Commissioner of Central Excise, Delhi Versus Best Mega International>2013(03)LCX0086

2013(03)LCX0086

IN THE CESTAT, PRINCIPAL BENCH, NEW DELHI [COURT NO. I]

Ms. Archana Wadhwa, Member (J) and Shri Rakesh Kumar, Member (T)

Commissioner of Central Excise, Delhi

Versus

Best Mega International

Final Order No. 55993/2013(PB), dated 21-3-2013 in Appeal No. C/3810/2012-Cus.

Cases Quoted -

Anand Impex v. Commissioner - 2012 (281) ELT 0178 (Mad.) - Followed [Paras 4,6]

Atul Commodities Pvt. Ltd. v. Commissioner - 2009(02)LCX0009 Eq 2009 (235) ELT 0385 (S.C.) - Referred , [Para 3]

Commissioner v. Jay Dev Industries - 2012 (279) ELT 0375 (Tribunal) - Referred ....[Paras 3,4]

Sai Graphic Systems v. Commissioner - 2013 (289) ELT 0423 (Mad.) - Folloxved [Para 6]

Shivam International v. Commissioner - 2012 (286) ELT 0545 (Tribunal) - Followed [Paras 4,6]

Unitech Enterprises v. Commissioner - 2012 (279) ELT 0236 (Tribunal) - Referred [Paras 3, 4]

Advocated By -

Shri V.P. Batra, AR, for the Appellant.
Shri Priyadarshi Monish, Advocate, for the Respondent.

[Order per : Rakesh Kumar, Member (T)]. -

The facts leading to filing of this appeal are, in brief, as under :-

1.1 The respondent imported a consignment of old and used Canon Digital Multifunction Printing and Copying Machines and filed Bill of Entry No. 5503076, dated 19-12-2011 for its clearance by classifying the goods under tariff heading 8443 39 90 of the Tariff. While the respondent claims that the goods imported are different from "Photocopier Machine" and hence are freely importable without licence, the Department was of the view that the goods imported are second-hand Photocopier Machines and since at the time of import, secondhand Photocopier Machines were restricted for import and could be imported only against import licence and since no import licence has been produced, the import is in contravention of the Foreign Trade Policy 2009-14 and hence the goods are liable for confiscation under Section 111(d) of the Customs Act, 1962. According to the Department the cleared value of the second-hand machines was also on lower side and that the same is Rs. 34,92,576/- as against the declared value of Rs. 31,83,127/- and hence the goods are also liable for confiscation under Section lll(m) ibid. Accordingly after issue a Show Cause Notice, the Jurisdictional Additional Commissioner vide order-in-original dated 23-12-2011 enhanced the-OF value of the goods to Rs. 34,92,576/-, ordered confiscation of the goods under Section 111(d) and lll(m) of the Customs Act, 1962, for import without licence and misdeclaration of the value, with an option to the respondent to redeem the same on payment of redemption fine of Rs. 6,25,000/-. Besides this, he also imposed_penalty of Rs. 5,90,000/- on the respondent under Section 112(a) of the Customs Act, 1962.

1.2 On appeal being filed against the Additional Commissioner's Order, the Commissioner (Appeals) vide order-in-appeal dated 9-8-2012 set aside the Additional Commissioner's Order and allowed the appeal on the grounds that;

(a) the goods imported "second-hand Digital Multifunction printing and Copying Machines", are different from "Photocopier Machines" and, hence, were not restricted for import at the time of shipment; and

(b) there is no apparent reason for rejecting the declared CIF value of the goods.

1.3 Against this order of the Commissioner (Appeals), this appeal has
been filed by the Revenue.

2. Heard both the sides.

3. Sh. V.P. Batra, learned Departmental Representative assailed the im-pugned order by reiterating the grounds of appeal in the Revenue's appeal and pleaded that during the period when this import had been made, the import of second-hand Photocopier Machines was restricted and could be made only against the import licence, that the goods imported - old and used Digital Multifunction Printing and Copying Machines are nothing but old and used photocopier machines and hence the same were restricted items, that in this regard he relies upon the judgment of the Tribunal in the case of Commissioner of Customs, Chennai v. Jay Dev Industries reported in 2012 (279) ELT 375 and also in the case of Unitech Enterprises v. Commissioner of Customs reported in 2012 (279) ELT 236, wherein it was held that Multifunction Printing and Copying Machine is essentially a Photocopier Machine and hence the import of old and used digital Multifunction Printing and Copying Machines was restricted since 19-10-2005 in terms of para 2.17 of the Foreign Trade Policy, that Apex Court has also in the case of Atul Commodities Pvt. Ltd. reported in 2009(02)LCX0009 Eq 2009 (235) ELT 0385 (S.C.) held that the import of photocopier machines was restricted since 19-10-2005, that in view of this, the impugned order holding that the old and used Digital Multifunction Printing and Copying Machines were freely importable is not correct, that Commissioner (Appeals)'s observation with regard to valuation of the goods is also not correct, as the actual value of the goods as certified by the Chartered Engineer on the basis of the residual life of the machines is Rs. 34,92,576/- as against the declared value of Rs. 31,83,127/- and hence the assessable value has been mis-declared and that in view of the above submissions, the impugned order is not correct.

