Import of old and used spares without required certification led to confiscation, with redemption fine and penalty reduced.

Old and used imported spares and parts were treated as contrary to the Foreign Trade Policy because no Chartered Engineer's certificate showing the required residual life was produced, and some goods were also undeclared. On that basis, confiscation and penalty on the importer were upheld in principle. The monetary consequences were, however, found excessive on the facts, so the redemption fine and penalty were reduced. The operative effect was that contravention and confiscability were maintained, while the quantum of fiscal liability was modified downward.

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Issues: (i) Whether the import of old and used spares and parts was in contravention of the Foreign Trade Policy and liable to confiscation and penalty. (ii) Whether the redemption fine and penalty required modification.

Issue (i): Whether the import of old and used spares and parts was in contravention of the Foreign Trade Policy and liable to confiscation and penalty.

Analysis: The goods imported were old and used spares and parts, and no Chartered Engineer's certificate showing the requisite residual life was produced. The record also showed non-declaration of some goods, including oil and containers. In these circumstances, the import was treated as contrary to the Foreign Trade Policy and the goods were held liable to confiscation, with consequential penalty on the importer.

Conclusion: The issue is decided against the assessee. The confiscation and imposition of penalty were upheld in principle.

Issue (ii): Whether the redemption fine and penalty required modification.

Analysis: While sustaining the findings on contravention and liability, the Court considered the facts and found that the monetary consequences deserved reduction.

Conclusion: The redemption fine and penalty were reduced.

Final Conclusion: The appeal succeeded only to the extent of reduction of the monetary liabilities, while the finding of contravention and confiscability was maintained.

Ratio Decidendi: Old and used imported goods, when restricted under the Foreign Trade Policy and unsupported by the required certification, along with undeclared goods, are liable to confiscation and penalty, though the quantum of redemption fine and penalty may be reduced on the facts of the case.

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