2008 (5) TMI 48 - AT - Customs

Tribunal reduces fine, orders release of car with valid certificate

The tribunal granted relief to the appellant, emphasizing the validity of the type approval certificate from Belgium and reducing the redemption fine and ... Type approval certificate from international accredited agency - Recognition of Service Public Federal, Belgium under DGFT policy - Country of origin requirement for type approval - Licensing Note (2)(I) and (2)(II) of Chapter 87 - Judicial reduction of redemption fine and penalty in exercise of discretionType approval certificate from international accredited agency - Country of origin requirement for type approval - Recognition of Service Public Federal, Belgium under DGFT policy - Licensing Note (2)(I) and (2)(II) of Chapter 87 - Acceptability of the type approval certificate issued by Service Public Federal, Belgium for a New Lexus LS 600 HL (RHD) car manufactured in Japan but imported from the UK. - HELD THAT: - The Tribunal found it undisputed that the vehicle satisfied the conditions of Licensing Note (2)(I) and (2)(II) of Chapter 87 of the ITC (HS) and that the car was new and manufactured in Japan but imported from a UK dealer who was a dealer of the Japanese manufacturer. The type approval certificate produced was issued by Service Public Federal, Belgium, an international accredited agency listed in DGFT Policy Circular No. 26 dated 9-2-2004. The Tribunal held there was no dispute as to the authenticity or the substantive verification underlying the certificate, and that rejecting it solely because it was not issued from the country of origin was erroneous. It noted that the Belgian certificate results from verification against European Union standards and therefore sufficed for customs clearance. [Paras 7, 8, 9]Type approval certificate issued by Service Public Federal, Belgium held acceptable and compliant with licensing requirements; rejection on grounds of not being from the country of origin was erroneous.Judicial reduction of redemption fine and penalty in exercise of discretion - Appropriateness of the redemption fine and penalty imposed and the relief to be granted. - HELD THAT: - Having accepted the certificate and noted compliance with licensing conditions, the Tribunal considered the confiscation, redemption fine and penalty excessive and directed leniency. Exercising its discretion, the Tribunal reduced the redemption fine and penalty to specified amounts and ordered release of the car on payment and production of evidence within three days, modifying the adjudicating authority's order accordingly. [Paras 10, 11]Redemption fine and penalty reduced; impugned order modified and car to be released on payment of the directed amounts and production of evidence within three days.Final Conclusion: The type approval certificate from Service Public Federal, Belgium was held acceptable despite the vehicle's manufacture in Japan; the confiscation order was modified by reducing the redemption fine and penalty and directing release of the car on payment and production of evidence. Issues involved:1. Confiscation of imported car under Customs Act, 1962.2. Acceptance of type approval certificate from a different country.3. Imposition of redemption fine and penalty.Analysis:1. The stay application was against an order confiscating a car imported under the Customs Act, 1962. The adjudicating authority confiscated the car under Section 111(d) with an option for redemption on payment of a fine and imposed a penalty. The issue was deemed narrow for final disposal after granting a waiver of pre-deposit.2. The appellant imported a new car from the UK, which was found to lack a type approval certificate from the country of origin, Japan. The appellant presented a certificate from Belgium, which the authority rejected. The appellant argued that the certificate from Belgium should suffice, citing a similar case judgment. The respondent contended that the certificate did not meet legal requirements due to the car's origin and licensing violations.3. The car met licensing requirements and was new, imported from a UK dealer connected to the Japanese manufacturer. The key issue was the acceptance of the type approval certificate from Belgium. The tribunal noted that the certificate from an international agency in Belgium, listed in the DGFT Policy circular, was valid despite not being from the country of origin. The certificate was issued after rigorous EU standards verification.4. Considering all facts, the tribunal found the redemption fine and penalty excessive. It reduced the redemption fine to Rs. 1.00 lakh and the penalty to Rs. 40,000, emphasizing leniency and justice. The impugned order was modified accordingly, directing the release of the car upon payment within three days, concluding the appeal proceedings.Judgment:The tribunal granted relief to the appellant, emphasizing the validity of the type approval certificate from Belgium and reducing the redemption fine and penalty to ensure fairness and justice in the case of the confiscated imported car.