TaxTMI 
TaxTMI 
2022 (4) TMI 1370
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....e Principal Commissioner also rejected the exemption claimed by the appellant under notification dated 31.12.2009, as amended by notification dated 31.12.2016 and ordered for recovery of differential duty with interest. The Principal Commissioner also held that the goods provisionally cleared were liable to confiscation under section 111(d) of the Customs Act, 1962 [the Customs Act] but since the goods were not available and had already been cleared against Bond and Bank Guarantee, redemption fine with penalty under section 112 of the Customs Act was also imposed. 2. Customs Appeal No's. 50165 of 2021, 50166 of 2021 and 50197 of 2021 have also been filed by M/s. Roots Network LLP, M/s. Insat Export Pvt. Ltd. and M/s. Kesari Jewellers Marketing, respectively, to assail similar orders passed by the Principal Commissioner. 3. The details of the Bills of Entry and the demand made in the aforesaid four appeals are as follows: Customs Appeal No. 50192 of 2021 SN. BoE No. and Date Value (Rs.) Total Differential Duty (Rs.) Provisionally Assessed 1. 2628451 dated 28.07.2017 4,01,17,565 42,56,072 2. 2640702 dated 28.07.2017 13,89....
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....7 64,83,114 9. 2777835 dated 08.08.2017 13,55,14,910 1,43,76,777 10. 2793059 dated 09.08.2017 13,55,12,824 1,43,76,555 11. 2807575 dated 10.08.2017 12,16,11,903 1,29,01,807 6,69,01,186 Total Demand Details (A) Grand Total 116,02,49,802 12,30,90,902 (B) Redemption Fine Imposed against Provisionally Assessed BoEs [u/s. 125] 5,60,00,000 (C) Penalty Imposed [u/s. 112] 1,20,00,000 Customs Appeal No. 50197 of 2021 SN. BoE No. and Date Value (Rs.) Total Differential Duty (Rs.) Provisionally Assessed 1. 2555130 dated 22.07.2017 5,33,35,677 56,58,382 2. 2555131 dated 22.07.2017 5,34,97,543 56,75,554 3. 2596441 dated 25.07.2017 10,76,27,657 1,14,18,218 4. 2622540 dated 27.07.2017 10,82,59,025 1,14,85,200 5. 2622542 dated 27.07.2017 12,17,77,903 1,29,19,418 6. 2638220 dated 28.07.2017 12,19,49,799 1,29,37,654 7. 2652361 dated 29.07.2017 10,81,02,814 1,14,68,628 7,15,63,054 Finally Assessed 8. 2685522 dated 01.0....
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....mands were confirmed and the findings recorded in the order passed by the Principal Commissioner are as follows: "43. I find that while filing the Bills of Entry, ABANS have themselves declared the said goods as "gold coins (other than legal tenders)" and have classified the said goods under CTH 7114 19 10 whereas this heading covers 'articles of gold'. ****** 45. ****** I examine the two competing tariff entries of CTH 7114 and CTH 7118 of the First Schedule of the CTA. The relevant extract of the said two entries read as under. ****** 46. From the above, I find that heading 7118 covers coin of any metal. In the impugned case, goods are declared as coin, not being legal tender. The goods being coin are squarely covered under CTH 7118 as the terms of the CTH 7118 under the CTA is COIN while the entry in CTH 7114 is in the nature of residuary items. Hence by application of the GIR 1, impugned goods merit classification under CTH 7118, provided it is not guided otherwise by Section Note for Section XIV and Chapter Note for Chapter 71 of the CTA which are relevant in this case. I do not find anything in the said Section Notes and Chapter....
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....d coins which are no longer legal tender. The Explanatory Note has excluded coins which are collectors' pieces; medals even if "struck" in the same way as coins; coins mounted in brooches, tie-pins or other objects of personal adornment; and broken, cut or battered coins of a particular kind. It has not explicitly excluded gold coins, not being legal tender. Therefore, I find that impugned goods which are "gold coin, not being legal tender" are not explicitly excluded from heading 7418 by the Explanatory Notes since they are made in similar fashion as specified in Explanatory Notes. Therefore, impugned goods merit classification under heading 7118 of the CTA. 57. Even otherwise, it is of paramount importance to point out here that in Khandwala's case, the Hon'ble High Court of Delhi has already clarified that all gold coins are classifiable under CTH 7118 9000 and has very clearly held that there can be no question of classifying the gold coins under CTH 7114 1910. ****** Accordingly, the view of the department stands fortified from the above position of law which leaves no scope for any deliberation with regard to classification of all gold coin....
