TaxTMI 
TaxTMI 
2024 (12) TMI 19
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....after completing her movie shoot; and/or (c) Issue of Writ/Writs in the nature of Certiorari or any other writ or direction in the nature thereof and direct the respondent no. 3 to pay a compensation of Rs. 25,00,000/- for mental agony and harassment." 2. The petitioner had travelled from Bengaluru to Dubai on 22 May 2023 for the shooting of her film. She returned on 25 May 2023 by an Indigo flight from Dubai at Delhi International Airport, Terminal-3 and opted for the green channel. She was intercepted by a Customs Officer after she had crossed the green channel. On her search, one plastic box containing 3 gold bangles, weighing 130 grams, 15 gold beads (parts of bracelets) weighing 89 grams were recovered. The recovered goods were detained vide Detention Receipt dated 25 May 2023. 3. Order-in-Original dated 21 September 2023 was passed concluding as under:- "(i) I deny the 'Free Allowance' if any admissible to the Pax Ms. Simran Saba for not declaring the detained goods to the Proper Officer at Red Channel as well to the Customs Officer at Green Channel who intercepted her and recovered the detained goods from her. (ii) I order absolute co....
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....are introduced by virtue of Rules 3 and 4 of the 2016 Rules clearly apply to articles which are sought to be imported. However, and in our considered opinion, items which are personal in nature as opposed to those having been acquired with the intent to import would not be subject to those prescriptions. 7. The respondents would bid us to interpret the 2016 Rules as being confined to personal effects exclusive of jewellery, whether it be personal or otherwise. It is their contention that the monetary limits which are prescribed in the Proviso to Rule 3 as well as Rule 4(b) thereof would govern and be determinative of the value of jewellery that may be carried by an incoming passenger and allowed duty-free. 8. However, and in order to examine the correctness of this contention, it would be fruitful to refer to the legislative history of the rules pertaining to baggage as framed in exercise of the powers conferred by Section 79 of the Act. 9. If we were to travel back in time to the Baggage Rules, 1998 [1998 Rules], it becomes apparent that those rules did not incorporate a definition of "personal effects" in explicit terms. Appendices A and B thereof, however, while declari....
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....t to give this benefit. 3. The Baggage Rules, 1998 issued vide Notn. No. 30/98-Cus (NT) dated 2/6/98 has provided for import of duty free goods by tourists in Regulation 7 as contained in Appendix 'E' of the said rules. There is no definition for personal effects in the present Baggage Rules. However, for the sake of uniformity it is considered necessary to reiterate that the personal effects would include the following goods: (i) Personal jewellery (ii) One camera with film rolls not exceeding twenty (iii) One video camera/ camcorder with accessories and with video cassettes not exceeding twelve (iv) One pair of binoculars (v) One portable colour television (not exceeding 15 cms in size) (vi) One music system including compact disc player (vii) One portable typewriter (viii) One perambulator (ix) One tent and other camping equipment (x) One computer (laptop/ note book) (xi) One electronic diary (xii) One portable wireless receiving set (transister radio) (xiii) Professional equipments, instruments and Apparatus of appliances including professional a....
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....ery, required for satisfying daily necessities of life. Articles other than those mentioned in Annex. I upto a value of Rs. 15,000 if these are carried on the person or in the accompanied baggage of the passenger. All passengers upto 10 years of age and returning after stay abroad of more than three days. Used personal effects, excluding jewellery, required for satisfying daily necessities of life. Articles other than those mentioned in Annex. I upto a value of Rs. 12,000 if these are carried on the person or in the accompanied baggage of the passenger. All passengers upto 10 years of age and returning after stay abroad three days or less. Used personal effects, excluding jewellery, required for satisfying daily necessities of life. Articles other than those mentioned in Annex. I upto a value of Rs. 3,000 if these are carried on the person or in the accompanied baggage of the passenger. Explanation. - The free allowance under this rule shall not be allowed to be pooled with the free allowance of any other passenger." APPENDIX B (See rule 4) (1) (2) Passengers of and above 10 years of age and returning after stay abroad of more than three years....
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.... while exiting the country or carried in its baggage. Thus, personal jewellery which is not found to have been acquired on an overseas trip and was always a used personal effect of the passenger would not be subject to the monetary prescriptions incorporated in Rules 3 and 4 of the 2016 Rules. 16. This clearly appeals to reason bearing in mind the understanding of the respondents themselves and which was explained and highlighted in the clarificatory Circular referred to above. That Circular had come to be issued at a time when the Appendices to the 1998 Rules had employed the phrase "used personal effects, excluding jewellery". The clarification is thus liable to be appreciated in the aforesaid light and the statutory position as enunciated by the respondents themselves requiring the customs officers to bear a distinction between "personal jewellery" and the word "jewellery" when used on its own and as it appears in the Appendices. This position, in our considered opinion, would continue to endure and remain unimpacted by the provisions contained in the 2016 Rules. 17. This Court had an occasion to consider the issue of ornaments and jewellery being carried as part of baggag....
