1. Both these appeals arise from a common Order-in-Original No. 43/96 dated 16.5.96 passed by Commissioner of Customs, Madras confirming the allegations made out in the show cause notice dated 22.3.96 issued after investigation carried out by officers of DRI. Both the appellants are claimed to be independent importers with separate registration of their proprietary concerns under respective authorities, but however, functioning from a common place and the relationship between them is that of father and son. They filed declaration by Bill of Entry through their CHA M/s. S.K. International vide Bill of Entry No. 49303 dated 6.10.95 on behalf of importer M/s. Moorthy's International and M/s. Sri Sunder Agent, filed bill of entry No. 54227 dated 3.11.95 on behalf of M/s. Nandana International, Madras, for the clearances of consignments declared as components of telephones. The value of these consignments were declared as Rs. 4,96,424/- and Rs. 3,14,717/- respectively on the strength of the shipper's invoice No. 95/378 dated 14.9.95 and 95/379 dated 14.9.95 for US $ 14,939.70 CIF Madras and US $ 8704.50 CIF Madras respectively. The invoice in both cases were raised in favour of the importers by the shippers M/s. Nagi Lik Electronics Co. Ltd., Hong Kong. The importers sought the clearance of the same on the ground that in terms of para 22 of the Export-Import Policy for 1992-97, the goods does not require licence as parts of telephones can be imported on OGL basis. However, after the consignment of M/s. Nandana International was cleared on payment of duty on 6.11.95, while the consignment of Moorthy's International was still pending clearance,when investigation was taken up by DIR and statements recorded from R. Nanda Kumar, Proprietor of M/s. Nandana International, Madras on 14.11.95 and that of his father, proprietor of M/s. Moorthy's International, who had imported these goods. They admitted having visited Hong Kong for purpose of purchasing these components. It was revealed that they had a common office and also had a separate private limited firm dealing in manufacture of Ayurvedic products. These concerns were doing import-export business. They admitted that the consignments were stuffed in the same container and it had been purchased from the same supplier and were shipped after careful scrutiny by assigning consecutive numbers. The samples were drawn from both the consignments and forwarded to one M/s. Powerline Electronics, Madras to ascertain as to whether the parts can form a complete telephone set on assembling.
The said firm after examining the samples, opined that they were able to assemble from the said sample a complete functioning telephone of Model No. DENWA TP-206 and 'LENOX SOUND model KB 329'. These assembled sets were handed over to the investigators they were said to be model telephones in functioning condition. It was further presumed that in terms of para 156 (a) of the Export-Import Policy 1992-97 and Classification (ii) Consumer Telecommunication equipment namely telephone instruments are covered under restricted items of imports and therefore, they are not permitted to be imported except against a licence or in accordance with a public Notice issued in this behalf.
Therefore, they were charged for violating the Export-Import Policy 1992-97 by mis-declaration and with an intention to violate the provision of law in terms of Section 111 (d) of the Customs Act read with Section 3 (2) of Foreign Trade (Development and Regulation) Act 92. The gist of the allegation has been brought out by the Commissioner in para 13 of his order which is extracted herein below:- (a). M/s. Moorthy's International is a proprietory concern standing in the name of Shri K. Ramamoorthy. M/s. Nandana International was another proprietory concern standing in the name of Shri R. Nandakumar, who was the son of Shri K. Ramamoorthy. There was yet another private limited company wherein both the aforesaid father and son were Directors, among others. These concern/company are housed in a common premises at No. 787/2, Anna Salai, TNEB Avenue, Madras-2.
(b). Admittedly, Shri K. Ramamoorthy alongwith his son, Shri R. Nandakumar went to Hong Kong during July, 1995 and visited several suppliers of electronic items, including the one M/s. Ngai Lik Electronic co., Limited, Hong Kong, who was none other than the same shippers of the subject consignment covered under Bills of Entry No.s 49303/6.10.95 and 54227/3.11.95.
