EMS Technologies Pvt Ltd Vs CC & CE (Dated: September 28, 2016)

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Camilla Hunt
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1 CESTAT RULING 2016-TIOL-2686-CESTAT-MUM Mahavir Spinning Mills Ltd Vs CC (Dated: March 15, 2016) Cus - Appellant imported "Datacolour Autolab 32, Laboratory Dispenser and Solution Maker" and claimed classification under of CTA, Assessing officer classifying goods under residuary category heading 'Machines & Mechanical Appliances' [84.79] rejecting alternate classification of sought by appellant - Commissioner (A) rejecting claims of appellant - appeal to CESTAT. Held: Residuary category is intended to cover goods, machines and mechanical appliances not specified or included in the chapter but, nevertheless having individual functions that are not specifically identified - Item under import is a laboratory dispenser and solution maker with single 12 position turntable to enable the dispensing a combination of colours as a solution - It is intended to achieve fast, accurate and repeatable dispensing of recipes and the preparation of solutions with great precision - Therefore, it would appear to be an instrument - Further, without any human intervention, the dispenser starts, operates and stops at pre-set intervals, hence, the classification claimed under as 'automatic regulating or controlling instruments and apparatus' is also distinct possibility - in terms of rule 3(c) of the General Rules for Interpretation of the Import Tariff, impugned goods are correctly classifiable under Impugned order set aside & Appeal allowed: CESTAT [para 5, 6] 2016-TIOL-2685-CESTAT-MUM CC Vs British Electricals (Dated: August 31, 2016) Cus - Whether LED panel indicator imported by respondent is classifiable under Heading as claimed or under as assessed by department - respondent being aggrieved with the assessment filed appeal and the Commissioner (A) allowed the appeal - Revenue in appeal before CESTAT seeking classification of goods under heading AR pleading that the same is a typographical error but respondent submitting that since the Revenue has not challenged the assessment before the Commissioner(A) they cannot come before the Tribunal with a plea for classification under a third Tariff item. Held: If at all any appeal is maintainable before the Tribunal, the same should be on the issue of conflicting tariff headings viz. between and Department is not allowed to file appeal before the Tribunal claiming some third tariff item number since no substance in Revenue appeal, the same is dismissed: CESTAT [para 4] 2016-TIOL-2682-CESTAT-MUM EMS Technologies Pvt Ltd Vs CC & CE (Dated: September 28, 2016) Cus - Customs Valuation Rules, No royalty whatsoever has been paid and, therefore, the question of addition of royalty to assessable value becomes irrelevant - Issue is only of an academic interest - Appeal disposed of as it has no effect on any party: CESTAT [para 4] 2016-TIOL-2674-CESTAT-DEL-LB

2 All India Glass Manufacturers Federation Vs UoI (Dated: September 6, 2016) Anti Dumping Duty - Appeals filed against final findings of Designated Authority dated 17/02/2012 and final findings dated 09/2/2013 on imposition of AD duties on subject goods when imported from China PR, European Union, Kenya, Iran, Pakistan, Ukraine and USA as well as Turkey and Russia respectively - AD duty imposed on Soda Ash is being contested by appellants - Main issue which formed basis of appeal is that there is no price injury to Domestic Industry as sale price is higher than NIP - Fall in profit of DI is not attributable to import of subject goods - There is no legal provision to mandate DA to compare NIP with NSR in order to determine price effect - NSR is not the only parameter to decide on AD duties - Other price effects of imports such as price suppression and price depression are to examined which have been specifically examined by DA in his findings dated 17/2/ He concluded that there is a price suppression affecting DI - It was further recorded that per unit profits of DI in respect of production and sale in domestic market has significantly declined during injury period - No merit found in present appeals, accordingly, same are dismissed: CESTAT 2016-TIOL-2668-CESTAT-MUM S Rajiv And Co Vs CC (Dated: July 26, 2016) Cus - Excess quantity of diamonds shipped by the supplier and which value is more than Rs.1.5 crores - adjudicating authority confiscating the goods and imposing redemption fine of Rs.50 lakhs and penalty of Rs.5 lakhs; re-export allowed of excess goods - appeal to CESTAT. Held: Appellant relying upon the explanation given by the supplier that excess goods was meant for supply to Hong Kong as there was a similar quantity short shipped to Hong Kong party - If such a serious mistake occurred, the same should have been intimated to the appellant immediately whereas all the explanations were brought before the department only when the excess quantity was detected and this shows that the explanation is an afterthought - Even if it is presumed that there is a bonafid e mistake, for the purpose of alleging mis-declaration, mens rea is not required and consequences follow - goods have been correctly held liable for confiscation - element of mens rea is only a parameter to decide the quantum of fine and penalty - as against goods declared correctly and valued at Rs.3,54,82,085/-, excess goods is valued at approximately Rs.1.5 crore - redemption fine and penalty imposed of Rs.50 lakhs and Rs.5 lakhs is, therefore, reduced to Rs.30 lakhs and Rs.3 lakhs respectively - appeal partly allowed: CESTAT [para 9] 2016-TIOL-2667-CESTAT-MUM Harchandani Choith Nanikram Vs CC (Dated: August 1, 2016) Cus - Undeclared currencies collectively equivalent to INR Rs.38,00,671/- recovered from appellant when he was intercepted by the officers of AIU at CSI Airport, Mumbai - Absolute confiscation ordered by adjudicating authority along with imposition of penalty - appeal to CESTAT. Held: Appellant at every stage has given a wrong statement about source of currencies - as per RBI and FEMA provisions, export of currencies is subject to approvals and permission, therefore, attempt of export of currencies without such approvals/permissions leads to confiscation - looking at the conduct of the appellant and nature of the offence, the adjudicating authority has rightly not allowed redemption of currencies to the appellant - even if the submission of the appellant is accepted that the confiscated currencies can be redeemed on payment of fine, but the same is subject to the discretion of the adjudicating authority as per the clear interpretation of section 125 of the Customs Act, there is nothing wrong in the decision of the adjudicating authority - impugned order is upheld and appeal is

