TaxTMI 
TaxTMI 
2021 (10) TMI 719
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..... Import of peas shall be subject to an annual (fiscal year) quota of 1.5 lakh MT as per procedure notified by DGFT and it will be subject to Minimum Import Price (MIP) of Rs. 200/- and above CIF per kilogram and import is allowed through Kolkata Sea Port only. This restriction shall not apply to Government's import commitments under any Bilateral or Regional Agreement or Memorandum of Understanding. 2. The appellant / importer had obtained stay order against the above Notification / Trade Notices issued by DGFT from the Hon'ble High Court of Andhra Pradesh. However, the Hon'ble Supreme Court in Transfer Petition (Civil) No. 496 to 509/2020 dated 26.8.2020 upheld the validity of Notification and the Trade Notice imposing restriction of import of peas. 3. It appeared to the department that the appellant has violated the provisions of Foreign Trade Policy 2015 - 2020 and thereby goods under import are liable for confiscation under the provisions of Customs Act, 1962. The goods lying in Visakha Container Terminal CFS and Sravan CFS, Visakhapatnam were restrained under section 110 of the Customs Act, 1962. The appellant waived issuance of Show Cause Notice. After grant....
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....accordingly." The Appellants:- 6. The learned counsel Shri Sanjay Kr. Dubey, Senior Advocate assisted by Shri Udit Malik, Advocate appeared and argued on behalf of the appellant. The learned Senior Counsel opened his arguments by adverting to the prayer in the appeal at page 19 of the appeal paper book. He asserted that the reliefs claimed in the appeal is to allow the appellant to redeem the goods only for the purpose of re-export; to grant demurrage waiver certificate; and to set aside the penalty of Rs. One crore. 7. The arguments put forward by the counsel was mainly requesting to allow the appellant to redeem the goods for the purpose of reexport. The appellant had imported the goods during the period when the Notification dated 29.3.2019 was stayed by the Hon'ble Andhra Pradesh High Court. Later, the validity of the Notification / Trade Notice was upheld by the Hon'ble Supreme Court in the case of Union of India Vs. Agricas LLP - 2020 (373) ELT 752 (SC). 8. Pursuant to this decision of the Hon'ble Supreme Court, other importers (M/s. Raj Grow Impex LLP & M/s. Harihar Collections) whose imported goods covered by these notifications were not yet released....
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....ute confiscation but, in continuity with the order dated 18.03.2021 in these appeals, it is provided that if the importer concerned opts for re-export, within another period of two weeks from today, such a prayer for re-export may be granted by the authorities after recovery of the necessary redemption fine and subject to the importer discharging other statutory obligations. If no such option is exercised within two weeks from today, the goods shall stand confiscated absolutely. 98. The matters relating to the interveners shall also be governed by the findings of this judgment and appropriate orders in their regard shall be passed by the authorities/Courts, wherever their matters relating to the subject goods are pending but, their options of further appeal, only in relation to the quantum of amount payable, including that of penalty, is left open. 99. The respondent-importers shall pay costs of this litigation to the appellants, quantified at Rs. 2,00,000/- (Rupees two lakhs) each. 100. All pending applications stand disposed of." (Emphasis supplied) On coming to know the decision passed by Hon'ble Supreme Court in the case of Raj Grow Impex LL....
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....van CFS) under 21 bills of lading and filed 9 bills of entry. (ix) The Government of India had filed Transfer Petitions (Civil) No. 496 to 509/2020, titled as 'Agricas LLP Vs. Union of India and Ors.' before the Hon'ble Supreme Court against the stay being granted to the abovementioned notification by various High Courts in India. The Hon'ble Supreme Court vide judgment dated 26.8.2020 upheld the validity of the above mentioned notifications, inter alia, stating that the imports, if any, made relying on the interim orders would be held contrary to the Notification and Trade Notices issued under FTDR Act and would be so dealt under the provisions of Customs Act, 1962. (x) The Customs Department issued notices dated 27.8.2020, 3.9.2020, 8.9.2020 and 15.9.2020 under section 110 of the Customs Act, 1962 for confiscation of the goods imported by the appellant. (xi) On 24.9.2020, Writ Petition (Civil) No. 1662/2020 filed by the appellant was disposed by the Hon'ble High Court of Andhra Pradesh consequent to the judgment of the Hon'ble Supreme Court whereby the Hon'ble High Court granted liberty to the appellant to avail appropriate remedy under law. (xii) ....
