Appeals allowed, redemption fine and penalty set aside due to lack of show cause notice and unspecified role. The appeals were allowed, setting aside the redemption fine on the seized goods and the penalty on the co-appellant. The Tribunal found that without a ...
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Appeals allowed, redemption fine and penalty set aside due to lack of show cause notice and unspecified role.
The appeals were allowed, setting aside the redemption fine on the seized goods and the penalty on the co-appellant. The Tribunal found that without a show cause notice for extending seizure, the goods should have been released unconditionally. As the goods were not available without any conditions, no redemption fine could be imposed. Additionally, since the co-appellant's role was not specified and no statement was recorded, the penalty imposed on them was set aside.
Issues: Imposition of redemption fine on the appellant company and penalty on the co-appellant.
Analysis: The case involved an appeal against an order imposing redemption fine on the appellant company and penalty on the co-appellant. The facts revealed excess stock of finished goods during a search at the factory. The daily stock account showed discrepancies, leading to allegations of failure to record production in the register. Seized goods were alleged to be liable for confiscation, and penalties were imposed. The main appellant's penalty was set aside on appeal, leading to the current appeal.
The appellant argued that no show cause notice under Section 110(2) of the Customs Act was issued for extending seizure, thus goods should be released unconditionally. Citing a Tribunal decision, the appellant claimed no redemption fine could be imposed as goods were not available without any bond. Additionally, as no statement of the co-appellant was recorded, it was argued that no penalty could be imposed without clarifying the role.
The respondent opposed, referring to a Supreme Court decision to support the initiation of confiscation proceedings and penalties under different sections of the Customs Act. However, the Tribunal found merit in the appellant's arguments. It noted that without a show cause notice for extending seizure, the goods should have been released unconditionally. Consequently, while the goods were liable for confiscation, no redemption fine could be imposed due to their unavailability without any conditions. Similarly, as the co-appellant's role was not specified, the penalty imposed on them was set aside.
In conclusion, the appeals were allowed, setting aside the redemption fine on the seized goods and the penalty on the co-appellant.
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