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....orn. Coin and medallions are different and distinct products. ****** 74. I find that ABANS has argued that firstly, the imported goods fall under CTH 7114 and there is no prescription of any RBI Guidelines to be followed for such goods and that in any event, even if the goods were to be classified under CTH 7118, the SCN does not specify as to which RBI Guidelines were to be followed and which have not been followed by them; that the entire allegation in this regard is based on the assumption that the RBI has issued guidelines stating that only nominated agencies can import Gold Coin, however, no such guidelines are available in the public domain. 75. I do not agree with the above contention of ABANS simply because of the fact that the goods in question are classifiable under CTH 7118 9000 and as discussed hereinabove, because DGFT'S Office Memorandum No. 01/89/180/36/AM-11/PC-II(A) dated 06.09.2017 has been upheld by Hon'ble High Court, it becomes clear that import of gold coins are subject to RBI guidelines. Here it is pertinent to mention that RBI and DGFT clearly say that apart from the authorized Banks and Nominated Agencies i.e. ....
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....accepted; (vi) As the subject goods are classifiable under CTI 7118 90 00, it is clear that the import of gold coins are subject to RBI Guidelines; (vii) As the appellant is neither an authorized bank nor a nominated agency nor a status holder, it could not import the subject goods and, therefore, the subject goods have been imported contrary to the prohibition imposed by DGFT (i.e. RBI Regulations); and (viii) The Country of Origin Certificate issued to the appellant which mentions that the goods are classifiable under CTH 7114 cannot be considered to be a valid document. 9. Shri Tarun Gulati, learned senior counsel assisted by Shri Kishore Kunal, Shri Manish Rastogi and Ms. Kanak Grover made the following submissions to assail the orders passed by the Principal Commissioner: (i) The correct classification of the imported goods is CTI 7114 19 10 and not CTI 7118 90 00 and in this connection reliance has been placed on the HSN Explanatory Notes that provide the scope and ambit of CTH 7118; (ii) CTH 7118 10 would cover coins which are not legal tender and CTH 7118 90 would cover coins whi....
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....ce the goods imported by the appellant are not a legal tender and were never a legal tender, the same cannot be classified under CTI 7118 90 00; (xiv) Even otherwise, both CTH 7118 and CTH 7114 are exempted under the exemption notification and the Agreement and thus the demand is without jurisdiction; (xv) The imported goods are not "restricted or prohibited" items irrespective of the classification under CTH 7114 or CTH 7118; (xvi) The DGFT Memorandum and the RBI letter cannot be treated as equivalent to RBI Regulations. This apart, RBI cannot regulate imports and can only issue directions to authorized person with regard to making payment relating to foreign exchange or foreign security; and (xvii) Confiscation is not sustainable nor penalty can be imposed under section 112(a) of the Customs Act. 10. Shri Rakesh Kumar and Shri Sunil Kumar, learned authorized representatives appearing for the Department, however, supported the impugned orders and made the following submissions: (i) The impugned orders are based on a correct interpretation of judgment of the Delhi High Court in Khandwala Enterprise;....
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....d below: General Exemption No. 58 Effective rate of duty for specified goods imported from Korea. - In exercise of the powers conferred by sub- section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods of the description as specified in column (3) of the Table appended hereto and falling under the Chapter, Heading, Sub- heading or tariff item of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as specified in the corresponding entry in column (2) of the said Table, when imported into India from the Republic of Korea, from so much of the duty of customs leviable thereon as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) of the aforesaid Table: Provided that the importer proves to the satisfaction of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, that the goods in respect of which the benefit of this exemption is claimed are of the origin of Republic of Korea, in accordance with the provisions of the Customs Tariff (Determination o....
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....er than gold coin), not being legal tender 7118.90 - Other This heading applies to coins of any metal (including precious metals) of officially prescribed weight and design, issued under government control for use as legal tender. Consignments of individual coins or of sets of coins which are legal tender in the country of issue are classified in this heading even if they are put up for general sale in presentation cases. The heading includes coin which is no longer legal tender but it excludes collectors pieces (see Explanatory Note to heading 97.05). Coins are made by stamping out blanks from sheet metal; these are then "struck" with the appropriate dies to produce simultaneously the designs on the two faces. The heading does not cover: (a) Medals even if "struck" in the same way as coins; these usually fall in heading 71.13, 71.14 or 71.17 or heading 83.06 (see corresponding Explanatory Notes). (b) Coins mounted in brooches, tie-pins or other objects of personal adornment (heading 71.13 or 71.17). (c) Broken, cut or battered coins of a kind usable only as scrap or waste metal. Subheading Ex....