(c). Thereafter, the import of telephone instruments was made from the said shippers, by arranging split consignments in two lots consisting of components of telephones in disassembled condition - one lot consigned in the same of M/s. Moorthy's International (which stands in the name of the father) certain telephone components, and the other consigned in the name of M/s. Nandana International (which stands in the name of his son) for the balance components, under two consecutive invoice nos. 95/378 dated 14.5.95 and 95/379 dated 14.5.95 respectively raised by the very name shippers viz., M/s.
Ngai Lik Electronic Co. Ltd., Hong Kong.
(d). That the consignment in two lots as mentioned earlier is the result of wilful split-up was also clearly evident from the fact that M/s. Powerline Electronics, Madras were able to form complete and fully functioning telephone instruments of both models viz., 'DENWA - TP 206' and 'LENOX SOUND K-B 329', on assembly using the official sample components drawn from the subject consignments covered under Bills of Entry Nos. 49303/6.10.95 and 54227/3.11.95, without adding any components from outside.
(e). The consignments stuffed in the same container No. HJCU 8585595 and arrived per vessel m.v. KOTA RAJYAT V.107 at Madras, were mis-declared to the Customs as telephone components so as to attract lesser rate of Customs duty, under two Bills of Entry Nos.
49303/6.10.95 and 54227/3.11.95 filed in the names of M/s. Moorthy's International and M/s. Nandana International respectively. Such mis-declaration had, in addition, unduly facilitated the importers to claim clearance of the goods (components) without production of a licence for the said import, circumventing the provisions of para 156 A (ii) of the Export-Import Policy 1992097 as per which consumer electronic equipments viz. telephone instruments were not permitted to be imported except against a licence or in accordance wit a Public Notice issued in this behalf.
(f). The wilful intent on the part of the importers M/s. Moorthy's International and M/s. Nandana International, was evident from the fact that no licence was obtained as required under para 156 A (ii) of the Export-Import Policy 1992-97 for the import of the said goods and that the clearance of the same were sought as components by deliberate split-up of consignments so as to attract lesser rate of Customs duty instead of actually declaring them as telephone instruments in disassembled/SKD condition, classifiable under Heading 85.17 of the Customs Tariff.
(i) The goods covered under Bill of Entry No. 49303 dated 6.10.95 and 54227 dated 3.11.95, (new under detention), were liable to confiscation under (a) Section 111(d) of the Customs Act, 1962 read with Sec. 3(2) of the foreign trade (Development & Regulation, Act, 1992, in as much as that eventhough they are covered under the restricted category of gods, they had been imported without a licence in violation of export and Import Policy 1992-97 vide para 156 A(ii) thereof; and also (b) Sec.111(m) of the Customs Act, 1962, in as much as the said goods imported do not correspond with regard to description declared in the said Bills of Entry.
(ii). M/s. Moorthy's International and M/s. Nandana International are jointly and severally liable to pay a total duty of Rs. 4,31,447/- being the differential duty short-paid on the telephone instruments, the components of which were covered under Bill of Entry No. 54227 dated 3.11.95 filed by M/s. Nandana International (which has been cleared by mis-declaration, but now under detention) under Sec. 28 of the Customs Act, 1962, and also Bill of Entry No. 49303 dated 6.10.95 field by M/s. Moorthy's International (which was pending clearance).
(iii). M/s. Moorthy's International and its Proprietor Shri K. Ramamoorthy are liable to penalty under Section 112(a) of the Customs Act, 1962 in as much as the goods imported under Bill of Entry No. 49303/6.10.95, are liable to confiscation under Section 111 of the Act, ibid.
(iv). M/s. Nandana International and its Proprietor Shri R. Nandakumar are liable to penalty under Section 112(a) of the Customs Act, 1962 in as much as the goods imported under Bill of Entry NO. 54277 dated 3.11.95 are liable to confiscation under Section 111 of the Act ibid.
