Bombay High Court Dismisses Customs Appeal in Second-Hand Vehicle Import Case. Court Upholds CESTAT's Ruling, Finds No Legal Violation in Import of Toyota Van.


Summary of Judgement

The Bombay High Court, in this case, addressed an appeal by the Commissioner of Customs regarding the import of a second-hand motor vehicle. The vehicle, a "Toyota Hiace Commuter Van," was seized on suspicion that it violated policy conditions under the Customs Tariff Act, 1975. The Customs Excise and Service Tax Appellate Tribunal (CESTAT) had earlier allowed the provisional release of the vehicle and ruled in favor of the importer. The High Court upheld the CESTAT’s decision, emphasizing that the necessary policy conditions, which ensure compliance with Indian road regulations, had been met as the vehicle was already registered under the Motor Vehicles Act, 1988. Consequently, the appeal was dismissed as no substantial questions of law were found.

1. Introduction

This judgment from the Bombay High Court revolves around an appeal filed by the Commissioner of Customs against the decision of CESTAT concerning the import of a second-hand "Toyota Hiace Commuter Van." The dispute centered on whether the import violated conditions under the Customs Tariff Act, 1975.

2. Background of the Case

The respondent, Modern Trading & Logistics LLP, filed a bill of entry for the clearance of the vehicle in January 2019. The vehicle was seized by customs authorities on the grounds that it was not new as declared but a second-hand vehicle, which would render the import in violation of policy conditions.

3. Tribunal's Decision

The respondent requested provisional release of the vehicle after paying duty and providing required guarantees. The CESTAT allowed the appeal in December 2022, stating that the specific policy condition under Chapter 87 of the Customs Tariff Act was redundant and unnecessary. The tribunal relied on a similar decision by the Kerala High Court.

4. Key Legal Questions

The appellant raised two main legal questions: whether the testing requirement under Chapter 87 was redundant and whether the reliance on the Kerala High Court's decision was valid.

5. Court's Analysis and Decision

The High Court agreed with the CESTAT, noting that the vehicle had already been registered under the Motor Vehicles Act, 1988, which ensured its compliance with Indian road standards. The court held that the conditions mentioned were not merely for regulating imports but also for ensuring road safety.

6. Conclusion

The court found that no substantial question of law arose in this appeal and dismissed the case, reaffirming the CESTAT’s ruling and upholding the previous judgments.

The Judgement

Case Title: Commissioner of Customs Versus Modern Trading & Logistics LLP

Citation: 2024 LawText (BOM) (8) 142

Case Number: CUSTOMS APPEAL NO.18 OF 2023 WITH INTERIM APPLICATION (L) NO.14158 OF 2023 IN CUSTOMS APPEAL NO.18 OF 2023

Date of Decision: 2024-08-14