CESTAT removes condition of testing in VRDE for release of vehicle complying stipulations for operation & running on Indian roads

Sai Charan Tours & Travels Vs Commissioner of Customs (CESTAT Mumbai)

The only issue before us is the mandate to produce the certificate insisted upon as condition for provisional release from among the prescriptions in the licencing notes pertaining to imported vehicles. The Tribunal, in Excellent Betelnut Products Pvt Ltd v. Principal Commissioner of Customs, Nagpur [final order no. A/85233/2022 dated 29th March 2022 disposing off appeal no. C/85127/2022 arising out of order-in-original no. VIII(Cus)25-169/SIIB/Betelnut Borkhedi/2021 dated 30^th December 2021 passed by the Commissioner of Customs, Nagpur], has held that the powers of the Commissioner of Customs under section 110A of Customs Act, 1962 cannot be interfered with by any circular or instructions. In the impugned order, it has been admitted that the provisional release has been subject to the conditions stipulated in circular no. 35/2017-Cus dated 16^th August 2017 which traverse beyond the empowerment in section 110A of Customs Act, 1962. It is for the owner of the vehicle to be compliant with law upon provisional release. Furthermore, it is on record that the vehicle has already been registered with the competent authority under the Motor Vehicles Act, 1988. Provisions under the Foreign Trade Policy including licensing norms relevant to chapter 87 in ITC(HS) classification are intended to ensure that the import of any goods, post-clearance, would not be in breach of the essential requirements of law subject to which motor vehicles may be registered for operation on roads. The policy condition is not one incorporated merely for the sake of regulating imports and exports of the country but to ensure that the imported goods are compliant with the regulatory measures, other than that relating to imports and exports, under the municipal laws of the country. As the impugned vehicle has already been registered with the authorities concerned, it would appear that the vehicle complies with all the stipulations for operation and running on Indian roads. This, in effect, is the sum and substance of the ruling of the Hon’ble High Court of Kerala in re Ankineedu Manganti holding that

‘The appeal is filed against the order of the Customs, Excise and Service Tax Appellate Tribunal [2010 (262) ELT 484 (Tribunal)] holding that the confiscation of respondent’s vehicle for non production of type approval certificate is untenable. The learned standing counsel appearing for the appellant contended that Import policy requires production of type approval certificate in respect of every model of vehicle imported. However, we notice from the Tribunal’s order that the vehicle imported is produced by the world renowned vehicle manufacturer Toyota. It is the further finding that same types of vehicles are imported to India on earlier occasions. In our view type approval certificate is mainly required to ensure that the vehicle is safe and road worthy for public use and it is to be considered by the registering authority while registering the vehicle and not by the Customs authority when it is imported. Besides this, the assumption of the department that the importer has imported the vehicle which is unfit for use on road is also absurd. In fact, in a similar case, the Delhi High Court has upheld the view of the Tribunal because the importer cannot be expected to get what is not possible to obtain. We therefore do not find any merit in the appeal filed by the department. Consequently the appeal is dismissed.’

Accordingly, we hold that the inclusion of this condition as necessary for provisional release is redundant and superfluous and we allow this appeal by expunging the said condition as requirement of provisional release.

FULL TEXT OF THE CESTAT MUMBAI ORDER

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