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....ccount of tariff classification. Besides, since the tariff would be on the lines of the Harmonised System, it would bring about considerable alignment between the customs and central excise tariffs and thus facilitate charging of additional customs duty on imports equivalent to excise duty. Accordingly, it is proposed to specify the Central Excise Tariff suggested by the Study Group by a separate Tariff Act instead of the present system of the tariff being governed by the First Schedule to the Central Excises and Salt Act, 1944. 4. The main features of the Bill are as follows :- (i) The tariff included in the Schedule to the Bill has been made more detailed and comprehensive, thus obviating the need for having a residuary tariff Item. Goods of the same class have been grouped together to enable parity in treatment. * * * * * * * * 5.&....
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.... 'COIN' (71.18) is that they are: a) made by stamping out blanks from sheet metal which are then struck with appropriate dies to produce simultaneously the design on the two faces; b) of officially prescribed weight and design; c) issued under government control for use as legal tender; d) are legal tender in the country of issue; e) are no longer legal tender; f) or intended to be legal tender. 24. It is clear that sub-headings 7118.10 and 7118.90 of HSN will cover only that sub-category of 'COINS' which fulfill the aforesaid conditions and the sub-headings cannot be read in a manner so to over ride or travel beyond the Explanatory Notes provided for the main heading. Thus, coins of heading 7118 of HSN would be those made by stamping sheet and struck with appropriate dies of officially prescribed weight and design and issued under government control for use as legal tender. Sub-heading 7118.10 of HSN would cover coins which are no longer legal tender or intended to be legal tender, while sub- heading 7118.90 of HSN would cover coins which are legal tender in the country of issue. It,....
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....TI 7118 90 00 would cover coins which are legal tender in the country of issue. 28. The appellant had described the goods in the Bills of Entry as "gold coin" (round) (other than legal tender). Thus, coins imported by the appellant are not legal tender and nothing has been brought on record by the Department to substantiate that the goods imported by the appellant are legal tender. The description of the goods imported by the appellant would, therefore, not fall under CTI 7118 90 00. 29. The next issue that arises for consideration is as to whether the appellant is justified in classifying the goods under CTH 7114. CTH 7114 would cover articles of gold and the goods imported by the appellant are also articles of gold which are round in shape. Heading 71.14 of HSN provides that these goods are larger than articles of jewellery of heading 71.13 and they include articles for domestic or similar use like medals and medallions (other than those for personal adornment). 30. According to the appellant the imported articles of gold are round in shape and have images of gods, saints, temples or historical sites. These articles are struck in the form of a coin and ....
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....y of issue. It is for this reason that heading 7118, HTSUS, which provides for coins, is not being considered. See Headquarters Ruling (HQ) H074995, dated July 29, 2010 (classifying gold and silver coins by differentiating legal tender from commemorative coins), and see NY N016199, dated September 11, 2007 (classifying silver commemorative coins). ******** The Explanatory Notes to heading 71.14 clarify the tariff text "other articles for domestic or similar use" as including figures for interior decoration, mantelpiece ornaments, medals and medallions, among other listed articles. The myriad listed articles vary in size, shape, and purpose and so it could be challenging to find unifying characteristics beyond aesthetics. However, in this context, the use of the word "etc." [etcetera] indicates that this list is not exhaustive, but rather is illustrative. Medals and medallions, which are provided for in the ENs, share similar characteristics as commemorative coins insofar as they are for decorative or ornamental use, to be viewed and enjoyed by their owner or guests, or could be given as gifts to memorialize a certain event or milestone. They are unlikely to be hoa....
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....iterion 11. Number and date of invoices 7114.19 1(CT) 15.8 (KG) CTH SGE170726-2 ///////////// Gold Coin (Round) 608,008 (USD) ////////////////// 2017.07.26 50GM each, /////////////////////// /////////////////// purity 99.5% (Other than legal tender) 15,000 (GR) /////////////////////////// 12. Declaration by the exporter The undersigned hereby declares that the above details and statement are correct; that all goods were produced in THE REPUBLIC OF KOREA ........................................................................ and that they comply with the origin requirements specified for these goods in the KOREA-INDIA Comprehensive Economic Partnership Agreement for the goods exported to INDIA ........................................................................ Seoul, South Korea, 2017.07.27 ........................................................................ Place and date, ....