4. Sh. Priyadarshi Monish, LD. counsel for the respondent, pleaded that the goods imported are Digital Multifunction Printing and Copying Machines classifiable under sub-heading 8443 31 00 of the Tariff and the same are different from the electrostatic photocopying machines covered by sub-heading 8443 39 30, that it is the old and used electrostatic photocopying machines which were restricted for import that the import of old and used Digital Multifunction Printing and Copying Machines became restricted w.e.f. 5-6-2012 by including these machines also in para 2.17 of the Foreign Trade Policy, that from the Minutes of the Meeting of Technical Review Committee held in the Ministry of Environment and Forests on 16-11-2011, which have been obtained by the respondent under "Right to Information Act", it is clear that the Government also recognizes the fact that there are separate ITC (HS) codes for "Digital Multifunction Printing and Copying Machine" and "Photocopier Machine" and accordingly a decision was taken to include the import of second-hand Multifunction Printing and Copying Machines also in the restricted list, that since the old and used Multi-function Printing and Copying Machines were included in the restricted category by specific mention in para 2.17 w.e.f. 5-6-2012. during the period prior to 5-6-2012, the import of second-hand Digital Multifunction Machine was bit restricted, that in this regard he relies upon the judgment of Co-ordinate Bench of the Tribunal in case of Shivam International reported in 2012 (286) ELT 545 and also the judgment of Hon'ble Madras High Court in the case of Anand Impex re-ported in 2012 (281) ELT 0178 (Mad.) wherein, in respect of period prior to 5-6-2012, it has been held that there is no restriction on import of old and used Digital Multifunction Printing and Copying Machines, that the Tribunal in the case of Unitech Enterprises (supra), while taking a view different from the decision of Coordinate Bench in the case of Shivam International (supra) should have referred the matter to a Larger Bench, that in the Tribunal's Judgment in cases of Unitech Enterprises (supra) and jay Dev Industries (supra), the judgment of Hon'ble Madras High Court in the case of Anand Impex (supra) has not been discussed, that merely on the basis of Chartered Engineer's Certificate, the declared transaction value cannot be rejected when no evidence has been produced by the Department indicating that the declared transaction value is incorrect and that in view of this, there is no merit in the Revenue's appeal.

5. We have considered the submissions from both the sides and-perused the records.

6. The goods imported are old and used Digital Multifunction Printing and Copying Machines covered by sub-heading 8443 31 00. In terms of the Chartered Engineer Certificate, the remnant life of the machines is more than 5 years and the same are not e-waste fit to be discarded during the period of dispute, para 2.17 of the Foreign Trade Policy mentions the restricted category of second hand capital goods and the same mentioned only "photocopier machines" as one of the items which could not be imported in old and used condition without an import licence. The term "Digital Multifunction Printing and Copying Machines" was added in para 2.17 of the Foreign Trade Policy only w.e.f. 5-6-2012. The point of dispute is as to whether during period prior to 5-6-2012, which is the period of dispute in this case, old and used Digital Multifunction Printing and Copying Machines could be imported without licence or not.

6.1 We find that from the Minutes of the Technical Review Committee of Ministry of Environment and Forests held on 16-11-2011 which have been obtained by the respondent from the Ministry under Right to Information Act, it is clear that Government itself treated "Digital Multifunction Printing and Photocopying Machines" as different from Photocopying Machines and for this reason only, felt the need to mention the old and used Digital Multifunction Printing and Photocopying Machines in para 2.17 of the Foreign Trade Policy, as items restricted for import and accordingly w.e.f. 5-6-2012 para 2.17 of the Foreign Trade Policy was amended by adding old and used Digital Multifunction Printing and Photocopying Machines, in this para as the item restricted for import. It is, therefore, clear that during the period prior to 5-6-2012, the old and used Digital Multifunction Printing and Photocopying Machines could be imported without any licence. We find that same view has been taken by Co-ordinate Bench of the Tribunal in case of Shivam International (supra) and also by the Hon'ble Madras High Court in cases of Anand Impex (supra) and Sai Graphic System v. Com-missioner of Customs, Chennai reported in 2013 (289) ELT 0423 (Mad.). In view of this position and also keeping in view the fact that the Chartered Engineer Certificate has certified that the goods imported are not e-waste, we hold that goods, in question, were not restricted for import and as such no import licence was required for their import. Therefore there is no infirmity in the impugned order setting aside the confiscation of the goods under Section 111(d) of the Customs Act.

7. As regards the value of the goods, the declared value is Rs. 31,83,127/-, while according to the Department, the correct value of the goods based on the Chartered Engineer's Certificate would be Rs. 34,92,576/-. Difference between declared value and the value of the goods according to the Department is very small and as such no evidence has been produced by the Department that the declared transaction value is incorrect and /or that the Respondent had made additional payment to the supplier over and above declared value. In view of these circumstances we are of the view that the allegation of misdeclaration of value is also without any basis and as such there is no infirmity in the order of the Commissioner (Appeals) on this point.

8. In view of the above discussion, the order of the Commissioner (Ap-peals) is upheld. The Revenue's appeal is dismissed.

(Order dictated and pronounced in the open Court)

Equivalent 2013 (293) ELT 0243 (Tri. - Del.)

Equivalent 2013 (199) ECR 0081 (Tri.-New Delhi)