2018 (8) TMI 427 - AT - Customs

Tribunal cancels redemption fine for import violation, citing retrospective effect, impacting penalty imposition.

The Tribunal set aside the redemption fine imposed on imported goods due to import restriction contravention, citing a clarificatory circular with ... Penalty u/s 112 of CA - restriction imposed by N/N. 64(RE-08)/04/09 dated 24/11/2008 on the imported consignment of S S Seamless Tube imported by the appellant-importer - Held that:- The issue is of import of the S S Seamless Tubes during the intervening period when the import restriction was imposed on their import which was subsequently lifted by issue of another Notification - also the Bills of Entry has been filed in this case for warehousing only Ex-bond Bill of Entry for clearance of imported goods were affected only when the restriction imposed was withdrawn by the issue of another circular. Hon’ble Apex Court in the case of Collector of Central Excise, Shilliong vs. Wood Craft Products Ltd. [1995 (3) TMI 93 - SUPREME COURT OF INDIA], wherein it is held that the amendments which are treated as clarificatory has to be taken that it was also there all the time - Going by the case of Wood Craft Products, there is no hesitation in holding that the impugned order of Commissioner imposing redemption fine on the goods imported by the appellant is contrary to the provisions Customs law read with DGFT circular of, and therefore, the same is set aside. Appeal dismissed - decided against revenue. Issues:- Application of restriction imposed by Notification No. 64(RE-08)/04/09 on imported consignment of S S Seamless Tube- Imposition of penalty under Section 112 of Customs Act on importer and CHA- Confiscation of goods under Section 111(d) of Customs ActAnalysis:1. Application of restriction imposed by Notification No. 64(RE-08)/04/09:The case involved the import of S S Seamless Tubes by the appellant-importer during a period when a restriction was imposed by Notification No. 64(RE-08)/04/09. The Revenue contended that the importer contravened the provisions of the notification by importing the goods during the restricted period. However, the importer argued that the order for import was placed before the restriction was imposed. The Tribunal noted that subsequent to the restriction, a circular was issued lifting the restriction and allowing the import of the goods without a specific license. Relying on legal precedents, the Tribunal held that the circular was clarificatory in nature and should have retrospective effect. Therefore, the Tribunal set aside the redemption fine imposed on the imported goods, as it was contrary to Customs law and the DGFT circular.2. Imposition of penalty under Section 112 of Customs Act:The Revenue appealed against the non-imposition of penalty under Section 112 of the Customs Act on the importer and their Customs House Agent (CHA). The Tribunal observed that the Revenue's appeal was related to the penalty aspect, while the importer's appeal was against the confirmed penalty imposed on them under Section 125 of the Customs Act for confiscated goods. The Tribunal's decision to set aside the redemption fine on the imported goods also impacted the penalty aspect, as the order imposing the fine was overturned. Consequently, the Tribunal rejected the Revenue's appeal as it did not survive after setting aside the Order-in-Original on merits.3. Confiscation of goods under Section 111(d) of Customs Act:The imported goods were confiscated under the provisions of Section 111(d) of the Customs Act, and the Adjudicating Authority allowed the option to redeem the goods under Section 125 of the Customs Act on payment of a redemption fine. However, the Tribunal, after considering the circumstances and the retrospective effect of the circular lifting the import restriction, set aside the redemption fine imposed on the goods. This decision rendered the appeal filed by the Revenue against the penalty aspect moot, leading to its rejection by the Tribunal.In conclusion, the Tribunal's judgment addressed the issues of import restriction, penalty imposition, and confiscation of goods under the Customs Act, ultimately setting aside the redemption fine and rejecting the Revenue's appeal.