TaxTMI 
TaxTMI 
2021 (9) TMI 770
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....020 3. C/40663/2020 C/S/40201/2020 Delhi Photocopiers C. Cus.II No.962/2020 dt. 07.10.2020 4. C/40664/2020 C/S/40202/2020 Excel Copiers C. Cus.II No.960/2020 dt. 05.10.2020 5. C/40665/2020 C/S/40203/2020 City Office Equipments C. Cus.II No.963-964/2020 dt. 07.10.2020 6. C/40666/2020 C/S/40204/2020 Atul Automation Pvt. Ltd. C. Cus.II No.965-969/2020 dt. 07.10.2020 7. C/40667/2020 C/S/40205/2020 -do- -do- 8. C/40668/2020 C/S/40206/2020 -do- -do- 9. C/40669/2020 C/S/40207/2020 -do- -do- 10. C/40670/2020 C/S/40208/2020 -do- -do- 11. C/40677/2020 C/S/40209/2020 Skylark Office Machines C.Cus.II No.959/2020 dt.05.10.2020 3. Brief facts of the case are that respondents herein filed various Bills of Entry to import used Digital Multi-Function Printers / Devices [MFDs] [MFDs] of various makes and models with standard accessories and attachments classifying them under Customs Tariff Heading 84433100. They were examined on first check appraisal in the presence of Chartered Engineer to verify (a) residual life of the goods (b) nature of the accessories (c) th....
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....) imposed redemption fine under Section 125 of the Customs Act, 1962 and permitted the importer to redeem and re-export the goods within 90 days from the date of receipt of the product failing which the imported goods were ordered to be deformed beyond use and disposed off as scrap by the importer at their own cost in terms of Rule 3 (2) of Electronics and Information Technology Goods (Requirements for Compulsory Registration) Order 2012 read with para-2 (c) of the Import Policy for Electronic Goods and Information Technology Goods as specified in Schedule-1 of Import Policy ITC (HS) 2017 and in accordance with procedures set out in Rule 15 (2) of Hazardous & Other Wastes (Management and Transboundary Movement) Rules, 2016. (iv) imposed penalties on the importers under Section 112 (a) of the Customs Act, 1962 for having rendered the goods liable for confiscation under Section 111 (d) and Section 111 (o) of the Act. (v) imposed penalty on the importer under Section 117 of the Customs Act, 1962 for non-compliance of the procedures under Section 49 of the Customs Act, 1962. 6. Aggrieved, the respondents herein appealed to the Commissioner (Appeals) who, by the imp....
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....a] and observed that order has been accepted by the department. It is the contention that the order has been accepted by the department only on monetary limits. (iv) the requirement of registration under CRO 2012 is a condition precedent for import of MFDs and the matter is under dispute before the Hon'ble Apex Court in the S.L.P filed by MeitY in RR Marketing case against the order of Hon'ble High Court of A.P & Telangana in W.P.No.2728 of 2018. (v) The Commissioner (Appeals) held that subject goods were examined by the Chartered Engineer and were found to be functional machines with residual life and they are neither sub-standard nor defective and sub-rule 3 (2) of CRO 2012 was illegally invoked in the matter. (vi) Commissioner (Appeals) has ignored the finding of the lower authority that the importer has not complied with mandatory conditions under the Hazardous Waste Rules which warrants disposal of imported goods in accordance with Rule 15 (2) i.e., they should be either re-exported or disposed by Customs as waste with permission of the Pollution Control Board. 9. Further, the following points were asserted by Revenue : (1) Imported s....
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.... (2) (3) (4) ... ... .... ... 7. Printers, Plotters IS 13252 : 2003 Information Technology Equipment - Safety - General Requirements He submits that they have neither imported 'Printers' nor 'Plotters'. What they have imported is 'Multi-Functional Devices' which are distinct products known to the market as such. These products were also brought under control through a separate gazette publication called "Electronics & Information Technology Goods (Requirement of Compulsory Registration) Order, 2021" [CRO 2021] published vide S.O.1248 (E) dt. 18.03.2021. Rule 2 of this order reads as under : "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 ....
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....ified, also require registration under the provisions of the Oder. For the notified products, the importer should get the product registered with BIS before import in India or should provide an exemption letter from MeitY. 3. The unregistered repaired/refurbished/second hand items should not be allowed to be imported without prior permission from MeitY. In such cases, the unregistered products shall be detained at customs and the matter should be brought into notice of Meity for necessary action. Yours sincerely Sd/- (Rajiv Bansal) Shri L Satya Srinivasa Joint Secretary (Customs) Central Board of Excise and Customs Department of Revenue, North Block, New Delhi 110 001." 11. Heard both sides. The issue has been considered and analysed by this Tribunal in a batch of appeals vide Final Order No.41931-41971/2021 dated 27.08.2021. The discussions and findings of the Tribunal in the above stated final order are reproduced as under : "20. The CRO order 2012 was notified vide S.O 8.(14)/2006-IPHW (Vol-III) and reads as follows : "In exercise of the powers conferred by sec....
