Suman Jewellery and anr. Vs. Cc - Court Judgment

Excerpt:
1. these appeals are filed against the same adjudication order and, therefore, are being taken up together.2. brief facts of the are that the appellants, m/s. suman jewellery, placed on order for supply of gold jewellery to m/s. deepu jewellers.the gold jewellery was imported into india and the bill of entry was filed on 27.4.1994. the benefit of notification no. 117/94-cus was claimed by the importer. importer also produced special import licence in respect of the goods, in question. the customs authorities informed the importer that special import licence was not valid for the import of gold w.e.f. 1.4.2001 and the gold jewellery could be imported against a specific import licence. in response to this objection, the importer made a request to re-export the gold jewellery. the commissioner of customs, in the impugned order, rejected the request for re-export and confiscated the goods under section 111(d) of the customs act and gave option to redeem the goods on payment of redemption fine of rs. five lakh and imposed a penalty of rs. one lakh on m/s. suman jewellery.3. the contention of the appellants is that it is well-settled that when the goods are confiscated because of itc prohibition in terms of section 111 of the customs act and an option to pay fine in lieu of such confiscation is given, the fact of such option is to lift the prohibition and when the goods are allowed to re-export, the imposition of fine and penalty is not justified. their submission is that when the order was placed for supply of the goods, the importer had a valid special import licence and when the goods were imported into india, the facility of special import licence was withdrawn. their further contention is that in spite of requirement of specific import licence for import of gold in any form, notification no. 117/94 cus, which was issued on 27.4.1994, provides concessional rate of duty subject to condition that goods, in question, is covered by the special import licence. in this situation, the goods imported under the bona fide belief that they are covered under the special import licence. they relied upon the decision of the tribunal in the case of alukkas exporters v. cc reported in 2002 (48) rlt k311.4. the contention of the revenue is that the goods were not covered by the special import licence. therefore, they are rightly liable for confiscation. their contention is that when the importer has option to redeem the goods on payment of redemption fine, he can only re-export the goods after payment of redemption fine and duly and claim draw- the goods after payment of redemption fine and duly and claim drawback upto 98 per cent of the duty under sec. 74 of the customs act.5. the facts of the present case are peculiar in nature. the facility of special import licence was withdrawn from 1.4.2001 and the bill of entry was filed on 26.4.2001. at the time of place the order in respect of the goods, in question, the facility of special import licence was available in respect of the gold jewellery. in a similar situation, in respect of import export policy, which was amended w.e.f. 1.4.2001, the tribunal in the case of alukkas exporters (supra), allowed re-export of the gold jewellery without fine & penalty. while allowing the re-export, the tribunal relied upon the earlier decisions in the case of m/s. hcl hewllet packard ltd. v. cc shubh gems v. cce 6. in view of the above decisions of the tribunal and taking into consideration the facts and circumstances of the present case that when the goods, in question, had been allowed to re-export, the question of imposing any redemption fine and penalty does not arise, therefore set aside the same and allow the re-export of goods without any redemption fine or penalty. the appeals are allowed.

Judgment:
1. These appeals are filed against the same adjudication order and, therefore, are being taken up together.

2. Brief facts of the are that the appellants, M/s. Suman Jewellery, placed on order for supply of gold jewellery to M/s. Deepu Jewellers.

The gold jewellery was imported into India and the bill of entry was filed on 27.4.1994. The benefit of notification No. 117/94-Cus was claimed by the importer. Importer also produced special import licence in respect of the goods, in question. The Customs authorities informed the importer that Special Import Licence was not valid for the import of gold w.e.f. 1.4.2001 and the gold jewellery could be imported against a Specific Import Licence. In response to this objection, the importer made a request to re-export the gold jewellery. The Commissioner of Customs, in the impugned order, rejected the request for re-export and confiscated the goods under Section 111(d) of the Customs Act and gave option to redeem the goods on payment of redemption fine of Rs. five lakh and imposed a penalty of Rs. one lakh on M/s. Suman Jewellery.

3. The contention of the appellants is that it is well-settled that when the goods are confiscated because of ITC prohibition in terms of Section 111 of the Customs Act and an option to pay fine in lieu of such confiscation is given, the fact of such option is to lift the prohibition and when the goods are allowed to re-export, the imposition of fine and penalty is not justified. Their submission is that when the order was placed for supply of the goods, the importer had a valid Special Import Licence and when the goods were imported into India, the facility of Special Import Licence was withdrawn. Their further contention is that in spite of requirement of Specific Import Licence for import of gold in any form, notification No. 117/94 Cus, which was issued on 27.4.1994, provides concessional rate of duty subject to condition that goods, in question, is covered by the Special Import Licence. In this situation, the goods imported under the bona fide belief that they are covered under the Special Import Licence. They relied upon the decision of the Tribunal in the case of Alukkas Exporters v. CC reported in 2002 (48) RLT K311.

4. The contention of the revenue is that the goods were not covered by the Special Import Licence. Therefore, they are rightly liable for confiscation. Their contention is that when the importer has option to redeem the goods on payment of redemption fine, he can only re-export the goods after payment of redemption fine and duly and claim draw- the goods after payment of redemption fine and duly and claim drawback upto 98 per cent of the duty under Sec. 74 of the Customs Act.

5. The facts of the present case are peculiar in nature. The facility of Special Import Licence was withdrawn from 1.4.2001 and the bill of entry was filed on 26.4.2001. At the time of place the order in respect of the goods, in question, the facility of Special Import Licence was available in respect of the gold Jewellery. In a similar situation, in respect of Import Export Policy, which was amended w.e.f. 1.4.2001, the Tribunal in the case of Alukkas Exporters (supra), allowed re-export of the gold jewellery without fine & penalty. While allowing the re-export, the Tribunal relied upon the earlier decisions in the case of M/s. HCL Hewllet Packard Ltd. v. CC Shubh Gems v. CCE 6. In view of the above decisions of the Tribunal and taking into consideration the facts and circumstances of the present case that when the goods, in question, had been allowed to re-export, the question of imposing any redemption fine and penalty does not arise, therefore set aside the same and allow the re-export of goods without any redemption fine or penalty. The appeals are allowed.