Case Law Details
Specta Decor Pvt Limited Vs Commissioner of Customs (CESTAT Bangalore)
Customs is legally bound by the notifications issued by the DGFT and therefore, the notification which is applicable on the date of import cannot be ignored
In the case of Specta Decor Pvt Limited vs. Commissioner of Customs, heard by the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Bangalore, the central issue revolved around the applicability of notifications issued by the Directorate General of Foreign Trade (DGFT). The tribunal’s ruling emphasized customs’ legal obligation to adhere to these notifications and discussed the imposition of redemption fines in light of the circumstances surrounding the import.
The appellant, Specta Decor Pvt Limited, filed a Bill of Entry for the clearance of hot-dipped galvanized steel coils. However, the DGFT had introduced a minimum import price (MIP) for iron and steel goods. The appellant’s imports fell below the stipulated MIP, leading to the Commissioner holding the goods liable for confiscation under Section 111(d) of the Customs Act 1962, read with Section 3(3) of the FTDR Act 1992. Consequently, a redemption fine of Rs. 15,00,000/- was imposed.
The appellant contended that they had initiated the import process before the issuance of the DGFT notification. They had placed orders with the supplier, made advance payments, and completed various formalities well in advance. Despite these efforts, the delay in vessel availability led to the consignment’s delayed arrival, falling under the scope of the notification. The appellant argued that mitigating circumstances, beyond their control, warranted leniency, especially considering their status as a 100% Export Oriented Unit (EOU).
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