Contravention of Drugs and Cosmetics rules justified confiscation, but excessive redemption fine and penalty were reduced.

Imported goods found to be brought in contravention of section 10(a) of the Drugs and Cosmetics Act, 1945 and the rules made thereunder were liable to confiscation under section 111(d) of the Customs Act, 1962, and confiscation was upheld. However, the redemption fine and penalty were treated as excessive because the importer was a 100% Export Oriented Unit, two consignments had already been released, substantial demurrage had accrued, there was no material showing deliberate irregularity, and re-export had been permitted. On that basis, the monetary liabilities were reduced.

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Issues: Whether the imported goods were liable to confiscation for violation of the Drugs and Cosmetics Act, 1945, and whether the redemption fine and penalty imposed under the Customs Act, 1962 required reduction.

Analysis: The goods were found to have been imported in contravention of Section 10(a) of the Drugs and Cosmetics Act, 1945 and the rules made thereunder, attracting confiscation under Section 111(d) of the Customs Act, 1962. The confiscation was therefore sustained. At the same time, the circumstances showed that the appellant was a 100% Export Oriented Unit, two consignments had already been released, substantial demurrage had been incurred, there was no material to show deliberate irregularity, and re-export had been permitted. In that background, the originally imposed redemption fine and penalty were found to be excessive.

Conclusion: Confiscation was upheld, but the redemption fine and penalty were reduced to Rs. 50,000 and Rs. 20,000 respectively.

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