3 dismissed: CESTAT [para 5] 2016-TIOL-2666-CESTAT-MUM Ferromatik Milacron India Ltd Vs CC (Dated: August 31, 2016) Cus - At the time of assessment, the assessing authority has disputed price and arrived at the value following Rule 8 of the Customs Valuation Rules, method adopted for valuation of old imported machinery does not appear to be incorrect - appellants have admitted and paid customs duty as assessed by the assessing authority and no protest was lodged; appellant has also not challenged the assessment of Bill of Entry - Once the Bill of Entry has been assessed after enhancement of the value and importer has paid the duty, refund cannot be claimed by the importer without challenging the assessment of Bill of Entry no infirmity in order appeal dismissed: CESTAT [para 4] 2016-TIOL-2658-CESTAT-MUM Husco Hydraulics Pvt Ltd Vs CC (Dated: August 2, 2016) Cus - Valuation - Commissioner (Appeals) modified the order -in-original dated and held that there was no case for addition of royalty payment in assessable value of the goods under Rule 10(1)(c) of the Customs Valuation Rules, Revenue in appeal on the ground inter alia that Commissioner (A) has not stated as to how the decision of apex Court in Matsushita Television TIOL-64- SC-CUS is not applicable; that the royalty is paid on ex-factory sale price of goods and that includes the cost of imported components; that since cost of imported components was included in the ex-factory sale or product, it becomes a condition for sale of finished goods and, therefore, royalty should be added to the Transaction value. Held: It is undisputed that the royalty is paid on a value inclusive of the value of the imported goods - From clause 5 of the Article of definition section of the licence agreement, it is crystal clear that the net sale price on which 3% royalty is paid by the appellant is without deduction for components imported from HUSCO - in other words, value of imported goods is included in the net sale price of appellant's manufactured goods - in view of this undisputed fact, it is apparent that the decision of the apex court in the case of Matsushita Television TIOL-64-SC-CUS is squarely applicable to the present case - Revenue appeal allowed: CESTAT [para 4.8, 5] 2016-TIOL-2656-CESTAT-DEL-LB Alkali Manufacturers Association Of India Vs Designated Authority (Dated: September 5, 2016) Cus - Anti-dumping duty - Notification 142/2003-Cus - Position of "Equal Economic Importance" cannot be given to chlorine in the Indian context as compared to caustic soda and thus cannot be treated as joint product - DA treating chlorine as a byproduct to arrive at a finding is justified - Appeals dismissed: CESTAT [para 15, 16] 2016-TIOL-2655-CESTAT-BANG Electro Systems Associates Pvt Ltd Vs CC (Dated: July 1, 2016) Customs - Import and export of test and measuring equipment under ATA Carnet

