PALMON EXPORTS Vs. COMMISSIONER OF CUSTOMS, KANDLA

JUDGEMENT

(1.) As per facts on record, the appellant is unit situated in Kandla Special Economic Zone (KASEZ), having been given a letter of permission by the Development Commissioner, KASEZ for manufacture and re -conditioning of electronic items like Computer Monitor, Printers, etc. The clearances affected by the appellants to DTA units are required to be considered as imports, in terms of Para 7.3.2 of the Handbook of Procedures. The appellants accordingly, filed bill of entry for clearances of second -hand computer monitors to a DTA unit M/s. Om Enterprises by declaring the same as reconditioned parts and accessories and computer monitor. Revenue entertained a view that the said goods were actually reconditioned computer monitors and not parts and accessories of computer monitors. Accordingly, the Revenue was of the view that there is misdeclaration of the goods and also as the import of computers monitors required a licence, there was violation of policy. Accordingly, a show cause notice, dated 28 -10 -2005 was issued to the appellants proposing confiscate the seized goods under Section 111(d) of the Customs Act, 1962, along with confiscation of the vehicles which transported the said goods under Section 115(2) of the Customs Act, 1962. The notice also proposed to impose penalty on both the appellants in terms of Section 112(a) of the Customs Act. The said show cause notice culminated into impugned order passed by Commissioner vide which he has confiscated 205 second -hand Computer Monitors and 14 Central Processing Units (CPUs), totally valued at Rs. 5.50 Lakhs with an option to the appellants to redeem the same on payment of redemption fine of Rs. 1.50 Lakhs. He has also imposed penalty of Rs. One lakh on M/s. Palmon Exports and Rs. 1.50 Lakhs on Shri Sunil Lahori, Partner of M/s. Palmon Exports. Adjudicating authority has also confiscated the truck owned by M/s. Palmon Exports with an option to redeem the same on payment of redemption fine of Rs. 50,000/ -.

(2.) SHRI A.V. Naik, learned advocate appearing for the appellants submits that the appellants were allowed by the Development Commissioner, KASEZ to manufacture and recondition the electronic items like Computer Monitors, Printers, etc. As such, they were eligible to import second -hand computers without any restriction. The allegations of violation of exim policy are incorrect inasmuch as these items are not prohibited items. He has drawn our attention to the fact that monitors are classifiable under Customs Tariff Heading 8471 60. By drawing our attention to the said entry, it stands contended that the same is freely importable. For supporting his contention on the above point, he draws out attention to the Director General of Foreign Trade (DGFT) Policy Circular No. 29/2005 -09, dated 6 -10 -2005, vide which reconditioned computer monitors are classifiable under Heading 8471 60. He submits that Commissioner has not referred to any policy provisions restricting the imports of the goods in question.

(3.) AS regards the charge of misdeclaration, he submits that they have declared the goods as reconditioned parts and accessories of monitors instead of describing the same as Computer Monitors. He submits that this was an unintended mistake on their part, inasmuch there is no revenue implication. Import of goods under Chapter Tariff Heading 8473 30.99, under which parts and accessories are classifiable as well as under the Customs Tariff Heading 8471 60 are eligible for free import Exim Policy. Inasmuch as the misdeclaration if any would not affect the appellant, the same should be made technical ground for confiscation of the goods.