(i) M/s. Moorthy's International and its Proprietor Shri R. Ramamoorthy and M/s. Nandana International and its Proprietor Shri R. Nandakumar both at 787/2, Anna Salai TNEB Avenue, Madras-2, are hereby called upon to show cause to the Commissioner of Customs, Custom House, Madras, within 30 days of the receipt of this Notice as to: (a). Why the import consignments covered under both Bills of Entry Nos. 49303 dated 06.10.95 filed by M/s. Moorthy's International and 54227 dated 3.11.95 field by M/s. Nandana International, should not be confiscated under Section 111(d) and 111(m) of the Customs Act, 1962 read with section 3(2) of the Foreign Trade (Development & Regulation) Act, 1992.
(b) Why a total duty of Rs. 4,31,447/- (Rupees Four Lakhs thirty one thousand four hundred and forty seven only) being the differential duty short-paid on the goods viz. telephone instruments in disassembled/SKD condition covered under Bills of Entry Nos. 49303 dated 6.10.95 filed by M/s. Moorthy's International (which is pending clearance) and 54227 dated 3.11.95 filed by M/s. Nandana International (which has been cleared by mis-declaration, but now under detention) should not be demanded under Sec.28 of the Customs Act, 1962, jointly and severally and (c). Why a penalty should not be imposed under Sec. 112(a) of the Customs Act, 1962, separately on: (2). Shri K. Ramamoorthy, Prop. M/s. Moorthy's International, Madras.
2. Both the appellants filed their reply contending that they are independent firms and the relationship of father and son will not come in the way of their functioning as independent importers as per law.
They had independently negotiated and purchased the components parts which could be imported without licence. They denied the allegation that they had imported telephone instruments without licence. M/s.
Moorthy's International categorically pointed out that he had a valid special import licence No. OA 0129052/28.11.95 for the import of one of the restricted item, i.e. PCB sets for telephones, which by value constitutes about 40% of the consignment imported. Their main plea was that they did not admit that they had imported telephone instruments in CKD or SKD condition to violate the OGL Policy. They submitted that they did not any facility for manufacturing, assembling and for selling the telephone instruments. They were to dispose of only as parts as it was permissible. They relied on the judgment of the Apex Court rendered in the case of UOI Vs. Tarachand Gupta and Bros. Reported in 1983 ELT 1456(SC) and referred to the following portion of the order:- "Under Entry 295, except for rubber tyres and tubes, there are no limitations as to the number of kind of parts or accessories which can be imported under a licence obtained in respect of the goods covered thereunder. Prima Facie, as importer could import all the parts and accessories of motor cycles an scooters and it would not be a ground to say that he has committed a breach of Entry 295 or the licence. The mere fact that the goods imported by them were so complete that when put together would make the motor cycles and scooters in C.K.D. condition would not amount to a breach of Entry 295. Nor such a meaning can be given to Entry 295 unless there is in it or in the licence a condition that a licence is not to import parts in such a fashion, his consignments different though they may be, when put together would make motor cycles and scooters in C.K.D. condition. Thus the restriction not to import motor cycles and scooters in CKD condition was against an importer holding a licence in respect of goods covered by Entry 294 under which is could import complete motor cycles and scooters and not against an importer who had a licence to import parts and accessories under Entry 295.
Therefore the respondent was not liable to payment of fine and penalty for breach of Section 3 of the Imports Exports (Control) Act, or Section n167 (8) of the Sea Custom Act".
They further submitted that in the case of Susha Electronic Industries Vs. CCE reported in 1989 (39) ELT in a similar circumstances, the West Regional Bench had laid down a clear guidance as to how to deal a situation of the kind like this and quoted the following para:- "Undisputedly, sub-assemblies, speakers, twitters, antenna, remote control, pressed and punched parts were imported under specific licences. The clearance of these parts cannot be objected to.