4 facility in terms of Notification No 157/1990-Cus for exhibition purpose - Refund claim - Extension of time for re-export - Grant of - Export has been made after the time limit of six months but within a period of one year from the date of import - Said period of export is deemed to have been extended by another six months in terms of Proviso to clause 4 to the Notification- Customs duty paid on said items held unsustainable hencerefund of the duty allowed - However, in respect of second consignment of goods when re-export was made after one year of its import refund of duty rightly rejected. (Para 5, 6, 7) 2016-TIOL-2636-CESTAT-MUM Sanjay Suryani Patyani Vs CC (Dated: September 9, 2016) Cus - Charge against appellants is they were involved in forgery of documents and clandestine clearance of electrical apparatus from Customs - Appellants were penalized for their role in duty evasion involving six other persons who too were penalized; however no appeals were filed by them duty has been demanded without specifying the persons from whom it is to be required - appellants submit that no prosecution has been lodged against them and no charge sheet has been filed by the Crime Branch of Police although more than sixteen years have passed; they plead for leniency. Held: Appellants were clerk/assistants in the office of the CHA and have indeed played a role in the clandestine clearance/forgery of the documents - considering the facts of the case & status of the appellants, penalty of Rs.2 lakhs is harsh, same reduced to Rs.50,000/- per appellant - appeal partially allowed: CESTAT [para 4] 2016-TIOL-2632-CESTAT-MUM Indian Seamless Metal Tubes Ltd Vs CCE & C (Dated: March 8, 2016) Cus - Notfn. 28/97-Cus - DGFT amended the terms of licence to waive condition of installation - since requirement of installation had been done away with, scope of contravening that condition was eliminated - duty liability ceases to exist - Appeal allowed: CESTAT [para 9] 2016-TIOL-2631-CESTAT-MUM Pruti Sakhar Karkhana Ltd Vs CC (Dated: September 2, 2016) Cus - Import of Steam Turbine gear box and spares - whether appellant entitled for simultaneous benefit of notification 21/2002-Cus and notification 6/2002-CE. Held: Tribunal in the case of Triveni Engineering TIOL-638-CESTAT-BANG (and which decision has been affirmed by Supreme Court) has held that exemption under notification 6/2000-CE or 6/2002-CE cannot be extended to turbine which converts heat energy into rotational energy (kinetic energy) - following the same, exemption cannot be extended to appellant of notification 6/2002-CE for the purpose of calculation of CVD - appeal dismissed: CESTAT [para 4] 2016-TIOL-2622-CESTAT-CHD

5 Golden Enterprises Vs CCE & ST (Dated: July 12, 2016) Cus - Classification - Assessee has imported two consignments of goods declaring as PDO - Suspecting mis-declaration, DRI forwarded samples of goods from both consignments to CRCL Laboratory for testing - Commissioner in impugned order relied on chemical examiner reports which stated that samples have characteristics of 'base oil' - Chemical examiner were not in possession of any technical literature about the product PDO and has not categorically given his finding or answer the memo - He has only indicated that goods have characteristics of 'base oil' without giving his opinion whether goods were in fact 'base oil' or were PDO - Cross Examination of chemical examiner by assessee before Adjudicating Authority would have enabled them to seek categorical answers but this opportunity was denied to assessee which leads to serious mis-carriage of principles of natural justice - In absence of conclusive evidence of mis-declarations, Customs Authorities should have gone with declaration and finalized the assessments. Valuation - Commissioner in impugned order has rejected declared value under Rule 12(1) of Customs Valuation Rules, 2007, r/w Section 14(1) of Customs Act - This has been done considering that goods have been mis-declared to be PDO - Consequently, Adjudicating Authority has proceeded to re-determine the value on basis of price of 'base oil' imported contemporaneously - Mis-declaration in imported goods have not been established - Consequently, there is no basis to disregard the declared value: CESTAT 2016-TIOL-2613-CESTAT-MUM SR International Vs CC (Dated: August 18, 2016) Cus Refined Paraffin Wax imported by appellant and exemption claimed of SAD in terms of notification 56/1998-Cus since declaration for availing modvat credit was filed, lower authority contended that the importer claimed double benefits and which is not available. Held: Appellant claimed exemption of 4% SAD under Notification No. 56/98-Cus dated 13/06/98 for which they have filed a declaration as per condition - As regards the declaration under Rule 57A of the CER, 1944, this declaration was filed in respect of CVD paid as the appellant intended to pass on the Modvat credit - In view of this fact, appellant has not violated any provision and availed double benefits - Both the declarations are independent and filed for different purposes - neither in the original order nor in the impugned order any reason is given to show that the appellant has got double benefits appellant has correctly claimed exemption - order set aside and appeal allowed: CESTAT [para 4]

2015-TIOL-1036-CESTAT-MUM IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH, MUMBAI COURT NO.I

2015-TIOL-1036-CESTAT-MUM IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH, MUMBAI COURT NO.I Appeal No.ST/85482/14 & ST/86082/14 Arising out of Order-in-Appeal No. PUN-EXCUS-003-APP-316-13-14