At, Customs Excise Service Tax Appellate Tribunal West Zonal Bench At Mumbai
By, THE HONOURABLE MR. S.S. KANG
By, VICE PRESIDENT & THE HONOURABLE MR. P.K. JAIN
By, MEMBER (TECHNICAL)
For the Appellants: N.D. George, Advocate. For the Respondent: K.S. Mishra, Addl. Commissioner (A.R.).
S.S. Kang, J.
1. Heard both sides.
2. The appellants filed this appeal against the impugned order passed by the Commissioner(Appeals).
3. The brief facts of the case are that the appellants imported a consignment and in the Bill of Entry the goods were declared as re-conditioned components of photocopier mainframes consisting of functional gear, feeding rods, fixing rulers, scanner, clutches and motors etc. The appellants declared the cif value of the goods as Rs. 10,78,731/-. On examination of the goods, Revenue is of the view that the goods in question are complete photocopier machines. The adjudicating authority enhanced the value to Rs. 19,71,648/- and also held that the goods were liable to confiscation under Sec.111(d) and Sec.111(m) of the Customs Act and allowed redemption of the goods on payment of redemption fine of Rs. 6 lakhs. A penalty of Rs. 1,50,000/- was also imposed under Sec.112(a) of the Customs Act.
4. The contention of the appellants is that the goods in question are parts and components of photocopier machines and not complete photocopier machines. Therefore, the finding that the goods in question are complete photocopier is not sustainable. It is also contended that the goods were held to be imported in violation of the ITC provisions as the second hand capital goods are restricted items. The appellants relied on the decision of the Honble Supreme Court in the case of Atul Commodities Pvt. Ltd. vs. CC, Cochin - 2009 (235) ELT 385 to submit that in respect of second hand capital goods restriction was imposed by DGFT by Notification No.31 dated 19.10.2005 and the restriction will come into force from the date of the Notification. In the present case, the import is made prior to 2005 and hence the goods are not restricted item.
5. Revenue relied upon the findings of the lower authorities and examination report where it has been found that parts and components are more than 90% and some minor parts like trays etc. are missing from some of the machines but all the machines have essential part of photocopier machines like mainframe, drum along with its components, lens etc. Revenue also relied on the reply to the query raised by the Revenue where the appellants themselves admitted tat the understanding with the supplier was that the supplier will ship the used photocopier machines in working condition and if any reconditioning or repairing is required that will done by the supplier, the prices of the photocopier machines include price of reconditioning/repairs if any. In these circumstances, the contention of the Revenue is that the goods in question are complete photocopier machines and as per the NIDB data where the value of the same model and make of the same manufacturer is higher than the declared value in the present case, hence the value is rightly made.
6. We find that the appellants declared the imported consignment as reconditioned components of photocopier machines whereas on examination it was found to be complete photocopier machines. This fact was also proved by the reply to the query where the appellants admitted that the understanding with the supplier was that the supplier will ship the used photocopier machines in working condition. In view of this, we find no infirmity in the impugned order where it has been held that the goods in question are second hand machines. In respect of valuation, we find that as per NIDB data where the same model of the machines and of the same manufacturer imported into in India during the same time, the value is higher. In view of this there is no merit in the contention in regard to the valuation of the goods.
7. In respect of confiscation of the goods on the ground that the goods are restricted item, we find that the restriction was imposed by the DGFT by Notification No.31 dated 19.10.2005 and the Honble Supreme Court in the case of Atul Commodities Pvt.Ltd. (supra) held that the restriction will come after the issue of Notification. In the present case, the import was made prior to the issue of N
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otification. Hence, we find merit in the contention that the goods were not restricted items at the time of import. Keeping in view the facts and circumstances of the case as we find that the goods in question are not restricted items therefore confiscation of the goods under Sec.111(d) of the Customs Act is not sustainable and set aside and the redemption fine is reduced to Rs. 3 lakhs (Rupees Three lakhs). Otherwise, the impugned order is upheld.