Licensable drug import without required licence and proxy importer claims justified confiscation and penalties

Imported tranexamic acid was treated as a licensable drug under the Drugs and Cosmetics regime, so import without the required Form 10 licence rendered the goods liable to confiscation. The Tribunal also treated the attempt to project a different entity as importer, despite bank trail and surrounding conduct showing the appellant concern as the real importer, as a fraudulent proxy arrangement that did not avoid Customs scrutiny. On that basis, absolute confiscation was upheld. The Tribunal further sustained redemption fine and penalties against the connected persons, holding that their knowing participation in the unlawful import justified penal consequences notwithstanding later claims of leniency or formal documentation.

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Issues: (i) whether the imported tranexamic acid was liable to confiscation and absolute confiscation for want of the required drug import licence and for the fraudulent attempt to alter the importer's identity; (ii) whether redemption fine and penalties imposed on the connected persons were sustainable.

Issue (i): whether the imported tranexamic acid was liable to confiscation and absolute confiscation for want of the required drug import licence and for the fraudulent attempt to alter the importer's identity.

Analysis: The imported goods were found to be a drug on testing, and import of such goods required a Form 10 licence under the Drugs and Cosmetics regime. The record showed that the appellant concern was the real importer, the payments were routed through its bank accounts, and the later attempt by another entity to claim importer status was treated as a proxy arrangement. The conduct disclosed a coordinated effort to evade scrutiny, supported by false declarations and misdescription. In such circumstances, the goods were treated as liable to confiscation as prohibited goods and the fraudulent device did not confer any legal protection.

Conclusion: The goods were liable to confiscation and absolute confiscation was upheld.

Issue (ii): whether redemption fine and penalties imposed on the connected persons were sustainable.

Analysis: The Tribunal found that both appellants were knowingly connected with the unlawful import, that the real importer and the proprietor were effectively behind the transaction, and that the attempt to evade the licensing requirement and Customs scrutiny justified penal consequences. The plea for leniency was rejected because the import was held to be part of a fraudulent scheme and the liability was not confined to the formal description of the documents.

Conclusion: The redemption fine and penalties were sustained against the appellants.

Final Conclusion: The import was treated as a fraudulent, licensable drug import undertaken without the requisite permission, warranting confiscation and penal consequences; both appeals therefore failed.

Ratio Decidendi: Where imported goods are found to be drug goods requiring a licence and the surrounding conduct shows a fraudulent attempt to conceal the true importer and evade Customs scrutiny, the goods are liable to confiscation and connected persons may be penalised notwithstanding later proxy claims or re-export arrangements.

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