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....revious purchases before the Respondents. 21. Some of the jewellery items purchased by the Petitioner were for her personal use and some were intended to be left with her parents in Indonesia. One of the items confiscated by the customs was a silver panther which was valued in U.K. Pound Sterling 9,460/- for which the Petitioner did not claim exemption from VAT because it was to be taken back to England by the Petitioner. To this extent, the conduct of the Petitioner appears to be consistent and bona fide. 22. The overall circumstances show that even though she brought jewellery of a huge amount into the country, the Petitioner did not seem to have the intention to smuggle the jewellery into India and to sell it off. If jewelleries were to be sold in India, its cost was only about Rs. 25 lakh. is not understood why a person should import jewellery of Rs. 1.27 crores and try to smuggle it in, only to sell it for Rs. 25 lakh. The benefit of doubt must, therefore, go to the Petitioner. 23. We also find from the record that out of the 28 packages that were brought into the country by the Petitioner, as many as 11 items were used jewellery. In fact photographs....
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.... through the green channel. Such declarations are deemed to be implicit and devised with a view to facilitate expeditious and smooth clearance of the passenger. Further, as per the International Convention on the Simplification and Harmonisation of Customs Procedures (Kyoto 18-5-1973), a passenger going through the green channel is itself a declaration that he has no dutiable or prohibited articles. Further, a harmonious reading of Rule 7 of the Baggage Rules, 1998 read with Appendix E (2) (quoted above), the respondent was not carrying any dutiable goods because the goods were the bona fide jewellery of the respondent for her personal use and was intended to be taken out of India. Also, with regard to the proximity of purchase of jewellery, all the jewellery was not purchased a few days before the departure of the respondent from UK, a large number of items had been in use for a long period. It did not make any difference whether the jewellery is new or used. There is also no relevance of the argument that since all the jewellery is to be taken out of India, it was, therefore, deliberately brought to India for taking it to Singapore. Foreign tourists are allowed to bring into Indi....
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....onesia. Some of the jewellery items purchased by the respondent were for her personal use and some were intended to be left with her parents in Indonesia. The High Court has rightly held that when she brought jewellery of a huge amount into the country, the respondent did not seem to have the intention to smuggle the jewellery into India and to sell it off. Even on the examination of the jewellery for costing purposes, it has come out to be of Rs 25 lakhs and not Rs 1.27 crores as per DRI. The High Court was right in holding that it is not the intention of the Board to verify the newness of every product which a traveller brings with him as his personal effect. It is quite reasonable that a traveller may make purchases of his personal effects before embarking on a tour to India. It could be of any personal effect including jewellery. Therefore, its newness is of no consequence. The expression "new goods" in their original packing has to be understood in a pragmatic way. 16. We are of the considered opinion that in the absence of any facts on record about the nature and mode of concealment and also any finding of the lower authority that jewellery was kept in a way to evade....
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....er who has brought the baggage. Section 81 of the Act empowers the Central Board to frame regulations regarding the declaration of the contents of any baggage, its custody, examination, assessment to duty and clearance of baggage and transit of baggage from One customs station to another or to a place outside India. Going by the stipulations in Sections 77, 80 and 81 of the Act, I am persuaded to take the view that the provisions therein can have no application to the instant case where the petitioner, a tourist coming from Sri Lanka had on his person a gold chain which he was wearing and was not kept concealed in his body. Such being the situation, clauses (1) and (m) of Section 111 of the Act can have no application. 16. That takes me to the question whether the petitioner had imported or attempted to import or brought to Indian Customs Waters for the purpose of being imported, gold ornaments, contrary to any prohibition imposed by the Act or any other law, so as to attract clause (d) of Section 111 of the Act. Necessarily therefore the question whether the Act or any other law prohibits a tourist coming to India from wearing gold ornaments arises for consideration. The ....
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....lumn (2) of Appendix E. The petitioner is a tourist of foreign origin. This fact is not in dispute. Going by entry (b) in Appendix-E, tourists of foreign origin, other than those of Pakistani origin coming from Pakistan, coming to India by air can be allowed clearance free of duty (i) his or her used personal effects and (ii) : articles other than those mentioned in Annexure-I, up to a value of Rs. 8000 for personal use of the tourist or as gifts and travel souvenirs if these are carried on the person or in the accompanied baggage of the passenger. Annexure I referred to in Appendix E is extracted below for easy reference:- 1. Firearms. 2. Cartridges of fire arms exceeding 50. 3. Cigarettes exceeding 200 or cigars exceeding 50 or tobacco exceeding 250 gms. 4. Alcoholic liquor or wines in excess of two litres. 5. Gold or silver, in any form, other than ornaments. 22. The effect of the aforesaid stipulations in Appendix-E and Annexure-I of the Baggage Rules, 1998 is that a tourist of foreign origin coming to India by air is not entitled to duty free clearance of firearms, cartridges of fire arms exceeding 50 numbers, cigarettes ex....
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....ain is prohibited. The Act and the Rules do not even remotely indicate that a foreign tourist entering India cannot wear a gold chain on his person, in other words, foreign tourists entering India are in a boundless sea of uncertainty as to whether it is prohibited or not. As the Customs Act, 1962 and the rules framed there under contemplate confiscation and levy of penalty as also prosecution, the State has a duty to specify with a degree of certainty as to what is prohibited and what is not, without leaving it to the foreign tourist to guess what is prohibited and what is not." 20. The learned Judge proceeded further to enter the following remarks with respect to a lack of clarity in the rules itself as would be manifest from a reading of Para 30 of the report: - "30. The principle laid down in the aforesaid decisions is founded on a universal sense of fairness or reasonableness. The apprehension voiced by the Apex Court in Kartar Singh v. State of Punjab [(1994) 3 SCC 569] and by the Supreme Court of United States in jay Giaccio v. State of Pennsylvania, (1966) 382 US 399; 'has proved to be true in the instant case where, without the backing of a law which expressly ....