AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 124
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....self-assessed the goods under Section 17(1) of the Customs Act, 1962, with the following details: * Total Assessable Value: Rs. 67,34,868/- * Total Self-Assessed Duty: Rs. 18,79,269/- (incl. BCD @ 7.5%, SWS @ 10%, IGST @ 28%) * The duty was duly paid vide Challan No. 2047494811 dated 17.01.2024 3. Based on an alert received from the Commissioner of Customs (Investigation), CBIC, New Delhi, an Alert bearing No. 02/2024 dated 17.01.2024 was issued by Deputy Commissioner of Customs, Special Investigation & Intelligence Branch (SIIB) (Port), Kolkata, mandating 100% examination of the imported goods. The goods were physically examined on 20.01.2024 and 22.01.2024 at CFS-Phonex in presence of SIIB officer, Custom Broker's representative, and an empanelled Chartered Engineer, Shri Tapan Kumar Bhakat. 4. During examination, the following discrepancies were noticed: a. One carton containing four (04) pieces of "Engine Assembly" and five (05) pieces of "Storage Battery (12V 5Ah, 6-FM-5L)" were found which were not declared in the Bill of Entry. b. Goods at Item Sl. Nos. 28, 68 & 122 were declared as "Inverter for SC 2500I-O", "Inverter f....
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....appeal before the Commissioner (Appeals), which came to be dismissed. Being aggrieved, the appellant is before the Tribunal. 8. The Ld Counsel, appearing on behalf of the appellant, makes the following submissions : 8.1 That the findings towards confiscation, fine and penalty on re-classification of Goods Sl. Nos. 1, 3, 6, 7, 13 to 52, 54 to 108, 111 to 140, 142 to 166 and 168 to 175 from CTH 85030010 to CTH 85030090 is grossly incorrect and liable to be set aside. - At the outset, it is submitted that the Appellant had in a bonafide manner, classified the imported goods being spare parts of the Gasoline Generator Set as "Parts of Generator (AC or DC)" under CTH 85030010. - Classification of the imported goods is governed by the General Rules for the Interpretation of the Import Tariff (GRI). As per Rule 1 of GRI, "The titles of Sections, Chapters and sub-- Chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to Rule 2 to Rule 6 of the GRI". - In ....
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....pecially when there is no revenue loss to the exchequer. As such, the impugned order confirming the confiscation, fine and penalty is liable to be set aside on this ground itself. - Hence, the impugned order is liable to set aside on this ground alone. 8.2 That the allegation in relation to mis-declaration of Inverters (Sl. Nos. 28, 68 & 122) is grossly untenable and liable to be set aside. - The Appellant submits that the goods at Item Sl. Nos. 28, 68 & 122 are not complete "Inverters" but "Inverter Components," as evidenced by multiple documentary and physical proofs: a. The original Chartered Engineer report dated 16.02.2024 (No. CER/AVSE-BJ/2023-24/AV-001) included photographs on Pages 5 and 6 showing PCB components with heat sinks rather than complete inverters (Coloured photographs enclosed herewith). These photographs clearly show: - A PCB board with electronic components but lacking essential parts - No enclosure or completed casing required for a functional inverter - Absence of input/output terminals required for a working inverter - Missing display panels and control interfaces b. The Chartered En....
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....verters in that they lack several essential elements stated by the Chartered Engineer. The photographs included in the Chartered Engineer's original report clearly show a PCB component with various components like battery, capacitors, and transformer visibly absent, proving these are merely components and not complete functional inverters. - Inverter components do not fall under the ambit of mandatory BIS certification as required under the Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order, 2021, which applies only to complete inverters that can perform the full function of power inversion. - Thus, the finding of confiscation of the said goods along with option for redemption fine and penalty on account of the typographical error of stating Inverters instead of Inverter Components is grossly untenable. Reliance in this regard is placed on Huber v. Sunher Electronics Pvt. Ltd. v. Commissioner 2024 (4) TMI 1101 - CESTAT NEW DELHI and the demand is liable to be set aside on this ground itself. 8.3 That the confiscation, fine and penalty imposed on Undeclared Engine Assembly and Storage Battery is also grossly untenable....