Admittedly, the components sought to be cleared in Kandla Port are OGL items and the appellant firm being actual users are eligible to import the components sought to be cleared at Kandla Port are OGL items and the appellant firm being actual user are eligible to import the components sought to be cleared at Kandla Port. These components cannot be objected to on the ground that they require import licence. The components sought to be cleared at Kandla Port were not having the essential character of the complete or finished article. The essential parts of T.V. sets were not found among the components imported at Kandla. In the circumstances, Section 16, Chapter 84 and 85 of Harmonised Tariff and rules of interpretation will be of no assistance. When the policy permitted import of all components of T.V. sets, some against licences and some under OGL, the Collector has no jurisdiction to object to the clearance of the OGL items on the ground that those items if clubbed with other items imported against licences would constitute T.V. sets in SKD condition (1983 ELT 1456 (SC) relied on".
i) Ronuk Industries Vs. CC Bombay - 1985 (22) ELT 572 wherein it has been laid down that import licence is to be interpreted as such restrictions not stipulated therein as not imposable.
ii) Jain Exports (P) ltd. and another Vs. UOI & Ors.- 1987 (29) ELT 753 wherein it has been laid down that a vested right has been conferred under a licence to import goods unless statutory provisions are to the contrary. Therefore, they seriously objected to the proposal to club independent imports made by them as a single consignment and the whole proceeding was not in terms of law as they had no such intentions to violate the policy or to sell the items after assembling as telephone instruments in view of their not having any factory or assembly line.
3. The Commissioner rejected all their pleas and also examined the case law to distinguish the judgments brought before him. he has noted that the appellants had admitted not only to circumvent the policy but also tax evasion as a higher rate is applicable on the finished product and the components attract lesser rate of duty. A complete set can merely be assembled and sold. Although the importers are not manufacturers, yet if this practice is allowed to continue, then it will lead to perpetual loss of revenue to the government besides circumventing the policy of import. He has relied on the judgment of the Apex Court in the case of Sharp Business Machines Pvt. Ltd. Vs. CC [1990 (49) ELT 640] wherein the appellant import who admitted to import of restricted items in complete set in SKD condition was held to be a device adopted by the appellants to play fraud on the import policy indirectly. he has also not agreed with the contention raised by them that they are two independent and different legal entities. He has noted in para 25 of his order that "normally when an importer imports all the components/parts which will constitute a complete set there should not be any problem in taking the stand as has been taken in this case. But when two different legal entities are involved the point for consideration is whether it has to be treated independently or together. What strikes me her is that though the importers are two different legal entities, the premises is common and components imported separately, when assembled together constitute an exact number of finished product. 'this only shows that the arrangement is merely to circumvent the law in nan ingenious and an apparently legalistic manner. In this context one has to draw inspiration from the case of Juggilal Kamlapati Vs. Commissioner of Income Tax, UP in AIR 1969 SC 932 (V 56 C 169) wherein the Hon'ble Supreme Court has upheld the principle that the judicial authorities have the power to disregard the corporate entity if the conception is used for tax evasion or to circumvent tax obligation or to perpetrate fraud" 4. After so holding, he as passed the order of confiscation, however granting redemption on payment of fine of Rs. 1,00,000/- to each of the appellants and imposing penalty of Rs. 25,000/- each.
5. The appellants were argued by Shri A.K. Ramchandran and Shri S.S.Radhakrishnan, Advocates. They reiterated the stand taken by the appellants before the authorities and also relied on the same judgments. They contended that both were independent firms and had filed separate Income Tax returns and Sales Tax returns. They have produced all the copies of the documents to show that they were independently legal entities with separate certificate of registration and that M/s. Moorthy's International had the licence to import the most important and crucial part, i.e. PCB component which is expensive and constituting 40% of the consignments. They pointed out that the Ld.
