TaxTMI 
TaxTMI 
2026 (9) TMI 749
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....nded warehouses, there after selling it to purported/ dummy RNI-registered actual users who filed Bills of Entry claiming exemption under Notification No. 12/2012-Cus., Sl. No. 264. It was further alleged that the Managing Director procured the names and RNI registrations of such persons for monetary consideration and devised a modus operandi to clear newsprint duty-free, including in the names of reputed newspapers. The respondent allegedly recovered the import, logistics and clearance expenses from such newspapers through debit notes. A show cause notice (SCN), was issued and, after adjudication, the Ld. Adjudicating Authority seized and confiscated the newsprint reels at various premises as under: S. No. Godown premises situated at Value of newsprint reels seized Penalty imposed on Poddar under sec. 112(a) 1. 21/2, Alipur, Thekewali Gali, Near Surya Dharam Kanta, Alipur, Delhi Rs.64,57,165/- Rs.9,60,000/- 2. Assam State Warehousing Corporation Rs.52,32,698/- Rs.7,80,000/- 3. 10/4, Village Sangdewadi Khalapur Tal, Raigad Dt. Rs.79,43,172/- Rs.11,81,000/- 4. B-24 & B-29, SIPCOT Industrial Estate, Gummidipoondi, Chennai Rs.1,....
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....Notification No. 12/2012-Cus. (Sl. No. 264). E. The News Control Order, dealing with manufacture of newsprint, is distinguishable from the issue involved in the present case. The ld. A.R. stated that the impugned Order-in-Appeal is not legal and proper and prayed that the same be set aside and the appeal be allowed. Submission made by the Respondent 3.2 Shri Hari Radhakrishnan, learned Advocate, appearing for the Respondent, submitted that the Respondent imports newsprint falling under CTH 4801 0010 and warehouses the goods in its licensed private bonded warehouses. Referring to its reply to the Joint/Additional Commissioner in response to the SCN dated 18/19.01.2016, he submitted that the Respondent places orders with foreign suppliers and, pending arrival of the goods, receives orders from RNI-certificate holders for their requirements. The imported goods are initially warehoused in Customs bonded warehouses. At this stage the Appellant executes a contract with the RNI-certificate holders for sale of goods. This is then intimated by them and the RNI-certificate holders to Customs for change in the ownership of the warehoused goods and to allow the RNI certificat....
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....ods were covered by valid bills of entry and belonged to RNI-registered newspaper publishers. As the import condition was satisfied, confiscation under Sections 111(d) or 111(o) and penalty under Section 112 are unsustainable. F. The relevant period was prior to the 03.06.2016 amendment, when RNI registration was required at clearance, not import. The Newsprint Control Order, 2004 also recognises dealers in newsprint; therefore, the Respondent was authorised to facilitate imports and deliveries for registered newspapers. The ld. Counsel prayed that the Department's appeal be dismissed and the Commissioner (Appeals)' order be upheld with consequential relief. Dispute 4. We have heard the rival parties and carefully perused the appeals. We find that the dispute pertains to the alleged illegal/ improper import of Newsprint and subsequent clearance of the same to Dummy units for illicit consideration. Non-availability of Foundational Facts 5. At the outset, we note that the SCN and RUDs have not been placed on record with the Appeal Memorandum as being relied upon. An omission which appears quite frequently in Revenue appeals and constitutes a serious deficiency....
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....t an import licence, whereas a person who did not satisfy the Actual User condition could not clear newsprint under OGL and was required to obtain the requisite import licence. The Respondent has drawn our attention to DGFT Notification No 09/20152020, dated: 03.06.2016, wherein the existing Import Policy Condition 2 of Chapter 48 of ITC(HS), 2012, Schedule -I, was amended and the wording "at the time of clearance" in the Condition, was changed to "at the time of import of goods". The said amending Notification is reproduced below: "Subject: Amendment in import policy condition No.2 under Exim Code 4801 of Chapter 48 of ITC (HS), 2012, Schedule - I (Import Policy). S.O. (E): In exercise of powers conferred by Section 3 of FT (D&R) Act, 1992, read with paragraph 1.02 and 2.01 of the Foreign Trade Policy, 2015-2020, as amended from time to time, the Central Government hereby amends the import policy condition No.2 under Exim Code 4801 of Chapter 48 of ITC (HS), 2012, Schedule - I (Import Policy) as under: 2. Existing Policy Condition No.2 of Chapter 48 of ITC (HS), 2012, Schedule - I (Import Policy): Item cover under Exim Code heading 4801 shall however be ....
