Customs Appeal No. 30 of 2005. Case: Commissioner of Customs (Airport) Vs Globe Entertainments. High Court of Bombay (India)
| Case Number | Customs Appeal No. 30 of 2005 |
| Counsel | For Appellant: Shri Advait Sethna with Ms. Raju Thakkar and Ms. Suchitra Kamble, Advs. and For Respondent: Shri Vipin Jain with Krishan Kumar, P.K. Shetty and Yahya Ghoghari i/b. M/s. Sonal Doshi & Co. |
| Judges | S.C. Dharmadhikari and N.W. Sambre, JJ. |
| Issue | Customs Act, 1962 - Sections 113, 114, 14, 108; Income-tax Act, 1961 - Section 80HHC |
| Citation | 2016 (332) ELT 38 (Bom) |
| Judgement Date | February 06, 2015 |
| Court | High Court of Bombay (India) |
Order:
-
This appeal is by the Revenue questioning the legality and validity of the order passed by the Tribunal whereby the appeal preferred by the respondent No. 1 assessee came to be allowed.
-
While admitting the present appeal, this Court has framed the following questions of law:-
"(1) Whether the CESTAT erred in setting aside the Order-in-Original dated 9-7-2003, which directed confiscation of 8 seized pre-recorded cassettes as also the cassettes already exported, under Shipping Bills dated 27-1-1999 and 16-2-1999, on the ground of misdeclaration, resulting in contravention of the provisions of Section 113(d) and (i) of the Customs Act?
(2) Whether the CESTAT erred in disregarding the contraventions of relevant statutory provisions of the Customs Act, namely, Sections 2(33), 11 and 50(2) as also Section 18(1)(a) and Section 67 of the FERA read with the relevant notifications thereunder, all of which justify the confiscation of the said cassettes under Section 113(d) and (i) as held in the Order-in-Original?
(3) Whether the CESTAT erred in disregarding the contraventions of the Income-tax Act, i.e., Section 80HHC inter alia, duly considered in the order-in-original leading to the confiscation of the said video cassettes for violation of the Customs Act provisions as well as other applicable statutes collateral to Customs Act?
(4) Whether the CESTAT was justified in allowing the consequential relief to the respondents herein, in terms of setting aside the penalty imposed under Section 114 despite illegal exportation of goods, which were held liable to absolute confiscation under Section 113(d) and (i) vide Order-in-Original dated 9-7-2003?"
-
The few facts regarding the contentions raised before this Court can be summarized as under:
The present respondent No. 1 claimed to have entered into an agreement on May 18, 1998, transferring the overseas rights in relation to a television serial "Dekh Bhai Dekh" for its 55 episodes in eight number of VHS cassettes and has exported the same to Set-Satellite Pvt. Ltd., Singapore for consideration of Rs. 1.32 crores. The rights were transferred for a period of two years.
-
On 18th January, 1999, respondent No. 1 entered into another agreement with M/s. ABCL, who were producers of the said serial for acquiring the telecast rights of the same on Sony T.V. for a consideration of Rs. 50 lacs. It is not in dispute that the earlier contract of transferring overseas rights to M/s. Set-Satellite executed on 18th May, 1998, another contract was entered into in relation to the same, as stated hereinabove, in view of the agreement of export.
-
The video cassettes of Hindi serial were exported vide shipping bills dated 27th January, 1999 and 16th February, 1999 having declared value of Rs. 44,40,675/- and Rs. 28,29,950/- respectively.
-
In view of the export agreement, third shipping bill was filed for export of recorded video cassettes on 4th March, 1999 having declared value of Rs. 1,10,71,852/-.
-
The Revenue, having received an information that the cassettes in the said shipping bill were overvalued, as such stalled the processing of the shipping bills and initiated inquiry.
-
It is an admitted fact on record that the above referred transaction/goods are not chargeable, by the Revenue. The goods were exported on two occasions vide Shipping Bills dated 27th January, 1999 and 16th February, 1999. The nature of the goods which were shifted where the VHS Video Cassettes which were recorded on 4th March, 1999 at the facility of the respondent No. 2. The respondent No. 2 who was third party exporter in the present case has processed the same at their unit. The shipping bill filed by the respondent No. 2 in relation to the cassettes declared the value of the same at Rs. 1,10,71,852/-. The consignee shown to be the Set-Satellite.
-
Having regard to the above referred development, the Revenue has started an inquiry in the matter and has proceeded to record the statement of Hirachand Damaji Dand, proprietor of M/s. Globe Entertainments, Mr. Aziz Dohodwala, General Manager of M/s. Orson Video, who was assisted by Mr. Namdeo Bhuvad under Section 108 of the Act. In the said statement, which was recorded under Section 108 of the Customs Act, 1962, it is claimed by the Revenue that the Director of the respondent No. 1 company has admitted that the transfer was overvalued and same was done with an intention to derive the benefit under Section 80HHC of the Income-tax Act.
-
Based on the above referred factual matrix, the Revenue has issued a show cause notice to the respondent herein under Section 124 of the Customs Act calling upon the respondent No. 1 as to why the 8 VHS pre-recorded video cassettes under the seizure having been declared value of Rs. 1,10,71,850/- shall not be confiscated under Section 113(d) and (i) of the said Act. The respondent No. 1 was also called upon as to why 6 VHS pre-recorded video cassettes exported under the Shipping Bill dated 27th January, 1999 and 12 video cassettes exported under Shipping Bill dated 16th February, 1999 total valued at Rs. 74,30,625/- shall not be held liable for confiscation under Section 113(d) and (i) of the Customs Act, 1962. It was also informed to the respondent No. 1 as to why penalty be not imposed under Section 114(i) of the Customs Act.
-
The Commissioner of Customs while passing the Order-in-Original on 14th July, 2003 has reached to a conclusion that the confiscation of the 8 VHS pre-recorded video cassettes under seizure having declared value of Rs. 1,10,71,850/- under Section 113(d) and (i) of the Customs Act, 1962 to be absolute. It was further ordered that the said video cassettes were being exported only to show physical exports as discussed earlier, they are of no use to the exporter and same be destroyed. It is also ordered by the Commissioner of Customs that 6 VHS pre-recorded video cassettes exported under Shipping Bill dated 27th January, 1999 and 12 video cassettes exported...
To continue reading
Request your trial