Commissioner has conveniently not answered on this aspect and has not considered the plea that appellants did not have any facility to assemble and they were only traders. it was pointed out that the investigation stopped only by putting question to both of them about their visit to Hong Kong and buying from the same supplier and getting it transported through the same shipper in the same consignment. It was argued that there are large number of other importers also who import and the same container is used to stuff the import of imported items in packed condition, in the same container. They contend that although the Commissioner has stated that in terms of the Supreme Court judgment cited in para 25, the authorities have the power to disregard the corporate entity if the conception is used for tax evasion or to circumvent tax obligation or to perpetuate fraud. In this connection they pointed out that except quoting this citation, no evidence has been cited by the authorities in the show cause notice or evidence adduced about any modus operadni to evade the scheme of export policy.
Merely because they were related and having a common office that by itself will not give a presumption that they were to assemble and sell the same as telephone equipments, more particularly Moorthy's International holds licence for 40% of import of PCB components. The counsels took us though the statements of both the persons and showed that there was no admission on their behalf nor they had said that they were importing it with an idea to assemble and sell the same as telephone equipment. Both of them had denied to the question posed in this regard, by the authorities, saying that Moorthy's International had licence to import PCB components which constitute 40% of the imported consignment and they were under the clear impression that export policy allow them to import the components. Therefore, they submit that the Commissioner has not applied his mind, although he has merely attempted to distinguish the judgments without noting that the judgments of UOI Vs. Tarachand Gupta & Bros. (supra) completely applies to the facts of this case including that of the Tribunal judgment rendered in the case of Susha Electronics Vs. CC (supra). The judgment of Ronuk Industries Ltd. (supra) and that of Jain Export Pvt. Ltd. (supra) were also strongly relied to show that the same had total applicability to the facts of this case. They also relied on the judgment of the Calcutta High Court rendered in the case of Opal Exports Pvt. Ltd. Vs. CC [1992 (60) ELT 232 (Cal.) wherein in a similar circumstance when parts of measuring instruments were imported in two consignments by the same vessel by the same importers and when combined together would make a complete measuring instrument, yet it was held that the goods were only spares and not complete instrument. He submits that their case is far better as they were two independent entities while the Calcutta High Court gave relief to the party who had imported the parts in two consignments. Further reliance is also made on the Decor India & Ors. Vs. CC, New Delhi [1987 (31) ELT 400 rendered by the Tribunal. On the aspect of valuation also, they relied on the judgment of Janta Traders, Bombay Vs. CC, Bombay [1987 (13) ECR 685 (CEGAT, SB-A); Ganeshrajah Organisations Vs. CCE [1991 (56) ELT 830 (Trib.)], Ghanshyam Chejra Vs. CC [1989 (44) ELT 202 (Cal.) wherein also clubbing of clearances was not permitted by the High Court for the reasons given therein. Similar view was expressed by Calcutta High Court in Trident Television Pvt. Ltd. Vs. CC [1990 (45) ELT 24-Cal.], Ghanshyam Chejara Vs. CC & Ors. [1993 (46) ECR 68 (Cal.); & Menon Associates Vs. CC, Bombay [1988 ELT 367 (Trib.)].
6. Counsels pointed out that the judgment on Sharp Business Machines (supra) is clearly distinguishable as it is a case of under-valuation on the basis of quotations instead of invoices and wherein the Apex Court after due consideration, held that invoice price is ignorable and in view of the fact that the import had been done on the basis of SKD/CKD conditions in the guise of parts and accessories under the phase manufacturing scheme of import policy. This judgment was not on the lines as in the present case of clubbing of two independent importer's consignments and there is a wrong application of the judgment. Therefore, they seek for setting aside the order of confirming the demands.
