Case Note & Summary
The Commissioner of Customs, Goa, filed an appeal under the Customs Act, 1962, against an order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai, which had set aside the absolute confiscation of cosmetic goods imported by M/s. Max Overseas. The respondent had imported cosmetics such as shower gel, roll-on, shampoo, shaving gel, hair cream, body cream, and scented spray, valued at ₹7,54,095, through Marmagoa Port. The Commissioner had ordered confiscation on the ground that the import violated Rule 133 read with Rule 43-A of the Drugs and Cosmetics Rules, 1945, which restrict the import of cosmetics to specified points of entry, and Marmagoa was not a notified port. The Tribunal allowed the appeal, holding that the goods were exempt under Rule 132 of the Rules read with Schedule D, as they were not intended for medicinal use. The High Court framed a substantial question of law: whether cosmetics as defined under Section 3(aaa) of the Drugs and Cosmetics Act, 1940 could be exempt from the restriction under Rule 133 read with Rule 43-A. The court analyzed the provisions and found that the exemption under Rule 132 applies only to substances specified in Schedule D, which does not include cosmetics. The court held that the Tribunal erred in applying the exemption, as cosmetics are not covered by Schedule D. Consequently, the import through a non-notified port was improper and the goods were liable to confiscation. The High Court allowed the appeal, set aside the Tribunal's order, and restored the Commissioner's order of absolute confiscation.
Headnote
A) Customs Law - Confiscation of Improperly Imported Goods - Rule 133 read with Rule 43-A of Drugs and Cosmetics Rules, 1945 - Import of Cosmetics Through Non-Notified Port - The appellant Commissioner of Customs challenged the Tribunal's order setting aside confiscation of cosmetics imported through Marmagoa Port, which was not a notified point of entry under Rule 43-A. The High Court held that cosmetics are not exempted under Rule 132 and Schedule D, and the import through a non-notified port violated the prohibition, warranting confiscation. (Paras 1-4) B) Drugs and Cosmetics Law - Exemption Under Rule 132 - Schedule D Entry No.1 - The Tribunal had held that the imported cosmetics were exempt under Rule 132 read with Schedule D, but the High Court found that the exemption applies only to substances not intended for medicinal use and that cosmetics are not covered by Schedule D. The court set aside the Tribunal's order and restored the Commissioner's order of absolute confiscation. (Paras 3-4)
Issue of Consideration
Whether cosmetics as defined under Section 3(aaa) of the Drugs and Cosmetics Act, 1940 are exempt from the restriction contained in Rule 133 read with Rule 43-A of the Drugs and Cosmetics Rules, 1945, and whether the Tribunal erred in holding that the imported cosmetics were entitled to exemption under Rule 132 and Schedule D.
Final Decision
The High Court allowed the appeal, set aside the order of the Tribunal, and restored the order of the Commissioner of Customs dated 18.11.2009 ordering absolute confiscation of the imported cosmetics.
Law Points
- Interpretation of exemption under Rule 132 of Drugs and Cosmetics Rules
- 1945
- Scope of Rule 133 read with Rule 43-A
- Definition of cosmetics under Section 3(aaa) of Drugs and Cosmetics Act
- 1940
- Confiscation under Customs Act
- 1962 for improper import