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....Guru Ispat Ltd. Vs. C.C. (Port) [2003(151) E.L.T. 384 (Tri-Kol.)] as affirmed by the Supreme Court in 2003 (157) ELT A87 (SC): When there is wrong shipment by overseas supplier, it cannot reflect any mala fide intention on the part of the importer. b. West Coast Paper Mills Vs. CC, Chennai 2001 (130) ELT 259: There must be material evidence to support mala fide intention for mis-declaration. c. H.C.L. Comnet Systems and Services Ltd Vs. CC, New Delhi [2003(158) E.L.T. 349 (Tri-Del.)]: Without material evidence of mala fide intention, penalty is not imposable. d. Commissioner v. Victory Trading Co. 2009 (248) E.L.T. 871 (Tri. - Bang.) - Thus, the demand is liable to be set aside on this ground itself. - Without prejudice, the Appellant craves to undertake the payment of the imported duty element involved on the one carton of goods, to ensure early release of the goods seized by the departmental authorities. 9. In view of the above submissions, facts and circumstances of the case, and the legal position, the Appellant humbly prays that this Hon'ble Tribunal may be pleased to: - Set aside the Order-in-Appeal No. KOL/CUS/PORT....
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.... 17.01.2024 Alert No. 02/2024 issued mandating 100% examination of goods - 17.01.2024 Duty paid on the imported goods vide Challan No. 2047494811 188 20.01.2024 & 22.01.2024 Physical examination of goods conducted at CFS- Phonex 242 06.02.2024 Appellant's authorized representative tendered voluntary statement before authorities Referred at Para 6 at Page 245 12.02.2024 Chartered Engineer submitted his inspection report 320-340 15.02.2024 Goods seized under Section 110(1) of the Customs Act, 1962 Referred at Para 2 of Page 242 15.02.2024 Clarification received from overseas supplier acknowledging one carton was erroneously loaded by mistake 343 19.07.2024 Appellant emailed Customs authorities seeking provisional release of imported goods 350 01.08.2024 Appellant filed letter before Deputy Commissioner of Customs (SIIB) relinquishing title for wrongly loaded carton and sought release of the consignments. The Appellant also sought waiver of detention and demurrage as per Regulation 10 of Sea Cargo Manifest & Transhipment Regulations, 2018. 346 02.08.2024 Overseas supplier sent letter to the Appell....
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....the time of physical inspection. Admittedly, the appellant has received the Packing List and Invoice for 1240 Cartons of materials from the overseas exporter as has been observed from the copies of these documents made available to us. On physical verification by the Customs Officials, one Carton has been found to be excess. This carton contained four pieces of "Engine Assembly" and five pieces of "Storage Battery (12V 5Ah, 6-FM-5L)" which were not declared in the Bill of Entry. On going through the Chartered Engineer's inspection report on 16.02.2024, we find that he has certified to this effect : * The goods were spare parts of Gasoline Generator Set and not a complete Generator Set. The said spare parts were also not capable of making a complete gasoline generator set as many spare parts/items were not available. * One extra carton containing 4 pieces of Engine Assembly and 5 pieces of Storage batteries was found * The goods were not e-waste or hazardous in nature * The declared value of the goods appeared to be adequate, fair, and reasonable 14. The appellants have enclosed the letter dated 15.02.2024 from the overseas supplier acknowledgi....
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.... in respect of Sl No.28, 68 & 122. We find that the Chartered Engineer in his first Report No. CER/AVSE-BJ/2023-24/AV-001 dated 12.02.2024 subscribed to the view that the goods are "Invertor". We find from the chronological Table given above that the appellant received a letter on 2.8.2024 from the overseas exporter stating that in respect of these three items, instead of giving the description as 'Invertor Components', the exporter had given the description as "Invertor". The appellant thereafter on 6.8.2024, filed their letter before Additional Commissioner of Customs (SIIB) seeking rectification of certain items mentioned in the Bill of Entry as per supplier confirmation letter dated 02.08.2024. The Chartered Engineer issued clarification certificate stating items at Sl. Nos. 28, 68 & 122 were "INVERTER COMPONENTS". The relevant documents are extracted below: 21. Vide Certificate No. CER/AVSE-BJ/2024-25/AV-002 dated 06.08.2024, the Chartered Engineer has stated: "On extensive review of the photographs of the examined goods imported under BE No. 9660495 dated 13.01.2024, the item description of goods imported under Sl. No. 28, 68 and 122 should be read as 'INVERTER COMPONE....