7. Ld. D.R. Shri Arumugam defended the order in the lines in which it has been reasoned out by the Commissioner in his order. He strongly relied on all the points relied, investigation report and the charge made out in the show cause notice. He pleaded that it was a clear conspiracy of father and son to form two units with a view to import telephone equipments and to sell the same after assembling. At a pointed question as to whether there was any investigation carried out on these lines to show as to how they were to assemble and to whom they were to sell the sets, Ld. D.R. after perusal of the records, contended that except the two statements and the Mahazar recorded, there was nothing further on record. On further query as to why no findings have been recorded on the licence for PCB components which according to the appellants constitute 40% of the import, Ld. DR merely reiterated the plea on the ground that this aspect has been rightly ignored in view of the facts that the imported item on being seized and sample sent of examination, and the examination report proving that the telephone equipment can be assembled, therefore the plea of licence for PCB components losses significance and much importance may not be given for the same. On a further query from the bench as to how the various judgments could be distinguished, Ld. DR pointed out that Sharp Business Machines applies, although in that case the issue was under-valuation of the equipments and licence issue was not there, yet the corporate veil can be lifted to arrive at the conclusion. On a query as to what revealed after lifting the corporate veil and whether further investigation was done to know to whom and whether the equipments were to be sold after assembling, Ld. DR merely reiterated the findings given by the Commissioner. Ld. D.R. referred to the provisions of Section 46 with regard to entry of goods on importation., As per proviso (2) of Section 46, the Proper officer while permitting presentation of the Bill of Entry shall also include all the goods mentioned in the Bill of lading or other receipts given by the carrier to the consigner. It is his submission that in terms of hits provision, the details given in the Bill of lading of both the importers being consecutively numbered and from the same supplier, therefore, clubbing of Bill of Entries in terms of hits Section is justified although the importers are independent. He submits that the Commissioner has rightly lifted the corporate veil to club the clearances as there is violation of Import-export policy which does not permit importation of telephone communication equipment. He pointed out that the telephone equipment were manufactured in China and it came to Hong Kong where it is dis-assembled and the same was shipped in same container by splitting the invoices and Bill of lading at the instance of the appellants.
Therefore, as there is mis-declaration and fraud played on the policy, the authorities are justified in rejecting the case of the appellants for clearances of the items as parts of telephones under OGL and treating the same as prohibited goods under the negative list of the Import-export Policy. The same required licence which had not been obtained. The licence obtained for the PCB components cannot be treated as sufficient for import purpose as it has not relevance as all the items are in CKD/SKD condition for assembly of 4500 sets of telephones.
Hence, the order is justified and requires to be upheld.8. On a careful consideration of the submission made by both the sides, we notice that the authorities have proceeded to investigate the case on information that both the appellants being related and colluded to import telephone communication sets by purchasing the same from the same supplier. The authorities had sent the sample to find out as to whether a complete telephone set can be assembled and on opinion being obtained, it was discovered that from both the consignments declared in two separate Bill of Entries, 4500 telephone sets could be assembled and they are to be treated as telephones of Model DENWA - TP 206 and LENOX SOUND MODEL KB-329 in SKD condition which cannot be imported as they are listed in the negative list of the Import-export Policy. The main contention to proceed to club the clearances of both the importers is on the basis of the judgment rendered int the case of Juggilal Kamlapati Vs. Commissioner of Income Tax, UP (supra) which had laid down the principle that judicial authorities have the powers to disregard the corporate entities if the conception is used for tax evasion or to circumvent tax obligation or to perpetuate fraud. The Commissioner while relying on this judgment has also observed in para 25 which is extracted supra that normally when an importer imports all the components/parts which will constitute a complete set, there should not be any problem in taming the stand as has been taken by the parties. But he has rejected the two importers to be independent as they are father and son and they are functioning from a common premises. We have given a careful thought to this finding and we are of the considered opinion that although to prevent fraud on Policy, the authorities are fully equipped to carry out investigation and reject the contentions of importers. But that has to be done only after full and complete investigation and sufficient evidence has been culled out and discovered to prove the fraud on the Policy. It is not denied by the Revenue that the parts can be imported and they are not under the restricted negative list. Both the appellants are independents importers although they may be related and having a common office. They have produced sufficient evidence to show their independence in the form of certificate and Income-Tax returns and Sales-Tax returns. The only factor which is relied by the investigating authorities is that both the persons had gone to Hong Kong and had booked the orders from the same supplier. The supplier had split the Bill of Lading and it had a consecutive number. On assembly of these sets, a full 4500 telephone sets can be manufactured. However, to prove this point, although they have produced the certificate of computer engineer of the assembly of a telephone from the sample drawn, but the main point required for consideration is as to whether there was a real fraud played by the appellants.
