Import of regulated goods without licence supports confiscation of the offending consignment, while bona fide belief may reduce penalties.

Import of regulated gas cylinders without the requisite licence rendered the consignment of 238 cylinders liable to confiscation because the licence condition applied where the quantity in possession was not less than 200. The violation was confined to that offending consignment and could not be extended to both consignments merely because the goods were imported in two lots. Bona fide belief that a licence was not required, past import activity, and the surrounding circumstances justified a liberal approach to quantum, so the redemption fine and penalties were substantially reduced while liability as importer was maintained.

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Issues: (i) Whether import of the gas cylinders without the requisite licence rendered the goods liable to confiscation, and whether the violation could extend to both consignments; (ii) whether the redemption fine and penalties imposed were liable to be reduced.

Issue (i): Whether import of the gas cylinders without the requisite licence rendered the goods liable to confiscation, and whether the violation could extend to both consignments.

Analysis: The licence requirement was held applicable where the quantity of cylinders in possession was not less than 200, and one consignment contained 238 cylinders. On that basis, clearance of that consignment would have contravened the regulatory condition. The fact that there were two consignments did not justify treating both as offending, because only one consignment crossed the threshold. The plea that earlier imports had been allowed did not displace the present violation, although it was considered relevant to the appellants' bona fide belief.

Conclusion: The goods in the consignment of 238 cylinders were liable to confiscation, but the violation was confined to that consignment and not to both consignments.

Issue (ii): Whether the redemption fine and penalties imposed were liable to be reduced.

Analysis: The appellants' bona fide belief that licence was not required, their past import activity, and the circumstances of the case warranted a liberal view on quantum. At the same time, the appellants could not disown their liability as importers after having claimed ownership of the goods. The adjudication was therefore sustained on principle, but the monetary consequences were moderated.

Conclusion: The redemption fine and penalties were reduced: the redemption fine was reduced to Rs. 1 lakh, the penalty on the proprietor to Rs. 75,000, and the penalty on the manager to Rs. 50,000.

Final Conclusion: The order of confiscation was upheld to the extent of the offending consignment, while the monetary liabilities were substantially reduced, leaving the appeals otherwise rejected.

Ratio Decidendi: Where import of regulated goods is made without the required licence, confiscation is sustainable for the offending consignment, but a bona fide belief and surrounding circumstances may justify reduction of redemption fine and penalty without negating the importer's liability.

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