Second hand photocopiers as capital goods: confiscation, redemption fine and penalty were set aside under customs law.

Second hand photocopier machines were treated as capital goods under the Foreign Trade Policy, 2004-09, and were not liable to confiscation under Section 111(d) of the Customs Act, 1962. Relying on an earlier identical decision and the Supreme Court's ruling in Atul Commodities, the Tribunal held that the amended Para 2.17 introduced by Notification No. 31 (RE-2005)/2004-2009 did not alter the position for the imports in question, having regard to the transitional provision in Para 1.5 of the Policy. The confiscation was therefore unlawful, and the redemption fine and penalty under Section 112 were set aside.

---

---

Issues: Whether the confiscation of second hand photocopier machines under Section 111(d) of the Customs Act, 1962 and the consequential redemption fine and penalty under Section 112 of the Customs Act, 1962 were sustainable in law.

Analysis: The imported goods were second hand photocopiers and the dispute turned on their treatment under the Foreign Trade Policy, 2004-09. The Tribunal noted that an earlier decision on identical facts, read with the Supreme Court's ruling in Atul Commodities, had already held that second hand photocopiers fall within capital goods and are not liable to confiscation under Section 111(d) of the Customs Act, 1962. The plea that the amended Para 2.17 introduced by Notification No. 31 (RE-2005)/2004-2009 dated 19.10.2005 affected the imports was also considered in the light of the transitional provision in Para 1.5 of the Policy.

Conclusion: The confiscation was held to be unlawful and the redemption fine and penalty were set aside.

---