9. There are indeed various circumstances pointing to such a possibility. But apart from the two abatements record from the appellants, there is nothing on record to show that appellants were to assemble themselves or sell it to any industry who would assemble and sell 4500 sets of telephones.They have denied in their reply to the questions posed while recording the statement that they had any facility for carrying out the assembling and to manufacture of telephone sets for sale in the domestic market.They have clearly told the investigators that they were to sell it as individual parts as can be seen from their statements.They stated they were under genuine bona fide belief that parts can be imported as there was no restriction.One important plea raised by Moorthy's International is that the main part which is PCB component which constitutes 40% of the consignment has been granted with a licence and therefor,there was no question of the appellants attempting to defraud the policy and this plea has been taken by them in support of their contention that they had no facility to manufacture telephones and they were only to sell the parts which is permissible in the Policy and no restrictions are laid therein.In support theereof, they, have also relied on the judgment of the Apex Court rendered in the case of UOI Vs.Tarachand Gupta 7 Bros. Wherein, in a similar condition, clearances were granted even when the imports had been made in CKD condition.Similar views have been expressed in large number of judgments cited by them which are already noted supra which includes Calcutta High Court judgments and West Region Bench judgments. Commissioner has over-rules theses judgments and has preceded to apply the ratio of the judgment rendered in Sharp Business Machines Pvt. Ltd. case (supra). On a careful consideration, we notice that in the case of Sharp Business Machines, the allegation was pertaining to under-valuation of goods.The appellants had described the goods as parts which carried lesser duty while on examination of the consignment, it was found to be in SKD/CKD condition which had a higher rate of duty and in that circumstances, the Apex court held that the charge of under-valuation has been proved. The Commissioner has not gone into detail and recorded any finding with regard to the licence held by M/s. Moorthy's International with regard to PCB components which covers 40% of the imports.Although Section 46 has been relied, but we notice that it does not deal with more than importer importing goods.It deals only with importer making entry on importation by presenting to the Proper officer a Bill of Entry for home consumption.It also lays down the proviso where the Bill of Entry can be kept pending for clearance for reasons stated therein.The Sub Section (2) of Section 46 only states that "a Bill of Entry shall include all the goods mentioned in the Bil of Lading or other receipt given by the carrier to the consignee". In this case, although the Bill of Entry are in serial numbers, bu teach is an independent transaction and two independent invoices.It might have been shipped by a singled supplier but they are only factors which may lead to conclusion that two independent importers were importing a set of parts but what is crucial for examination is whether they colluded together to import in this manner to defraud the Policy and further to assemble 4500 sets by them by avoiding to take licence as stipulated. The authorities have not proceeded to investigate beyond taking the statements. The charge is required to be brought home by the Commissioner recording specific finding on this aspect of the matter and as to why the licence held by Moorthy's International with regard to the PCB components should not be accepted.As there is no finding with regard to this aspect of the matter and further,all the judgments cited have not been properly applied,but merely distinguished solely with a view to uphold the charger, the order is bad in law and cannot be said to satisfy the principles of natural justice.It is not a speaking order and does not deal with a clear and open mind on all the aspect of the arguments raised by the appellants, when the Apex Court is the case of UOI Vs.Tarachand Gupta 7 Bros have clearly laid down in similar circumstances that there is no violation of policy on such imports.Similar view was expressed by West Rgion Bench in Susha Electronic Industries; Ronuk Insdustires Ltd.Delhi High Court also rendered a similar view in Jain Exports Ltd. and Calcutta High Court in the following judgments having taken similar view, i.e.
10. Therefore, we are of the considered opinion that the matters had to go back for de novo consideration.The impguened order is set aside and the matter remanded to the Commissioner of Customs, Chennai to reconsider and decided the case in the light of the findings record by us.