Export notification compliance and unfair laboratory reliance meant confiscation and penalty could not be sustained on these facts.

Export consignments were held to satisfy the DGFT notification requirements under the relevant export notifications, and the adverse laboratory report was not treated as conclusive because retesting before another laboratory had been sought and refused without plausible reasons. The Tribunal followed its earlier decision on the same issue and held that, on these facts, confiscation and penalty could not be sustained. The impugned order was set aside and consequential relief was granted.

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Issues: Whether the export consignments satisfied the DGFT notification parameters and whether confiscation and penalty could be sustained on the basis of the laboratory report when retesting was sought.

Analysis: The parameters prescribed under Notification No. 55 (RE-2008)/2004-2009 dated 05.11.2008, read with Notification No. 57/2009-2014 dated 17.08.2010, were found to have been met. The adverse laboratory report, relied upon with reference to the Basmati Rice (Export) Grading and Marketing Rules, 1979, was not accepted as conclusive, particularly because the request for retesting before another laboratory had been rejected without plausible reasons. The prior decision of the Tribunal on the same issue was followed.

Conclusion: Confiscation of the exported goods and the penalty were unsustainable, and the appeal succeeded.

Final Conclusion: The impugned order was set aside and the appellants were granted consequential relief in law.

Ratio Decidendi: Where the applicable export notification requirements are met and a negative laboratory report is not fairly validated after a refused retest request, confiscation and penalty cannot be sustained.

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