TaxTMI 
TaxTMI 
2021 (9) TMI 183
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.... Impugned Order-in- Appeal No.& date 1. C/40098/2021 C/S/40077/2021 SP Associates C. Cus.II No.1071-74/2020 dt. 30.12.2020 2. C/40099/2021 C/S/40078/2021 -do- -do- 3. C/40100/2021 C/S/40079/2021 -do- -do- 4. C/40101/2021 C/S/40080/2021 -do- -do- 5. C/40102/2021 C/S/40081/2021 Arihant Enterprises C. Cus.II No.1075- 77/2020 dt. 30.12.2020 6. C/40103/2021 C/S/40082/2021 -do- -do- 7. C/40104/2021 C/S/40083/2021 -do- -do- 8. C/40105/2021 C/S/40084/2021 Excel Copiers C. Cus.II No.8- 12/2021 dt. 19.01.2021 9. C/40106/2021 C/S/40085/2021 -do- -do- 10. C/40107/2021 C/S/40086/2021 -do- -do- 11. C/40108/2021 C/S/40089/2021 -do- -do- 12. C/40109/2021 C/S/40090/2021 -do- -do- 13. C/40110/2021 C/S/40091/2021 City Office Equipments C.Cus. No.II 1087- 1091/2020 dt. 31.12.2020 14. C/40111/2021 C/S/40092/2021 -do- -do- 15. C/40112/2021 C/S/40093/2021 -do- -do- 16. C/40113/2021 ....
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....01.2021 2. By the impugned orders, the Ld. Commissioner of Customs (Appeals), Chennai has allowed the appeals of the respondents herein, partly modifying the orders of the adjudicating authorities by : (i) allowing redemption of the confiscated goods under Section 125 of the Customs Act, 1962 on payment of reduced amount of redemption fine (ii) reducing the penalty imposed under Section 112 (a) of Customs Act, 1962; and (iii) setting aside penalty imposed under Section 117 of the Customs Act, 1962. The orders were reviewed by the Committee of Commissioners of Customs and appeals have been filed before this Tribunal along with stay applications. 3. At the outset, Ld. Counsel for the respondents raised a preliminary objection that the stay applications filed under Rule 41 of the CESTAT (Procedure) Rules, 1982 are not maintainable and that this Tribunal does not have the power to grant stay. Rule 41 of the Customs, Central Excise & Service Tax Appellate Tribunal (Procedure) Rules, 1982 it reads as under : "The Tribunal may make such orders or give such directions as may be necessary or expedient to give effect or in relation to ....
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....wer to regulate its own procedure and the procedure of the Benches thereof in all matters arising out of the exercise of its powers or of the discharge of its functions, including the places at which the Benches shall hold their sittings. (7) The Appellate Tribunal shall, for the purposes of discharging its functions, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely :- (a) discovery and inspection; (b) enforcing the attendance of any person and examining him on oath; (c) compelling the production of books of account and other documents; and (d) issuing commissions. (8) Any proceeding before the Appellate Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purpose of section 196 of the Indian Penal Code (45 of 1860), and the Appellate Tribunal shall be deemed to be a Civil Court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974)." 5. It is his submission that Section....
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....uthority found as follows : (i) The values declared by the importers are liable to be rejected under the Customs Valuation Rules, 2007 [Valuation Rules] and goods need to be revalued as per the Chartered Engineer's Certificate. (ii) The importers failed to produce information as per Hazardous Waste Rules, 2016. (iii) The imported goods were subject to mandatory standards as per BIS for which the importer has neither submitted registration certificate from the BIS nor submitted an exemption letter from the Ministry of Electronics & Information Technology [MeitY]. (iv) The import of the goods are restricted under FTP (Para-2.31) and can be imported only against authorization from the DGFT and the importers had not produced such authorization. (v) The importers had deposited the goods in the warehouse pending clearance as per Section 49 of the Customs Act, 1962 which was allowed for a period of 30 days but importer had not applied for or obtained extension of the period to keep the goods in the warehouse. 9. Show cause notices were issued to the importers for violation of the provisions of FTP, Hazardous Waste Rules, E-Waste Rules ....