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....nt to adopt this CTH in order to give a closure to the present litigation. In the absence of any mis-classification on the part of the appellant, we hold that there would be no confiscation, redemption fine, nor any penalty on the appellant in respect of these goods. 25. After going through all the three issues raised by the Revenue, we hold that the confiscation of all the goods in question [except for the extra one carton goods] is legally not sustainable and the same are required to be released without any redemption fine and penalty as has been held above. In respect of the extra carton goods, we have already held that the appellant is required to pay Redemption Fine of Rs.2000, along with the requisite Customs Duty. The penalty stands waived. 26. The appellants have also made a prayer that the authorities concerned may be directed to issue detention and demurrage waiver certificate in terms of Regulation 6 of the Handling of Cargo in Customs Areas Regulations, 2009 and Regulation 10 of the Sea Cargo Manifest and Transhipment Regulations 2018. They have relied on the case law of Ridava Petrochemicals Pvt. Ltd. v. Commissioner (2024) 20 Centax 168 (Guj.). 27. As per the....
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....n the goods were not required to be detained and the same has continued till today, no demurrage or other charges would be chargeable as per regulations 6(1)(L) of the Regulations 2009. 8. In view of the above, this petition is disposed of with the following directions:- 1. The petitioner shall not be liable to pay demurrage, detention and ground rent charges to respondent No.3 from 10/2/2021/11.2.2021 till today. 2. The petitioner shall lift the goods as early as possible latest within a period of five weeks from today. 3. The petitioner shall pay the demurrage charges, detention, ground rent charges etc. to the respondent No.3 from today till the goods are lifted by the petitioner. 30. We hold that the ratio of this case law is applicable to the facts of the present case. Accordingly, we direct the concerned Customs Officials to issue the Waiver Certificate from the date of seizure till the date of communication of this Final Order, towards container detention and ground rent/storage charges, so as to enable the petitioner to lift the imported consignment. 31. To summarize : (a) In respect of the extra one carton, it is held that....
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....gulations Ve sincerely request that any financial lovien be reimbursed by us in the future consignments so purchased from us Raquest awaited For CHONGQING SENCI IMPORT & EXPORT TRADE CO., LTD. Document 2 1- 341 -1 ure-j Japan Kumar Bhakal B.M.E (Hors.) M.JE ONG) CE Chartered Engines Technical Consultant, Surveyor & Valuer REFNO-CER/AVSE- BJ/2024-25/AN-002 Pin Code 711 106 Dated:06.08.2024 TO WHOM SO EVER IT MAY CONCERN Dear Siels Ret: Repon no-CER/AVSE- BJ/2023-24 AV:001 dated 12.023:024 SUBJECT: ITEM Rectification in 3 Serials nos of Bill of Ent « No. 9660495 dated 13.01.2024. This is to inform that with reference to the consignment shipped under Bill of Lading No ONCM-CHOICCU/010077 Dated: 30° Noven 30" November, 2023 (2 X40 Container nos (NEU4065654 & NYKU4173180| comprising of 1240 eatons vide Invoice No SCSKAD23- AVS04 DATED-13/11/2023 1 ssto be noted that three items mentioning should be read as below pt as Mentioned As per BE Stundld Be Read As Below Per HE INVERTER FOR SC 250010 |INVERTER COMPONENTS FOR SC25001-0 INVERTER FOR SC 40001-0|INVERTER COMPONENTS FOR SC40001-O ONENTS INVERTER FOR SC 20001-1. INVERTER COMPONENTS FOR ....
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....luer Hen bis Higs Coolt, Kolkata 11-0543770 1-344 -] CHONGQING SENCEIMPORT & EXPORT TRADE CO. LTD. NO.200,TONGXING BEI ROAD,TONGHAXE TOWN,BEERE DISTRICT,CHONGQING, CHINA Dated: 02.08.2024 To M/s AVS ENTERPRISE Anandpuri Chowk Opposite Rajasthan Marble. Harmiu Branchi Jharkhand, India Dear Sir/'s Attention: rectification in 3 senats dated 13% November: 2023 This is With reference to our consignment shipped to you under Bill of Lading No ONCM/CHQ/CCU/010077 Dated: 30!) November, 2023 (2 X40 Containers nos ONEUS065654 & NVKU4 173180) comprising of 1240 cartons DATED-13/11/2023 It is to be noted that three items mentioning should be read as below SI SI No In Invoice as above MENTIONED AS INVOICE SHOULD BE READ AS BELOW 1 29 INVERTER FOR SC25001-0 INVERTER COMPONENTS FOR SC25001-O 2 71 INVERTER FOR SC40001-0 INVERTER COMPONENTS FOR SC40001-0 3 130 INVERTER FOR SC20001-1 INVERTER COMPONENTS FOR SC20001-L 3 The Goods are not Complete INVERTER but are Parts of Inverter also known as Populated PCB Board We regret this in mentioning Parts of Inverter In Invoice and request you to kindly rectify the same as parts of inverter The complete inver....