IMPORTANT POINT
The court established that for goods to be classified as hazardous waste, they must meet specific definitions under the law, which the imported machines did not.

JUDGMENT :

K.R. SHRIRAM, J.

1. Petitioner is impugning an order dated 21st April 2021 passed by respondent no. 3.

2. Petitioner is engaged in import, manufacture and supply of medical equipments. In the course of business, petitioner also imports used haemodialysis machines into India since 2008.

3. On or about 28th January 2021, petitioner imported “used haemodialysis machines” (“said Goods”) vide Bill of Entry No. 2537281 for supply to the dialysis centre at the hospital of respondent no. 5, i.e. Delhi Sikh Gurudwara Management Committee, New Delhi. The Bill of Entry contained an examination order which states, inter alia, that the Customs Department shall get concerned goods certified by a Chartered Engineer that the imported goods were not hazardous waste or e-waste. Petitioner had also imported another consignment of identical haemodialysis machine vide Bill of Entry No. 2536133 dated 28th January 2021. These have been cleared by the Custom Authorities and installed at the hospital of respondent no. 5. Both consignments were examined by the empanelled Chartered Engineers at the Customs, who certified that “used haemodialysis machines” were not hazardous waste or e-waste. Petitioner paid duty of Rs.6,03,736/- on or about 10th February 2021.

4. By communication dated 15th February 2021, respondent no. 3 raised an objection vide a query disallowing clearance of the said goods alleging violation of Hazardous and other Wastes (Management, Handling and Trans-Boundary Movement) Rules, 2016 (“the said Rules”). By its letter dated 22nd February 2021, petitioner replied and explained that the said Rules did not prohibit the clearance of the said goods. This was followed by virtual hearing granted on 5th March 2021 by Deputy Commissioner of Customs. On or about 8th March 2021, petitioner submitted a detailed representation to the Commissioner, Additional Commissioner of Customs and the Deputy Commissioner of Customs reiterating that “used haemodialysis machines” did not contain any hazardous or other waste as defined under the said Rules. Petitioner requested that the said goods be allowed to be cleared. Petitioner submitted various certificates in support of its case.

5. It is petitioner’s case that notwithstanding the detailed representation given by petitioner as recorded above, respondent no. 3 issued a show cause notice (SCN) dated 19th March 2021 under Section 124 of Customs Act, 1962 (“the Act”). In the show cause notice, the stand taken by respondent no. 3 was that the import of “Used Critical Care Medical Equipment” has been prohibited under the policy condition and the provisions laid down for the import of “Old and Used Medical Equipment” under Rule 12(6) and ‘Basel No. B-1110’ of Schedule VI of the said Rules. According to respondent no. 3, petitioner has therefore, violated the policy condition laid down under Schedule VI of the said Rules by importing the “used medical equipment.” Petitioner was therefore, called upon to show cause as to why the said goods having declared assessable value of Rs.50,14,653/- and applicable duty of Rs.6,01,758/- should not be confiscated under Section 111 (d) of the Customs Act, 1962 (“the Act”) and penalty under Section 112(a)(i) of the Act should not be imposed. Paras (4) to (6) of the SCN read as under:

“(4) The import of “Used Critical Care Medical Equipment” has been prohibited under the policy condition and provisions laid down for the import of “Old and Used Medical Equipment” under Rule 12(6) and 'Basel No. B-1110' of Schedule-VI of Hazardous and other Wastes (Management, Handling and Trans- Boundary Movement) Rules, 2016 (F. No. 23-4/2009-HSMD), MINISTRY OF ENVIRONMENT, FOREST AND CLIMATE CHANGE.

(5) Therefore, in view of the facts as stated above, the importer has violated the policy condition laid down under Schedule-VI of Hazardous and other Wastes (Management, Handling and Trans-Boundary Movement) Rules, 2016 by importing goods namely “Used Medical Equipment” which 'Prohibited' under