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....rtly allowed the appeals as follows : (a) reducing the redemption fine imposed under Section 125 of the Customs Act and allowing respondents to redeem the goods for home consumption. (b) reducing the penalty imposed under Section 112 (a) of the Customs Act, 1962 (c) setting aside the penalty under Section 117 of the Customs Act, 1962. 12. Revenue is aggrieved by these orders of the Commissioner (Appeals) and filed appeals on the following grounds :- (i) Commissioner (Appeals) has waived the penalty imposed under Section 117 of the Customs Act, 1962 which is not correct because it is on record that the importers had deposited the goods under Section 49 of the Customs Act, 1962 in the warehouse and had not sought permission to keep them in the warehouse beyond normal period of 30 days. (ii) The Commissioner (Appeals) has relied on the judgement of the Hon'ble Supreme Court in the case of S.L.P. No.17307/2019 in which by an order dt. 18.09.2020 it was held as follows : "Considering that the petitioners in the other special leave petitions have had their goods released pursuant to orders of this court, we allow these ap....
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....e category of printers / plotters vide DGFT notification dt. 03.10.2012 requiring registration with BIS as per CRO 2012. (3) The Directorate of Revenue Intelligence has issued an alert circular that multi-functional copiers should be in accordance with rules and provisions of CRO 2012. The substantial question of law with regard to requirements of BIS registration under CRO 2012 is pending with the Hon'ble Apex Court. The certificate of the Chartered Engineer does not alter the requirement of mandatory statutory compliance under CRO 2012. The impugned goods are being imported in large quantities since they are not manufactured in India and the intention of the Government seems to restrict in public interest import of second hand multi-functional device without a license. In view of the above, Revenue prayed that Orders-in-Appeal may be set aside by the Tribunal and the Hon'ble Tribunal may pass any order as it may be deem fit. 14. Ld. Counsel for the respondents submits that the main contention of the Revenue is that import of MFDs requires a certificate of compulsory registration by BIS as per CRO 2012. Clause (3) of this order reads as under : "....
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....Title of Indian Standard (1) (2) (3) (4) ... ... .... ... 7. Printers/ Multi- Function Devices (MFD) / Plotters IS 13252 : Part 1 : 2010 Information Technology Equipment - Safety - General Requirements The CRO 2012 specifically covers only 'printers and plotters'. The case of the Revenue rests on a circular issued by the Ministry of Information & Technology No.1/2019 dt. 02.05.2019 which reads as under : "8(29)/2019-IPHW Government of India Ministry of Electronics and Information Technology, IPHW Division. Dated, 2nd May 2019 CIRCULAR No.1 of 2019 Subject :- Clarification regarding coverage of Multi-Function Devices (MFDs) The Government of India, Ministry of Electronics and Information Technology (MeitY) has mandated Compulsory Registration for notified product categories including "Printers, Plotters" in the Electronics and IT Goods (Requirement of Compulsory Registration Order, 2012. (hereinafter called the Order) notified in the Gazette of India vide S.O.No.2357 (E) dated 03.10.2012. 2. In this regard, it is clarified that the Multi-Function Devices (MFDs), which are basically p....
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....on the ground that they do not conform to the letters/circulars issued by any officer of a Ministry. 16. He submitted that the second argument of the department is based on DGFT Notification No.5/2015-2020 dt. 07.05.2019 which reads as under : "Notification No.5/2015-2020 New Delhi Dated 7 May, 2019 Subject : Import policy for electronics and IT Goods under Schedule - I (Import Policy) of ITC (HS), 2017. S.O. (E): In exercise of powers conferred by Section 3 of FT (D&R) Act, 1992 read with paragraph 1.02 and 2.01 of the Foreign Trade Policy, 2015-2020, as amended from time to time, the Central Government hereby amends Note No.2(c) under the General Notes Regarding Import Policy and inserts Policy Condition No.2 under Chapter 84 and as Policy Condition No.5 under Chapter 85 of ITC (HS) 2017 as under : Existing General Note 2 (c) Amended General Note No.2 (c) (c) Import Policy for electronics and IT Goods : The import of Notified Goods under the "Electronics and Information Technology Goods (requirement of Compulsory Registration) Order, 2012, as amended from time to time, will be allowed subject to registration with the Bureau....
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....d as under :- S.No. Categories of Second Hand Goods Import Policy Conditions, if any Second Hand Capital Goods (a) i. Desktop Computers ii. refurbished / re-conditioned spares of re-furbished parts of Personal Computers / Laptops / Multifunctional print & copying machines iii. Air Conditioners iv. Diesel generating sets Restricted Importable against Authorization (b) All electronics and IT Goods notified under the Electronics and IT Goods (Requirement of Compulsory Registration) Order, 2012 as amended from time to time. Restricted (i) Importable against Authorization subject to conditions laid down under "Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order, 2012, as amended from time to time. (ii) Import of unregistered / non-complaint notified products as in CRO,2012, as amended from time to time is "prohibited". 3. Effect of this Notification : Import Policy and Policy condition for import of Electronics and It G....