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....e. 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 within the country and at international level; c. ..... d. ...... e. ... f. .... (fa) formulate, implement and coordinate activities relating to registration for self declaration of conformity to the relevant Indian Standard on voluntary or compulsory basis, of articles as may be considered expedient in public interest and so notified through an order by the Central Government after consulting the Bureau." A perusal of the entire BIS Rules, 1987 also shows that just like BIS Act, 1987, BIS Rules 1987 did not provide for regulating or prohibiting import of goods. Therefore, CRO 2012 has, in clause (3), gone beyond the scope of the Act and the Rules i....
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....f 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. .... .... .... ..... ..... SCHEDULE S.No. Goods or articles Indian Standard 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 This order was passed under the BIS Act, 2016 which replaced BIS Act, 1986. BIS Act, 2016 specifically provided for regulating imports Section 16 & 17 of the Act read as follows : ''16. (1) If the Central Government is of the opinion that it is necessary or expedient so to do in the public interest or for the prot....
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....acture, 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 covers imports. 24. The present case however pertains to CRO 2012 with respect to which the following can be concluded: (1) CRO 2012 was issued under the BIS Act, 1986 and BIS Rules 1987 neither of which had any provision to regulate imports. Clause (3) of CRO 2012 therefore went beyond the scope of the Act and Rules and imposed controls over imports as well. (2) CRO 2012 covers only to 'printers and plotters' and not to ''MFDs''. The circular and the letters issued by the MeitY went beyond the scope of CRO 2012 and sought to apply them to MFDs also on the ground that they are also in the form of printers. (3) Customs Act, 1962 is both a fiscal statut....
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.... 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 were examined by the Customs under first check and were verified by expert Chartered Engineer and the import duty was recalculated accordingly under CVR 2007. Neither side is disputing the valuation. Therefore, the valuation of the imported goods does not call for any interference. Consequently, the confiscation of the goods or misdeclaration under Section 111 (m) also need not be interfered with. 26. The assertion of the Revenue is that Ld. Commissioner (Appeals) allowed redemption of the goods under Section 125 for home consumption and that the goods should have been ordered to be either re-exported, or destroyed as being sub-standard and defective goods under CRO clause (3) (2). It is also the assertion of the Reve....
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....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 that is not intended to be produced but gets produced in the production process of intended product and is used as such;'' 27. In this case, the goods in question were examined by the Chartered Engineer in the presence of the importers and the Customs officers and it was found that they have residual life and they are not waste as per Rule 3 (38) of the Hazardous Waste Rules because the goods in question have further use. It is true that as per Rule 2 (23) of these Rules means "wastes specified in Part B and Part D of Schedule III for import or export‛. Schedule III, Part 'D' does include at entry B1110 "Used multifunction print and copying machines (MFDs)***. The footnote "***‛ states "Import permitted in the country only to the actua....
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....hese 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 goods in question are "other waste‛ and hence covered by the mischief of this Rule. While used MFDs are listed in the Schedule as "Other Waste'' and hence covered by the mischief of these Rules for them to be classified as "other waste'', they must be "waste'' in the first place. Goods with further use are not "waste'' as per the Rules. 29. Analogy can be drawn from the Central Excise Act which levies duty on "excisable goods'' which are manufactured or produced in India. "Excisable goods'' are defined as those listed in the Central Excise Tariff''. Through a series of judicial pronouncements, it is well settled that it is not sufficient for something to be listed in the Tariff to be excisable goods but they should be "goods'' in the first place, i.e.....
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....s 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 observing as follows : "As regards the applicability of the Electronics and IT Goods (Requirement for Compulsory Registration) Order (CRO) 2012, the communication dated 06.12.2016 makes it clear that only repaired/refurbished/second hand items, if notified, would require registration. The learned Assistant Solicitor General could not produce before us any notification issued thereunder relating to the MFD (Multi Function Devices) printers and photocopiers, whereby such registration would be a condition precedent prior to their import. In the absence of such a notification, it is not open to the Customs Authorities to blindly apply the directive of the Department of Electronics and Information Technology, Ministry of Communications and Information Techno....
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....ed 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 IX is in Section 61. Sub-section (2) of Section 61 states that if the goods remain warehoused beyond the period of 90 days from the date of which the proper officer has made an order interest shall be payable. Section 71 prohibits anybody from taking out warehoused goods except on clearance for home consumption or export or for removal to another warehouse or as otherwise provided under the Act. Provisions have been made for dealing with cases where goods have been improperly removed from the warehouse under Section 72. None of these provisions apply to goods deposited in a warehouse under Section 49 in view of the first proviso to Section 49 which says that the provisions of Chapter IX do not apply to goods deposited under Section 49. Therefore, there is neither any obligati....