28. 7.2 The question arises whether after demanding duty under Section 28 in the show cause notice, can the Adjudicating Authority confirm the demand against the present owner under Section 125(2). The Commissioner has relied upon the case of J.K. Steel (supra) to invoke the theory that application of a wrong Section will not vitiate any proceedings. We have seen the judgment in case of J. K. Steel (supra). The facts in that case were different. In that case duty was demanded under Rule 9(2) of the Central Excise Rules, which was the Rule applicable for non-payment, of Central Excise Duty. But the assessee had cleared the goods on payment of duty. The issue under consideration was payment of additional duty under Rule 10. In the circumstances, Hon'ble Apex C....
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.... are an exception to this principle. These provisions have evidently been introduced in order to recovery duty on goods which have been imported in an unauthorised manner without having been declared on their arrival in the country. However, it is not permissible, where the importer is known and in fact has been issued a notice proposing recovery of duty, simultaneously to demand duty from another person who is not the importer. The provisions of Section 125(2) of the Act are not intended to be used as a substitute for the provisions of Section 28 when circumstances prevent resort to that section. The demand for duty before us is therefore without authority of law." 3. We concur with the view taken by the Tribunal and do not think that the question referred to hereinabove needs any consideration at the hands of this Court." On the other hand Revenue places reliance on the judgments of the Hon'ble Supreme Court in the case of Jagdish Cancer & Research Centre-2001(132) ELT 257(SC)] and Tribunal in the case of Bombay Hospital Trust Vs. Commissioner [2005(188) ELT 374 (Tri. L.B.)], In these cases it was held that since post-importation conditions of the Notification No. 65/88-Cu....
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....hether with the passing of first adjudication order by the Asstt. Commissioner, the principle of res-judicata will apply and prevent the second adjudication of the case. Ld. Counsel relies heavily on the Hon'ble Supreme Court judgment in case of Mohan Meakin Ltd (supra) in which it was held that: 6. In the instant case, it is an admitted fact that after issuing a notice as contemplated under Section 124 of the Act, to the importer of the goods in question and adjudication proceeding under Section 125 had been conducted and the goods in question were released on payment of redemption fine, in such an event it matters little whether the adjudication was under which sub-clause of Section 111 because whichever is the sub-clause, there was an obligation on the adjudicating authority to find out the market value of the goods so imported and to collect all duty and other charges payable on the goods in question before releasing the goods on payment of redemption fine. Having released the goods thus into the market and permitting the sale of the same, in our opinion it is not open to the Collector to initiate another proceedings under another clause of Section 111 to recover the so-c....
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....aser whose bonafides are not doubted. This action is not sustainable in law. Even if the declaration of the importer regarding year of manufacture was false, the first Adjudicating authority as a quasi-judicial authority was expected to make necessary inquiries about the year of manufacture as well as the price of the car. Having made some enquiry, he passed the Order. Therefore the case could not be re-opened on the same issue of valuation only because the department comes up with fresh evidence regarding the true year of manufacture and the price. Revenue has tried to distinguish the facts of the present case with facts in the case of Mohan Meakin Ltd(supra) by taking a stand that there was clear fraud and suppression of not declaring the correct year of manufacture. We find that the present case as well as the Mohan Meakin Ltd(supra) case dealt with the same issue of valuation of imported goods. In both cases the basic issue is that of under valuation. We also note that it was open to Revenue to verify the details of the car imported either from the market or from the Chassis/ Engine Number which normally bear the year of manufacture. Apparently no such enquiry was made and the ....