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....ohibited during the relevant period. 17. Lastly, the learned counsel prays that a direction may be given to the Revenue to release the goods immediately since they have not been released to them despite order of Commissioner (Appeals). He also prays that an order to waive demurrages may be given to Commissioner. 18. We have gone through records of the case and considered arguments on both sides. The following questions need to be addressed : (1) Whether the multi-functional devices imported by the appellants were required to meet the standards as 'printers / plotters' as per Electronics & Information Technology Goods (Requirements of Compulsory Registration) Order 2012 ? (2) Whether the goods were covered by Hazardous & Other Wastes (Management and Transboundary Movement) Rules, 2016 ? (3) If they have to meet the standards, was the import of the goods prohibited and were they liable for confiscation under Section 111 (d) of the Customs Act, 1962 ? (4) Whether the import of goods in question was restricted under para 2.31 of FTP ? (5) Was the value declared by the respondents in their Bill of Entry incorre....
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.... 10 (1) (p) of the Bureau of Indian Standards Act, 1986 and in pursuance of clause (fa) of rule 13 of the Bureau of Indian Standards Rules, 1987. Section 10 of the Bureau of Indian Standards Act, 1986 reads as follows :- "10. Functions of the Bureau.-(1) The Bureau may exercise such powers and perform such duties as may be assigned to it by or under this Act and, in particular, such powers include the power to- (a) ....... (b) ..... ... (p) perform such other functions as may be prescribed." 21. It is pertinent to note that in the entire BIS Act, 1986, there is no provision for regulating imports at all including in Section 10 referred to above. Rule 13 of BIS Rules, 1987 deals with "other functions of the Bureau". It reads as follows : "13. Other Functions of the Bureau - The Bureau under clause (p) of sub- section (1) of section 10 may also - a. formulate, implement and coordinate activities relating to quality maintenance and improvement in products and processes; b. promote harmonious development in standardization, quality systems and certification, and matters connected therewith both....
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....overnment, after consulting the Bureau of Indian Standards, is of the opinion that it is necessary or expedient so to do in the public interest, hereby makes the following Order, namely:- 1. Short Title and commencement: - (1) This Order may be called the ―Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order, 2021". 2. Compulsory use of standard mark:- Goods or articles specified in the column (2) of the Schedule below shall conform to the corresponding Indian Standard given in the column (3) of the said Schedule and shall bear the 'Standard' Mark under a license from the Bureau of Indian Standards as per Scheme-lI of Schedule-II of Bureau of Indian Standards (Conformity Assessment) Regulations, 2018, provided that nothing in the Order shall apply in relation to goods or articles, as specified in the column (2) of the said Schedule meant for export which conform to the specification required by the foreign buyer and to goods or articles, for which the Central Government has issued specific exemption letter based on reasons to be recorded in writing. .... .... .... ..... ..... ....
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....t he has been granted a license, apply a Standard Mark, unless such goods, article, process, system or service conforms to the relevant standard or prescribed essential requirements. (2) No person shall make a public claim, through advertisements, sales promotion leaflets, price lists or the like, that his goods, article, process, system or service conforms to an Indian standard or make such a declaration on the goods or article, without having a valid certificate of conformity or licence from the Bureau or any other authority approved by the Central Government under sub-section (2) of section 16. (3) No person shall use or apply or purport to use or apply in any manner, in the manufacture, distribution, sale, hire, lease or exhibit or offer for sale of any goods, article, process, system or service, or in the title of any patent or in any trade mark or design, a Standard Mark or any colourable imitation thereof, except under a valid licence from the Bureau.'' As may be seen, the BIS Act, 2016 is an advancement of the BIS Act, 1986 and has provided for regulation of imports also. Consequently, the CRO 2021 issued under BIS Act, 2016 also cov....
