Captive-use lead acid batteries were outside importer registration rules, so confiscation, fine and penalty could not stand.

Imported lead acid batteries used for captive consumption in UPS systems were held not to attract the one-time registration requirement under the Batteries (Management and Handling) Rules, 2001 because the definition of "importer" covered persons bringing in new batteries for sale. Since the goods were not imported for sale and were available in the warehouse for internal use, the customs clearance condition in the Rules was not triggered. Confiscation, redemption fine and penalty were therefore unsustainable, and the appellant succeeded.

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Issues: Whether imported lead acid batteries meant for captive consumption, and not for sale, were required to obtain one-time registration with the Ministry of Environment and Forests under the Batteries (Management and Handling) Rules, 2001, so as to justify confiscation, redemption fine and penalty.

Analysis: The Batteries (Management and Handling) Rules, 2001 were framed under the Environment (Protection) Act, 1986. Rule 3(k) defines an importer as a person who imports new lead acid batteries or components containing lead for the purpose of sale. Rule 5 requires registration of importers, and Rule 6 makes customs clearance of imports of new lead acid batteries contingent upon such registration. On the facts found, the batteries were imported for captive consumption in UPS systems and had been received and were available in the warehouse. As the imports were not for sale, the appellant did not fall within the relevant definition of importer for the registration requirement.

Conclusion: The confiscation and consequential redemption fine and penalty were unsustainable. The appeal was allowed in favour of the appellant.

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