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.... the importation of any goods of the other Party or on the exportation of any goods destined for the territory of the other Party except in accordance with its rights and obligations under the WTO Agreement or in accordance with other provisions of this Agreement. 2. Each Party shall ensure that such measures are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to trade in goods between the Parties. Article 2.11: Tariff Classification For the purposes of this Chapter and Chapter Three (Rules of Origin), the basis for tariff classification would be the HS." 37. As noticed above, it is pursuant to the aforesaid Agreement that the Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between Governments of the Republic of India and the Republic of Korea) Rules 2009 were framed and the notification dated 31.12.2009 was issued. Infact, the notification dated 31.12.2009 specifically refers to the Agreement and the 2009 Rules. 38. At this stage, it also needs to be noticed that the Commissioner of Customs addressed a letter dated 14.09.2017 to CBEC pointing ou....
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....ticles of precious metal or of metal clad with precious metal under Exim code 7115; and coins under Exim code 7118 are Restricted." 2. The facility/protection under para 1.05 of FTP shall not be available for import of the above items from the date of restriction. 3. Effect of this Notification: Policy Condition No. 4 restricting imports of gold and silver under Exim Codes 7113, 7114, 7115 and 7118 from South Korea is inserted in Chapter 71 of ITC(HS) 2017." 40. It needs to be noted that all the Bills of Entry involved in the four appeals are prior to 25.08.2017. 41. This apart, the foreign supplier has also issued a certificate to Insat Exports Pvt. Ltd. certifying as follows: "FINE TECHNIX CO., LTD. TO WHOSOEVER IT MAY CONCERN I, Lee Jae Kyu, am the Authorized Signatory of Fine Technix Co. Ltd., ("Company") having office at Anyang-si, Gyeonggi-do, South Korea. During July & August, 2017 the Company had exported round shaped articles of gold to Insat Exports Private Limited in India which were of South Korean Origin. The details of Commercial Invoices issued are as follows:- S.NO. Inovice No. Date 1. FTX....
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....ents prior to 25.8.2017 may be considered for clearance by Customs. However, of late there has been an unprecedented surge in import of gold coins from South Korea under INDIA- Korea CEPA. Customs being the verifying agency for Rules of Origin (RoO) criteria of the imported goods, may like to examine these consignments of gold with duc diligence to ensure that such imports have complied with the RoO under the Indo-Korea CEPA. 3. To further amplify the point, since Korea is not a gold producing Country, the point to be checked is whether the exported gold articles from Korea are complying with the 'origin criteria' of Product Specific Rules of Origin under India-Korea CEPA. It may so happen that gold coins are being imported into Korea only for export purpose without any conversion facility. This is the right time for India to undertake a physical verification exercise (of manufacturing facility/premises) in coordination with our counterpart in Korea. 4. Further, as it has been observed that consignments of gold coins are being imported under HS: 7114 from South Korea, whereas the gold coins are classified under HS: 71189000 subject to RBI guidelines. T....
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....g. Kg. 10% 10% - - 2.1 Within this CTH, are included: (i) coins (other than gold coin) which are "no longer legal tender" - 7118 10 00 (ii) All remaining COINs (includes all legal tender, regardless of constituent materials, and Gold Coins) - 7118 90 00 Accordingly, the classification of GOLD COINS ought to have been under 7118 90 00. 3. Furthermore, the communication exchanged with RBI dated 13th Sept, 2017, which has been enclosed with the subject letter, states that only nominated agencies can import gold coins or gold in primary forms. They have also categorically stated that other than the notified agencies/banks/Star & Premier Trading houses, import of gold coins and medallions is not permitted. 4. In view of the above, it appears that the issue of classification and eligibility of the entities who imported "gold coins" during the period 1st July to 25th Aug 2017 under India- Korea FTA requires action in terms of Foreign Trade Policy. 5. This issues with the approval of the Board." 49. Before adverting to the decision Delhi High Court ....
