M/S M.B. Tubes vs Commissioner Of Customs (Import), Jnch ...

IN THE CUSTOMS, EXCISE AND SERVECE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT NO. IV

APPEAL NO. C/251/11-Mum

(Arising out of Order-in-Original No. 24/2011/CC(I) JNCH dated 17.03.2011 passed by the Commissioner of Customs (I), Nhavasheva.)

For approval and signature: Honble Shri Anil Choudhary, Member (Judicial)

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1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the : Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether their Lordships wish to see the fair copy : Seen of the order?

4. Whether order is to be circulated to the Departmental : Yes authorities? =====================================================

M/s M.B. Tubes

: Appellant Versus

Commissioner of Customs (Import), JNCH Nhavasheva : Respondent

Appearance Shri N.D. George, Advocate : For Appellant Shri M.S. Ready, Dy. Commr. (A.R.) : For Respondent

CORAM: HONBLE SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL)

Date of Hearing : 19.06.2015 Date of Decision: 19.06.2015

ORDER NO.......................................................

Per: Anil Choudhary:

The appellant M/s M.B. Tubes is in appeal against Order-in-Original dated 17.03.2011 by which order of confiscation for 267.42 metric tons of goods valued at Rs. 69,53,587.4 have been confiscated under Section 111(d) of the Customs Act with further option to redeem by paying fine of Rs. 12 lakhs and further penalty was imposed under Section 112(a) at Rs. 4 lakhs under the Act.

2. The brief facts are that the appellant imported Secondary HR Coils and End Cuttings from Canada. Bill of entry was filed on 24/1/11 showing the gross weight at 267.42 MTS valued at Rs. 69,53,587.4 and duty leviable thereon was Rs. 18,66,947/-. The subject consignment was examined on first check basis as the goods were declared as Secondary HR Coils and End Cuttings. The Docks Officer examined the goods and as per the examination order and reported that 100% checked, description and quantity. Verified secondary/defective coil other than second-hand. Verified weight, verified primary test reports as per AC docks order on hard copy to check whether the import is permitted only to specified ports as per licensing note number 2, 3, 4, to chapter 72. It was further noted by the Revenue that as per the Import Licensing Note of Chapter 72, import of secondary/defective HR Coils in nature covered under CTH No. 7208 is not allowed through the JNPT, Nhavasheva port, as such there is a Port restriction for import of this item. As the importer waived the requirement of show-cause notice and requested for personal hearing and the goods was incurring heavy detention and demurrage, personal hearing was conducted on 11.02.2011 with the representatives of the appellant who appeared and were heard.

It was stated by the importer that it is their first import and they requested for leniency. The Commissioner of Customs found that the import of a checkpoints being secondary or defective covered under CTH 7208 is not allowed through the JNPT as such that is a port restriction for import. Further it was noticed that the pre-shipment certificate regarding description material quality, chemical analysis of the material, visible inspection, thickness Cenvat of the material and the ITC HS Code number from any of the inspection agency is not accompanied. Thus it was found that the import has been made in violation of the policy provisions and the importer has also not submitted the pre-shipment certificate from any recognised inspection agency. It is further found that there is no dispute regarding the valuation of the declared goods. Accordingly the goods are liable for confiscation under Section 111(d) of the Act with an option to redeem by paying redemption fine of Rs. 12,00,000/- and further penalty of Rs. 4,00,000/- was imposed on the appellant importer under Section 112(a) Smalley.

Being aggrieved the appellant preferred the present appeal.

3.1 The learned Counsel for the appellant draws my attention to public notice being DGFT public notice No. 16/200409 dated 15/10/2004, wherein para-1 (i) provides that the following items may be imported without a licence/certificate/permission being metallic waste, scrap, seconds and defectives, other than those which are of a value below the value specified for any of such items by a notification issued in this behalf, and excluding hazardous, toxic waste, radio-active contaminated waste/scrap containing radio-active material. Further Clause (a) provides import of metallic waste and scrap in shredded form shall be permitted through all ports. Further Clause (b) provides import of metallic waste and scrap in unshredded, compressed and loose form shall be permitted though specified ports which includes JNPT. As such there have been no violation of the restriction and the learned Commissioner is in error in passing the impugned order of confiscation, fine and penalty. The learned Counsel further points out that the inspection certificate was also available dated 21.12.2010 from the inspection agency wherein the description of goods are being stated as a Secondary HR Coils and End Cuttings, country of origin  Canada, further stating that 100% visual inspection during loading process, spot radioactive check by handheld equipment. In the inspection report, it is further certified and audited that the consignment does not contain any types of arms, ammunition, mines shells, cartridges, radioactive contaminated or any other explosive material in any form either used or otherwise, and the consignment was checked for radiation level and it does not have radiation levels in excess of natural background.

3.2 The learned Counsel further urges that the issue is no longer res integra as under similar facts and circumstances, this Tribunal in the case of Mohammed Khambhati & Co. Versus Commissioner of Customs (Import), Nhava Sheva - 2014 (301) ELT 261 (Tri.-Mumbai), wherein similar consignment of Secondary HR Coils and End Cuttings was imported at the JNPT and it was contention of the Revenue that there is a restriction as per Licensing Note No. 4 of Chapter 72 wherein the goods were confiscated under Section 111(d) of the Act along with redemption fine and penalty with reference to public notice No. 16/200409, it was held that importer have complied with the conditions of the public notice and there is also an inspection certificate. Further, in the case of MTC Business Private Ltd. the import of melting scrap was allowed to be imported from JNPT. Accordingly the import was found to be in order and fulfilling the requirement of the Public Notice No. 16/200409 and accordingly the order of confiscation, fine and penalty was set aside.

4. The learned A.R. reiterated the impugned order and prays for dismissal of the appeal.

5. Having considered the rival contentions, I find that the appellant have imported the consignment in question in compliance with the DGFT Public Notice No. 16/200409 dated 15.10.2004. Further the inspection certificate was also available on record which escaped the attention of the learned Commissioner leading to an erroneous conclusion. Thus, the appeal is allowed. The impugned order is set aside. The appellant is entitled to consequential relief in accordance with law. The adjudicating authority is directed to grant refund of the redemption fine and penalty deposited by the appellant as per Rules, preferably within a period of 60 days from the date of receipt of a copy of this order.

6. Thus, the appeal is allowed.

(Pronounced in open Court)

(Anil Choudhary)

Member (Judicial)

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