TaxTMI 
TaxTMI 
2026 (4) TMI 1166
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....as allowed through State Trading Enterprises (STE). As the appellant had imported 'Technical Grade Urea', on High Sea Sales basis from MMTC, without having a valid licence issued by DGFT the goods appeared liable for confiscation under Section 111(d) of the Customs Act 1962 and therefore show cause notice was issued proposing for confiscation of 200 MT Technical Grade Urea valued at Rs.50,25,962/- and to impose penalty under Section 112(a)(i) ibid. 1.2 The show cause notice was adjudicated by learned Additional Commissioner, Customs House, Mundra, who held the goods liable for confiscation, but as the goods were not available and not cleared under bond, he had not confiscated it but imposed penalty of Rs.3,50,000/- under Section 112(a)(i) of the Customs Act 1962. 1.3 Being aggrieved from the Order-in-Original passed by the learned Additional Commissioner, the appellant filed appeal before the learned Commissioner (Appeals). The learned Commissioner rejected the appeal and upheld the Order-in-Original passed by the learned Additional Commissioner Feeling aggrieved from the impugned order passed by the learned Commissioner (Appeals) the present appeal has been filed before the ....
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.... from Director General of Foreign Trade (DGFT). It is also found that it is undisputed fact that direct import of "Technical Grade Urea" was not allowed at the relevant time and the import was allowed through STEs. In the present case, according to the appellant himself, and as evident from the documents submitted by the appellant, the goods were purchased from MMTC on High Sea Sale basis. The Bills of Entry were filed by the appellant and hence for all purposes, the appellant is considered as importer, as discussed in the impugned order. Thus the adjudicating authority has correctly held that the appellant had violated the policy provision under para 2.11 of the Foreign Trade Policy 2009-14 and the imported goods are liable for confiscation. 3.1 Learned AR also submitted that the Commissioner (Appeals) relied upon the decision in case of M/s Marico Industries Ltd vs. Commissioner of Customs (EP), Mumbai, which is similar to the present case and the decision would be applicable to it. The goods have been correctly held liable for confiscation by the lower authority. It is found that penalty under Section 112(a) is natural corollary to the confiscation of goods and hence the same....
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....No.3102 1000 of the ITC (HS) Policy 2009-2015, does not stipulate that Urea was allowed to be imported only by State Trading Enterprises; the said Heading allows import of Urea through STC, MMTC and Indian Potash Limited. Clearly, the word used in the said Heading 3102 1000 is "through" and not "by" STC, MMTC and Indian Potash. In view of above, when the import is allowed "through" STC, MMTC and Indian Potash, it means that so long as the purchase of the Urea from the foreign supplier is effected by STC, MMTC or Indian Potash and payment to foreign supplier is made by STC, MMTC or Indian Potash, who in turn sell the same to a party in India whether on High Seas or otherwise, the import is clearly through STC, MMTC or Indian Potash. 5.1 Learned Commissioner (Appeals) clearly erred in holding that under the Import Policy although the STEs who have purchased the Urea from the foreign supplier can sell the same to the Indian buyer after clearance from customs, such sale cannot be permitted on High Seas before clearance of the Urea from customs and that by virtue of purchase of the Urea on High Seas from STE and by filing the Bill of Entry, the Appellants became the importer is....
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....ellant to import the Urea through STE. If as upheld by the Commissioner (Appeals), Appellant was only permitted to purchase domestically from the STE, the letter would not have said that the Appellant is permitted to import through STE. The authorities below have mis-read the Conditions Nos. (v) and (xiv) of the Permission letter dated 15th May 2013 of the Government of India, Ministry of Chemical and Fertilizers and in inferring therefrom that High Seas purchase by Appellant from STE was not permitted as per the said conditions. The said conditions are not related to the Appellant's purchase from STE but are related to the purchases by the end users/ distributors from the Appellant. The meaning of the word "through" used in Heading No.3102 1000 of the ITC (HS) Policy, itself show that when the ITC Policy talks of import through STE, It means Import using the help of STE and not Import by STE. 5.4 Further, as per the regular practice accepted by customs for over several decades in case of imports which are canalized through STEs, the STEs place the order on the foreign supplier and thereafter effect High Seas sale of the same to the Indian Buyers. This is evident from ....