Customs Tribunal Decision: Duty upheld, interest set aside. Penalties adjusted based on representation. Confiscation upheld, redemption fine set aside.

The Tribunal upheld the demand of duty in both the Mumbai and Chennai cases but set aside the demand for interest under Section 28AB of the Customs Act. Penalties were adjusted, with penalties on 'M/s Global Art' and Mr. Bimal Kumar Mehra being reduced or set aside based on entity representation. Confiscation of goods was upheld, but redemption fine was set aside due to non-availability of goods. The applicability of Sections 114A and 28AB was clarified, with penalties and interest under these sections being set aside for imports made before the relevant dates.

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Issues Involved:
1. Jurisdictional Objection
2. Demand of Duty and Interest
3. Imposition of Penalties
4. Confiscation and Redemption Fine
5. Applicability of Section 114A and Section 28AB of the Customs Act

Issue-wise Detailed Analysis:

1. Jurisdictional Objection:
The appellant raised a jurisdictional objection, arguing that the Commissioner of Customs (Adjudication), Mumbai should have jointly adjudicated both show-cause notices as per Notification No. 93/98-Cus (NT) dated 16.11.98. The Tribunal overruled this objection, noting that it was not raised at the earliest stage of proceedings and was not included in the appellant's replies to the show-cause notices or in the present appeals.

2. Demand of Duty and Interest:
The appellant contended that the duty was effectively paid when the bank guarantee was encashed in March 1997, implying no further duty, fine, or penalty should be levied. The Tribunal rejected this argument, stating that encashment of the bank guarantee was not voluntary payment of duty by the appellant. The Tribunal upheld the demand of duty in both the Mumbai and Chennai cases but set aside the demand for interest under Section 28AB of the Customs Act, as it was not in force at the time of import.

3. Imposition of Penalties:
The penalties imposed under Section 112 and Section 114A were contested. The Tribunal found that separate penalties on 'M/s Global Art' and Mr. Bimal Kumar Mehra in the Chennai case were not permissible as they represented the same entity. The penalty on 'M/s Global Art' under Section 112 in the Chennai case was reduced to Rs 1,00,000, and the penalty on Mr. Bimal Kumar Mehra was set aside. In the Mumbai case, the penalty under Section 114A was set aside, and the penalty on Mr. Bimal Kumar Mehra under Section 112 was reduced to Rs 10,000.

4. Confiscation and Redemption Fine:
The Tribunal upheld the confiscation of goods under Section 111(o) due to the breach of conditions of Notification No. 80/95-Cus. However, since the goods were not available for confiscation, the redemption fine imposed in the Chennai case was set aside. The Tribunal noted that the non-availability of goods would not prevent the imposition of redemption fine, supported by the Supreme Court's judgment in Weston Components Ltd vs Commissioner.

5. Applicability of Section 114A and Section 28AB of the Customs Act:
The Tribunal agreed with the appellant that Section 114A and Section 28AB, which came into force on 28.09.1996, were not applicable to imports made before this date. Consequently, the penalties under Section 114A and the interest under Section 28AB were set aside.

Conclusion:
The appeals were disposed of with the following orders:
- Mumbai Case (Appeal No C/1279/01):
- Demand of duty upheld.
- Goods held liable to confiscation.
- Penalty under Section 114A set aside.
- Penalty under Section 112 reduced to Rs 10,000.

- Chennai Case (Appeal No. C/84/03):
- Demand of duty with interest upheld.
- Goods held liable to confiscation, but redemption fine set aside.
- Penalty under Section 112 reduced to Rs 1,00,000.
- Penalty on Mr. Bimal Kumar Mehra under Section 112 set aside.

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