2007 (2) TMI 567 - AT - Customs

Tribunal adjusts machinery value, reduces fines, upholds confiscation with penalty waiver

MADHU INDUSTRIES LTD. Versus COMMISSIONER OF CUSTOMS, AHMEDABAD

The Tribunal set aside the enhancement of value on the machinery and reduced the redemption fine and penalty, taking into account the total value of the ... Valuation - Penalty and redemption fine - Quantum of Issues involved: Confiscation of second-hand machinery for being over 10 years old, undervaluation of the machine, imposition of redemption fine and penalty, violation of Import Export Policy.Confiscation and Undervaluation: The Commissioner of Customs, Ahmedabad confiscated the second-hand machinery imported by the appellants for being over 10 years old and undervalued. The appellants were given the option to redeem the machinery on payment of a fine. The appellant's advocate argued that the redemption fine and penalty were excessive, citing previous Tribunal decisions to support his stance. The Tribunal agreed with the advocate, stating that the value enhancement was not justified as the value of old machinery varies and should be accepted based on the declared invoice price.Violation of Import Export Policy: The appellant admitted that the imported machine was over 10 years old and required a license under the Import Export Policy. The Tribunal upheld the confiscation of the machine but reduced the redemption fine and penalty, considering the total value of the machine to be around Rs. 28 lakhs. The redemption fine was reduced to Rs. 3.5 lakhs and the penalty to Rs. 3 lakhs, with the penalty imposed on the Managing Director being set aside.Conclusion: The Tribunal set aside the enhancement of value on the machinery and reduced the redemption fine and penalty, taking into account the total value of the machine. The confiscation was upheld, but the fines were adjusted accordingly, with the penalty on the Managing Director being waived.