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..... 12. Further, the Customs Act, 1962 does not authorise C.B.E. & C. to impose prohibitions by way of circulars, since as submitted supra, circular is not law. Therefore, the contention of the Learned Commissioner (Appeals) that the appellants are prohibited from importing gold granules, in terms of Circular No. 34/2013-Cus., dated 4-9-2013 and Circular No. 27/2016- Cus., dated 10-6-2016 is not legally sustainable. They are only clarificatory/procedural circulars, to give effect to the exemption contained in the above notifications, with special reference to disposal and monitoring of the gold imported, duty free, by the nominated agencies, in terms of the above notifications but do not impose any prohibitions/restrictions on the import of gold by others, on payment of appropriate Customs duty and the appellants have never claimed the benefit of the said exemption, as they are not nominated agency, specified in the FTP/Notification/Circular. Therefore, the Ld. Commissioner (Appeals) holding that, in terms of the said circulars, appellant was prohibited from importing gold is farfetched and without any legal basis." 51. In the decision of the Bangalore T....
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....mption, wholesale and retail sales. Further, the Master Direction issued by the RBI is also not applicable in the present case because that instruction of the RBI only applies to Nominated Banks and Nominated Agencies as notified by DGFT. Further, I also note that in the present case, the importer has not imported gold on consignment basis and therefore, the conditions laid down by the RBI is not applicable to the appellant." (emphasis supplied) 52. Thereafter, the Circular dated 31.05.2019 was issued by the Board in connection with the decision rendered by the Bangalore Tribunal in Sri Exports stating therein that the order passed by the Tribunal is not legal and proper and, therefore, the Board decided to file an appeal. It further states that similar consignment may be dealt with in terms of the Foreign Trade Policy and Boards decision. The said Circular dated 31.05.2019 is reproduced below: "Attention is invited to two CESTAT Judgments Sri Exports versus Commissioner of Customs, Hyderabad (Final Order No. A/31/194/2018, dated 22.11.2018 in Appeal No. C/30812/2018) and Sri Exports Versus C.C. Bangalore-Cus [arising out of No. 344/2018 dated 12.10.2018 passed....
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....vide Notification dated 25-8-2017 subsequently, which has been quoted supra. In other words, there was no restriction with regard to import of gold medallion on the date the same was imported by the respondent. 10. Similarly, the gold granules were imported on 21-9-2017 and thereafter DGFT issued a Notification dated 18-12-2019 by which import policy was amended and gold in any form was allowed only to be imported through nominated agencies as notified by the Reserve Bank of India in case of Banks and for other agencies by the DGFT. Thus, it is evident that on the date when the gold granules were imported i.e., on 21-9-2017, there was no restriction on its import and the restriction was imposed subsequently on 18-12-2019 by the DGFT by way of Notification. Thus, when gold medallions and gold granules were imported, they were freely importable and the same was brought under the restricted category subsequently." (emphasis supplied) 54. The Office Memorandum dated 06.09.2017, the Office Memorandum dated 16.02.2018, the Circular dated 31.05.2019 issued by the CBEC were challenged before the Delhi High Court in Khandwala. The Revenue alleged that the gold coi....
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....lar, dated 31st May, 2019, having been found by us to be in contravention of the law, the invocation of the said Circular, in para 8 of the show cause notices dated 12th July, 2019 and 28th June, 2019, too, therefore, cannot be legally sustained. Neither could any authority, adjudicating the said show cause notices, be bound by para 8 thereof." (emphasis supplied) 56. In respect of the Office Memorandum dated 06.09.2017 issued by DGFT, the Delhi High Court observed: "48. The grievance of the petitioner, needless to say, is directed against Para 4 of the aforesaid Office Memorandum dated 6th September, 2017, whereunder gold coins are held to be classifiable under sub-heading 7118 90 00, which would, per consequence, require the import thereof to be compliant with RBI guidelines. 49. Para 4 of the aforesaid Office Memorandum, dated 6th September, 2017, issued by the DGFT, merely states that gold coins are classifiable under Heading 7118 90 00 of the ITC (HS), whereas consignments of gold coins were being imported by wrongly classifying them under Heading 7114. Headings 7114 and 7118 of the ITC (HS) are completely aligned with the corresponding entr....
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.... 2019, issued to the petitioner, and 28th June, 2019/19th July, 2019, issued to Mink, would have to consider and appreciate the contention on merits, and cannot refuse to do so merely on the basis of the impugned Office Memorandum dated 6th September, 2017, issued by the DGFT, or the impugned Office Memorandum dated 16th February, 2018, issued by the C.B.E. & C. 53. In sum and substance, therefore, it is required to be clarified that the impugned Office Memorandum, dated 6th September, 2017, issued by the DGFT, and 16th February, 2018, issued by the C.B.E. & C., cannot fetter, or bind, the adjudicating authorities, adjudicating the impugned show cause notices, issued to the petitioner and to Mink, in any manner. In other words, while the position, in law, enunciated in the said Office Memoranda, is correct, the extent to which the said position in law affects the cases of the petitioner, and of Mink, would have to be assessed, on their own merits, by the competent adjudicating authorities." (emphasis supplied) 57. Regarding the Office Memorandum dated 16.02.2018, the Delhi High Court observed as follows: "55. We are unable to sustain, to any exte....