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....re-export may be granted by the authorities after the recovery of necessary redemption fine and subject to the importer discharging other statutory obligations. (xxi) On 18.6.2021, the appellant in the light of the above directions given by the Hon'ble Supreme Court in the case of Raj Grow Impex, submitted a letter to the customs authorities seeking permission to re-export the green peas imported by them. (xxii) The customs authorities at Visakhapatnam vide letter dated 25.6.2021 rejected the request of the appellant stating that the direction is applicable only to parties therein and that the goods stands absolutely confiscated vide order dated 2.3.2021. 11. It is submitted by learned counsel that the said direction, though is binding to the parties in the appeal before the Hon'ble Supreme Court, being a judgment in rem, the directions has to be applied in similar situations of import of peas. He submitted that the Hon'ble Supreme Court having granted permission to the parties in the above captioned appeal to re-export the impugned goods, the very same relief ought to be extended to the appellant also. No fruitful purpose would be served with the absolute conf....
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....er grant of stay. The genuineness on the part of appellant may be taken into consideration for levy of redemption fine. Further that original authority in his order had extended option to redeem the goods by looking into all these aspects. 13. In regard to penalty, the learned counsel requested that a lenient view may be taken as the notification itself was under litigation. Further now the appellant only intends to re-export the goods. 14. The learned counsel submitted that in similar case of import of Peas, the Commissioner (Appeals), Chennai vide Order in Appeal F. No. C3/11/172/O/2021/SEA dated 30.6.2021 allowed re-export of the goods. The Commissioner (Appeals) had referred to the direction of Hon'ble Supreme Court in para 97 (f) in the case of Raj Grow Impex LLP (supra). He argued that the department cannot discriminate the litigants by taking different views on identical set of facts, law and situation. 15. The learned Senior Counsel put forward arguments for issuance of demurrage free certificate to the appellant. He referred to subsection (2) of Section 141 r/w Section 157 of Customs Act, 1962 as well as Handling of Cargo in Customs Area (Amendment) Regulation....
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....rein the subject goods were ordered for absolute confiscation. The appellant seeks permission to redeem the goods for purpose of re-export. Appellant also request to grant demurrage waiver certificate besides prayer to set aside the penalty of Rs. One crore. 19. The appellant had imported Green Peas under Chapter 07131000 which is restricted item in terms of Notification No. 37/2015 - 2020 dated 18.12.2019 issued by DGFT. The Notification imposes the following conditions namely:- (i) Quota of 1.5 lakhs MT (ii) Minimum Import Price (MIP) of Rs. 200/- per kg (CIF) (iii) Port of import if Kolkata 20. When there are restrictions imposed, it is necessary to obtain a license / authorization from DGFT and consequently the additional condition of "actual user" is also attracted. The appellant has imported Green Peas through Visakha Container Terminal CFS and M/s. Sravan Shipping and Services CFS under 21 bills of lading and filed 9 bills of entry. They claimed to have imported the consignment pursuant to the interim stay granted by the Hon'ble High Court of Andhra Pradesh vide order dated 16.3.2020 in W.P. (C) No. 1662 of 2020. 21. Consequent to the interim stay grant....
