Mandatory import documentation breach can justify confiscation and penalty, though redemption fine may be reduced on proportionality grounds.

Mandatory documentary conditions under the Foreign Trade Policy, including a pre-shipment inspection certificate from the specified agency, were treated as enforceable import requirements. Non-furnishing of the prescribed certificate constituted a breach justifying confiscation under the Customs Act and penalty, even though the goods themselves contained no incriminating material. However, the redemption fine and penalty were examined on proportionality grounds and found excessive in relation to the lapse, so the monetary burden was reduced while the finding of contravention and confiscation was maintained.

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Issues: (i) whether import of heavy melting scrap without furnishing the pre-shipment certificate from the specified agency, as required by the Foreign Trade Policy, justified confiscation under the Customs Act and imposition of penalty; (ii) whether the redemption fine and penalty required reduction as being disproportionate to the violation.

Issue (i): whether import of heavy melting scrap without furnishing the pre-shipment certificate from the specified agency, as required by the Foreign Trade Policy, justified confiscation under the Customs Act and imposition of penalty

Analysis: The imported goods were required to comply with the prescribed documentary conditions under the amended Foreign Trade Policy, including a pre-shipment inspection certificate issued by the specified agency. The absence of the stipulated certificate was treated as a breach of the mandatory procedure. The fact that the consignment was found to contain no incriminating material did not cure the non-compliance, since the policy requirement had to be followed in the manner prescribed.

Conclusion: Confiscation and liability to penalty were upheld.

Issue (ii): whether the redemption fine and penalty required reduction as being disproportionate to the violation

Analysis: While sustaining the finding of breach, the quantum of redemption fine and penalty was examined on the basis of proportionality. The original imposition was found excessive in relation to the nature of the lapse, and moderation was considered appropriate to meet the ends of justice.

Conclusion: The redemption fine and penalty were reduced.

Final Conclusion: The appeals succeeded only to the limited extent of reduction in the monetary burden, while the finding of contravention and the consequential confiscatory action were maintained.

Ratio Decidendi: Where the import policy prescribes a mandatory documentary requirement, non-compliance can justify confiscation and penalty even if the goods themselves are not incriminating, though the quantum of fine and penalty may be moderated on proportionality grounds.

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