2018 (11) TMI 98 - AT - Customs

Tribunal reduces penalty, imposes redemption fine, ensuring fair outcome for appellant

CFI Copiers Pvt. Ltd Versus CCT, Hyderabad GST

The Tribunal modified the impugned orders, reducing the penalty to 10% of the enhanced value and imposing a redemption fine of 20% of the enhanced value ... Import of restricted item - used multi functional photocopier machines without any licence - confiscation - redemption fine - penalty - Held that:- There is no dispute that the said photocopier machines are imported violating the provisions of Import Export Policy and not producing the licence for import of old used photocopier machines. To that extent, the orders of the lower authorities are upheld that the photocopier machines are liable for confiscation. Redemption Fine - Held that:- Hon’ble High Court of Punjab & Haryana in the case of Bhagwan Elector Photocopiers [2014 (11) TMI 996 - PUNJAB & HARYANA HIGH COURT] has felt that redemption fine against confiscation for the regular violators as 20% of the enhanced value of the photocopier machines - thus, appellant is required to pay redemption fine in both the appeals @ 20% of the enhanced value of the photocopier machines. Penalty - Held that:- The ends of natural justice would be met, if penalty is restricted to 10% of the enhanced value of the photocopier machines. Appeal allowed in part. Issues:Import of used photocopier machines without a license, mis-declaration of value, confiscation, redemption fine, penalty imposition, applicability of previous tribunal orders on redemption fine and penalty.Analysis:The appeals were filed against an Order-in-Appeal regarding the import of used multi-functional photocopier machines without a license. The machines were seized, and the appellant was directed to explain the declared value. The valuation was enhanced after inspection by Custom approved Chartered Engineers, and the appellant accepted the new valuation and paid the customs duty. The adjudicating authority and the first appellate authority concluded that the machines were imported in violation of licensing conditions and mis-declaration of value, justifying confiscation. A redemption fine of 25% and a penalty of 15% were imposed, which the first appellate authority upheld.The appellant argued that redemption fine and penalty should be fixed at 10% and 5% respectively based on Tribunal orders in similar cases. The Departmental Representative contended that the previous penalties were justified due to repeated violations by the appellant. The Tribunal observed that the imported machines indeed violated the Import Export Policy by not producing the required license. Referring to judgments of the Hon'ble High Court of Punjab & Haryana, the Tribunal determined that a redemption fine of 20% of the enhanced value was appropriate for regular violators. Consequently, the appellant was directed to pay a redemption fine of 20% and a penalty of 10% of the enhanced value of the machines.In conclusion, the Tribunal modified the impugned orders, reducing the penalty to 10% of the enhanced value and imposing a redemption fine of 20% of the enhanced value on the appellant for both appeals. The judgment was pronounced after considering the principles of natural justice to ensure a fair outcome for all parties involved.