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.... is argued by the learned AR that the discretion given to the adjudicating authority under section 125 of Customs Act, 1962 as regards the present case could only be for absolute confiscation with levy of penalty. It was observed by the Hon'ble Supreme Court that no leniency in the name of equity can be claimed by these importers. However, citing the earlier judgment dated 18.3.2021, the Hon'ble Supreme Court allowed the importers therein to exercise the option of re-export on payment of redemption fine and discharging other statutory obligations within two weeks from 17.6.2021. This option is given to the importers therein only in view of the special circumstances existing therein. This option is in personam. 24. The Hon'ble Supreme Court has categorically held in the above two judgments (18.3.2021 and 17.6.2021) that the goods imported violating the Notifications and the Trade Notices become prohibited goods and thereby liable for absolute confiscation. The order of the Hon'ble Supreme Court permitting re-export is applicable only to the litigants therein. The appellant vide letter dated 19.9.2021 sought release of the goods on payment of fine / penalty. They t....
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.... vested with the Central Government. The reexport allowed by the Hon'ble Supreme Court in Rajgrow Impex is in exercise of the powers vested under Article 142 of the Constitution of India and hence it is applicable only to the lis therein. 29. Countering the submissions of the learned counsel for appellant with regard to the order dated 30.6.2021 in Appeal F. No. C3/2/172/O/2021 passed by the Commissioner of Customs (Appeals) Chennai, wherein Commissioner (Appeals) allowed re-export of goods, it is submitted by the learned AR that the department is intending to file appeal before CESTAT, Chennai. The same cannot be treated as the stand of the department. He prayed that the appeal may be dismissed. 30. Heard both sides. 31. The main relief prayed in the appeal is a permission to re-export the subject goods. The appellant has relied upon sub clause (f) of Para 97 of the judgment of the Hon'ble Supreme Court in the case of Raj Grow Impex LLP (supra). The said para has already been noticed above. The learned AR appearing for the Department contends that though the principle laid in the judgment is applicable in rem, the said direction is in personam and therefore applic....
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....sion of learned ASG appearing for the appellants, that it was open to the private respondents to opt for re-export of perishable imported goods lying in the customs warehouse to outside India." 34. The learned AR has vehemently contended that the direction in the judgment of Hon'ble Supreme Court to seek re-export would be applicable only to the parties therein and that it is an order in personam. We have to say that the dispute that was pending before the Hon'ble Supreme Court between Government of India and the importers had no personal or individual element in it or nothing personal or peculiar to each importer. The challenge was with the validity of the Notification as well as the Trade Notices issued by DGFT which was on identical grounds common to all the importers. No doubt the judgment of Hon'ble Supreme Court upholding the validity of the notification is a judgment in rem. The learned AR has been at pains to argue that the part of judgment which pertains to upholding the validity of the Notification is a judgment in rem and the operative part of the order of the Hon'ble Supreme Court in respect of re-export is a judgment in personam only. True it may be,....
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....rter concerned opts for re-export, within another period of two weeks from today (i.e.17.06.2021) such a prayer for re-export may be granted by the authorities after recovery of necessary Redemption Fine and subject to the impoter discharging other statutory obligations. If no such option is exercised within two weeks from today, the goods shall stand confiscated absolutely. 12. The appellant vide letter dated 22.06.2021 had submitted a request to re-export the impugned goods. Being an agricultural product, the same is prone to decay due to insecticides, fungus and natural fury. I find that the impugned goods were imported during November - January 2020. Vide the impugned order of the LAA, the department had confiscated the goods, but had not allowed redemption as the LAA had held that the same is not obligatory. Considering the nature of the impugned goods which are prone to natural vagaries and shelf life restrictions, I am inclined to allow re-export in view of the present circumstances and in line with the order of the Hon'ble Supreme Court in Civil Appeal No:2217-2218 of 2021 dated 17.06.2021, under Section 125 of the Customs Act, 1962. xxxx xxxxx xxxx xxxx ....