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....2/2012-Cus., Sl. No. 264, (cited in the Appeal), newsprint falling under Chapter Heading 48 was exempted from BCD and additional duty. Importantly, Sl. No. 264 itself did not prescribe an RNI/Actual User condition. Relevant portion of the table to the notification is extracted below. Table S. No. Chapter or Heading or sub- heading or tariff item Description of goods Standard rate Additional duty rate Condition No. 264. 48 Newsprint - (i) in strips or rolls of a width not less than 34.92 cm; or (ii) in rectangular (including square) sheets with one side not less than 34.92 cm and the other side exceeding 15 cm in the unfolded state Nil Nil - The very basis of the appeal that RNI registration was required for treating the importer as an actual user for availing the benefit of Notification No. 12/2012-Cus. (Sl. No. 264), hence falls. Once the foundational premise is found to be untenable, the entire edifice resting upon it must necessarily fall. Order of the Commissioner (Appeals) 8. At this stage it would be apposite to examine the impugned order [Order-in-Appeal Sea C. Cus. II No. 430 & 431/....
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....d goods submitted original copy of the Bill of Entry, Bill of Lading, detailed packing list, purchase invoice, transport documents and payment documents coupled with CA certificate then it will be presumptuous to hold goods are unlawfully imported. 11. Also the Department prepared comparison sheets and indicated the reel numbers which were found tallying and those which did not tally. For all the newsprint reels which were held not tallied, the first appellant gave enough details that they were licitly imported by way of furnishing in bond bill of entry, ex bond bill of entry, container number, invoice supplier's invoice and bill of lading. Also every reel of newsprint found in the warehouse was identified in the in-bond bill of entry. All the facts are further certified by CA certificate. The original authority however erred and found to be in haste in concluding that the first appellant could not satisfactorily account for the seized goods by giving the bill of entry number without any rebuttal or admissible evidence. 12. Quite independently, I find that the newsprint is not notified either under Section 123 of the Customs Act, 1962 or Chapter IV A ibid. The....
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....018 passed by the Joint Commissioner (CAU-CH-VI) being not sustainable on merits and allow the appeal filed by M/s. Poddar Global Ltd., Regd. Office, 20 Engineers Enclave, 2nd Floor, Harsh Vihar Crossing, Pitampura, New Delhi-34 and Shri. Sunil Kumar Poddar, Director. 8.1 We find that the order is legal and proper and merits to be accepted, for reasons stated below. Analysis 9. It is settled law that the initial burden of establishing that the goods were illicitly imported lies with the Department. This reflects the onus probandi actori incumbit principle. It means that the person who wants the court to believe in a fact must prove that fact. This universal principle is also embodied in Section 101 of the Indian Evidence Act, 1872, and is now reflected in Section 104 of the Bharatiya Sakshya Adhiniyam, 2023. The Department must, therefore, first establish the foundational facts and circumstances from which it can reasonably be inferred that the goods were illicitly or improperly imported and thereafter supplied to dummy units for illicit consideration. Only upon such foundational facts being established would the evidentiary burden shift to the person in possession to sati....
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....erate in their own spheres. It has been held by the Hon'ble Supreme Court in Atul Commodities Pvt. Limited Vs CC, Cochin [2009 (235) E.L.T. 385 (S.C.)], that if any doubt or question arises in respect of interpretation of FTP, the said question or doubt shall be referred to DGFT, whose decision thereon shall be final and binding. However, no reference appears to have been made by the Customs authorities to the DGFT for determination of the disputed policy position. In the absence of such a reference, the Customs authorities could not, merely on their own interpretation of the FTP, proceed to hold that the impugned imports were in contravention of the import policy. This assumes particular significance where there is no such condition mentioned in the Customs exemption notification and the alleged contravention is sought to be founded upon an interpretation of the FTP which is itself disputed. 11. Thirdly there is not an iota of evidence, as demonstrated in the impugned order, to show that the Respondent subsequent to the import of the goods cleared the same to dummy units for illicit consideration. Recently the Hon'ble supreme court in the case of M/s Tata Steel Limited Vs Union....