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....etitioners in these writ petitions. This is completely impermissible. Being, as it is, in the nature of executive trespass on the quasi-judicial terrain, the Office Memorandum dated 16th February, 2018, must necessarily perish. 57. We say no more." (emphasis supplied) 58. Untimely, Delhi High Court observed as follows: "59. Resultantly, these writ petitions are disposed of, in the following terms : (i) Circular No. 450/67/2019-Cus. IV, dated 31st May, 2019, stands modified by Circular No. 450/67/2019-Cus. IV, dated 9th September, 2019, issued by the Central Board of Indirect Taxes and Customs. While no orders are, therefore, required to be passed in respect of Circular dated 31st May, 2019, Circular dated 9th September, 2019, is quashed and set aside, to the extent of the directions contained therein, especially in para 4 thereof. The effect of the said Circular shall be read as limited to conveying of information, regarding the fact that Final Order No. A/31494/2018, dated 27th November, 2018, of the Hyderabad Bench of the Tribunal, in Appeal No. C/30812/2018, and the Final Order, passed by the Bangalore Bench of the Tribunal agai....
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....ons, for setting aside the show cause notices enumerated hereinabove, are rejected. This Court clarifies that, subject to the observations made hereinabove, it has expressed no opinion on the merits of the said show cause notices, or on the allegations made therein. Needless to say, however, the adjudication of the show cause notices shall abide by the findings and observations recorded herein above." (emphasis supplied) 59. The judgment of the Delhi High Court in Khandwala can be summarized as follows: (i) The Circular dated 31.05.2019 issued by CBEC directing field formations to deal with consignments pending clearance at the airports in accordance with the view of CBEC rather than the orders of the Hyderabad Bench of the Tribunal and Bangalore Bench of the Tribunal in Sri Exports has been set aside; (ii) Office Memorandum dated 06.09.2017 issued by the DGFT merely states that gold coins fall under CTI 7118 90 00 and, therefore, import would be subject to RBI Guidelines. Since it merely sets out the indisputable statutory provision, there is no reason to interfere with it. However, the manner in which an import item is described in the Bi....
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....n legal tender", the Principal Commissioner could not have concluded that the goods imported would necessarily fall under CTI 7118 90 00. 63. The Principal Commissioner has assumed that the goods were "gold coins" and, therefore, classified them under CTI 7118 90 00. The Principal Commissioner should have also examined that the appellant had also stated "other than legal tender" in the Bills of Entry. This had to be interpreted in the light of HSN Explanatory Notes to heading 71.18 of HSN and the two sub-headings. 64. The orders passed by the Principal Commissioner are based on an incorrect application of the GRI provisions and wrongly classify the imported goods under CTH 7118 on this basis. Even on application of GRI, the imported goods will not be classifiable under CTH 7118 90 00 in view of Explanatory Notes to HSN for heading 71.18. Rule 1 of the GRI states that classification has to be ascertained on the basis of Section and Chapter Notes. In terms of the Chapter and Section Notes read with the HSN Explanatory Notes, coins would be classifiable under CTH 7114 and CTH 7118 cannot be assumed to be the only entry with respect to classification of 'all coins'. T....
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....s such Regulations to be issued only by way of a notification with the previous sanction of the Central Government. Section 48 of FEMA requires Regulations issued under section 47 FEMA to be presented before the parliament Such Regulations have not been placed by the Department and only a reference has been made to a letter issued by the RBI dated 13.09.2017 or the DGFT Memorandum. These cannot be termed as Regulations issued by RBI or under FEMA. 69. This position has also clearly been explained by the Bangalore and Hyderabad Benches of the Tribunal in Sri Exports and by the Karnataka High Court in the matter arising out the appeal filed by the Department against the decision of the Bangalore Tribunal. The Karnataka High Court clearly held that in the absence of a specific notification issued by DGFT, there is no restriction which existed in the import of gold medallion and such restriction cannot be imposed by way of communications. 70. The power of RBI to issue directions under section 11 of FEMA extends only to authorized person with regards to making payment for foreign exchange or foreign security and RBI cannot regulate imports which are in the exclusive do....