Amended bill of entry defeats redemption fine, while proven misdeclaration can still justify a reduced customs penalty.

Where amendment of the bill of entry was allowed under Section 149 of the Customs Act, the basis for confiscation on the original declaration could not be sustained, so redemption fine under Section 125 was set aside. Misdeclaration in the bills of entry was nevertheless established, so penalty remained warranted; however, the quantum was found excessive on the facts and was reduced. The order was therefore modified by deleting the redemption fine and moderating the penalty, while leaving the finding of misdeclaration undisturbed to that extent.

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Issues: (i) Whether redemption fine was sustainable after amendment of the bill of entry was allowed; (ii) Whether the penalty imposed for misdeclaration was excessive and required reduction.

Issue (i): Whether redemption fine was sustainable after amendment of the bill of entry was allowed.

Analysis: The bill of entry had been permitted to be amended under Section 149 of the Customs Act, 1962. Once amendment was allowed, the basis for confiscation in relation to the declared value could not be sustained for the purpose of imposing redemption fine under Section 125 of the Customs Act, 1962.

Conclusion: Redemption fine was not justified and was set aside.

Issue (ii): Whether the penalty imposed for misdeclaration was excessive and required reduction.

Analysis: The record disclosed misdeclaration in the bills of entry, so penalty was warranted. However, the quantum imposed was found to be excessive in the facts and circumstances and required moderation.

Conclusion: Penalty was upheld in principle but reduced to Rs. 1 lakh.

Final Conclusion: The order was modified by deleting the redemption fine and by reducing the penalty, while leaving the finding of misdeclaration undisturbed to that extent.

Ratio Decidendi: Where amendment of the bill of entry is allowed, redemption fine based on the unamended declaration cannot be sustained, though misdeclaration may still attract a reduced penalty on the facts.

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