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....ration made under section 77 in respect thereof, or in the case of goods under transhipment, with the declaration for transhipment referred to in the proviso to sub-section (1) of section 54. .... (o) any goods exempted, subject to any condition, from duty or any prohibition in respect of the import thereof under this Act or any other law for the time being in force, in respect of which the condition is not observed unless the non-observance of the condition was sanctioned by the proper officer;'' (4) The case of the Revenue is that the goods are liable for confiscation under Section 111 (d) of the Customs Act, 1962 because of import of the goods was prohibited under the BIS Act, 1986 read with BIS Rules 1987 read with CRO 2012 read with circular and letters issued by MeitY. In our considered view, the MFDs were clearly not covered even in the CRO 2012 whose restriction of imports itself was beyond the scope of BIS Act, 1986 and BIS Rules, 1987. Therefore, confiscation of the goods under Section 111 (d) on this ground is not sustainable and needs to be set aside which we do so. 25. It is undisputed that the goods were second hand in nature and we....
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....an the limit indicated in the said Schedule, and (iii) wastes specified in Part A or Part B of the Schedule-III in respect of import or export of such wastes in accordance with rules 12, 13 and 14 or the wastes other than those specified in Part A or Part B if they possess any of the hazardous characteristics specified in Part C of that Schedule ... ... ... (23) "other wastes" means wastes specified in Part B and Part D of Schedule III for import or export and includes all such waste generated indigenously within the country; ... ... ... (38) "waste" means materials that are not products or by-products, for which the generator has no further use for the purposes of production, transformation or consumption. Explanation.- for the purposes of this clause, (i) waste includes the materials that may be generated during, the extraction of raw materials, the processing of raw materials into intermediates and final products, the consumption of final products, and through other human activities and excludes residuals recycled or reused at the place of generation; and (ii) by-product means a material th....
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....he permission of the Pollution Control Board of the State where the Port exists. (3) In case of illegal import of hazardous or other waste, where the importer is not traceable then the waste either can be sold by the Customs authority to any user having authorisation under these rules from the concerned State Pollution Control Board or can be sent to authorised treatment, storage and disposal facility." It is emphasized that as per Rule 15 (2), the impugned goods, having been imported without the requisite permissions, should be re-exported. Therefore, Commissioner (Appeals) was wrong in allowing clearance after redemption for home consumption. We find that this Rule requires the Customs officer to ensure re-export within 90 days from arrival. In these cases, even the order of the original authorities was passed well beyond the 90 days. For instance, in case of Bill of Entry No.2706447 dt. 4/4/2019, the OIO was passed only on 14/8/2020 well beyond one year. If this Rule 15(2) is applicable to this case, it is the Customs officers who are in violation of the Rule because the Rule places an obligation on the Customs and not the importer. The question is whether the ....
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....aid officer thinks fit: Provided that, without prejudice to the provisions of the proviso to sub-section (2) of section, 115, such fine shall not exceed the market price of the goods confiscated, less in the case of imported goods they duty chargeable thereon. (2) Where any fine in lieu of confiscation of goods is imposed under sub- section (1), the owner of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges payable in respect of such goods. A perusal of this section shows that the adjudicating authority may allow redemption of prohibited goods and shall allow redemption of other goods. There is no bar on allowing redemption in any case. There is no power under this Section to allow redemption imposing same conditions for redemption [Commissioner of Customs Vs HBL Power Systems Ltd. - 2019 (367) ELT 154 (A.P). 31. In view of the above, we find that the Ld. Commissioner (Appeals) is correct in allowing redemption of the goods under Section 125 for home consumption. Hon'ble High Court of Telangana & A.P. has released identical goods for home consumption in W.P. No.2728 of 2018 obs....
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....nder this section: Provided further that the Principal Commissioner of Customs or Commissioner of Customs may extend the period of storage for a further period not exceeding thirty days at a time." 33. As can be seen, Section 49 is an enabling section and is not a prohibiting section. There is nothing in the section failure of which may be construed as contravention. A contravention, by definition, implies an act or omission prohibited by law. In this section, there is nothing which requires the importer to do or not to do something. It says that Assistant or Deputy Commissioner of Customs may permit to deposit of goods in a warehouse and the proviso states that the Commissioner can extend the period of storage. The warehouses in question are the Customs bonded warehouses licensed under Chapter IX of the Customs Act. Warehouses are normally meant for people who want to defer payment of duty they can do so by filing warehouse Bill of Entry and transferring the goods to the Customs bonded warehouse. When they clear the goods, they file an ex-bond Bill of Entry and remove the goods on payment of duty. The period for which the goods may remain warehoused under Chapter....