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....the goods but however extended option to redeem the goods by payment of redemption fine of Rs. 2 crores in terms of section 125 of the Customs Act, 1962. At that time, the decision of the Hon'ble Supreme Court in the case of Raj Grow LLP (supra) was not available either to the appellant importer or the department. The said judgment came to be rendered only on 17.6.2021. The Hon'ble Supreme Court by the said decision made way for settling the dispute as to whether goods can be released for home consumption. After this judgment of the Hon'ble Supreme Court, the appellant has come up with the plea to allow them to redeem the goods for the purpose of re-export only. They were awaiting the outcome of the decision in Raj Grow Impex LLP case. 38. On 6.7.2021, they have given a further request for permission to re-export the cargo. On 25.6.2021, the department has replied to the appellant which reads as under:- "F.No.GEN/LGL/HC/PA/201/2020-Legal Date: 25/28.06.2021 To, M/s. Oscar Commodities Pvt. Ltd., H.No.64-16-3A, Balayogi Street, Pratap Nagar, Kakinada, E.G.District, Andhra Pradesh - 533 004. Sir, ....
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....e Supreme Court and the appellants were awaiting the outcome. 40. Thus, it cannot be said that the plea for re-export is a belated one. The said plea cannot be put forward by them when the issue in respect of the validity of the Notification / Trade Notice is under consideration before the Hon'ble Supreme Court. Immediately on coming to know of the judgment, they have requested for permission to re-export in accordance with the direction in 97(f) of the judgment. The various decisions relied by the department in para 24 to 26 as above are not applicable and distinguishable on facts. 41. The Hon'ble Supreme Court in the case of Raj Grow Impex LLP case, after considering all aspects has granted permission to the importer to re-export. The very same relief cannot be denied to the appellants without cogent reasons. A party who has not been able to cross the miles should not be discriminated only for the reason that they did not join in the litigation. The directions are intended to resolve the dispute for importers who are similarly placed. We therefore are of the considered opinion that the appellants have to be granted permission to re-export the goods. We hold that the....
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.... above calculation, the profit margin is Rs. 2/- per kg. The total imported quantity is 6479 MTs. At this value, the profit element is around Rs. 1.3 crores. The total value of the imported goods is approx. Rs. 20 crores. 8. I observed that the normal redemption fine which is being levied and broadly accepted by most of the Tribunals is at 10% of the value of the goods. The Hon'ble Supreme Court in i. CC Vs. Mani Impex 2011 (8) TMI 470-SC ii. Jain Exports 1993 (66) ELT 537 (SC) has categorically held that there cannot be fixed percentage for redemption fine and has to be based on specific circumstances of the case. In this case, applying 10% of the value works out to be Rs. 2 crore. This amount serves the dual purpose of negating the profit quantum of Rs. 1.3 crores as discussed supra and also acts as a deterrent to prevent such subsequent violations. Hence I find that 10% of the value of the goods is the appropriate redemption fine." 43. The appellant has not filed any appeal against such order of levy of redemption fine. This order has attained finality as against the appellant with regard to levy of redemption fine. 44. The learned c....
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....ms area without a shipping bill or a bill of export having been filed with the Deputy Commissioner or Assistant Commissioner of Customs; (h) not permit any import cargo to enter the customs area or be unloaded therein without the import report or the import manifest having been filed with the Deputy Commissioner or Assistant Commissioner of Customs; (i) be responsible for the safety and security of imported and export goods under its custody; (j) be liable to pay duty on goods pilfered after entry thereof in the customs area; (k) be responsible for the secure transit of the goods from the said customs area to any other customs area at the same or any other customs station in accordance with the permission granted by the Deputy Commissioner or Assistant Commissioner of Customs; (l) subject to any other law for the time being in force, shall not charge any rent or demurrage on the goods seized or detained or confiscated by the Superintendent of Customs or Appraiser or Inspector of Customs or Preventive officer or examining officer, as the case may be; (m) dispose off in the manner specified and within a time limit of ninety days, ....