Used photocopiers and printers: confiscation allowed, but absolute confiscation rejected; separate proprietor penalty and registration breach also set aside.

Used second-hand multifunction digital photocopiers and printers were treated as confiscable for import policy violation, but not as prohibited goods warranting absolute confiscation; release on redemption terms was considered appropriate, with fine and penalty fixed by reference to the re-assessed value and customs duty payable. Separate penalties on the proprietors were set aside because the firm had already been penalised for the same transaction. The alleged breach of the Compulsory Registration Order was also rejected, as the imported MFDs were not specifically notified under that regime and the order could not be extended by departmental letter to unnotified goods.

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Issues: (i) Whether the imported second-hand multifunction digital photocopiers and printers were liable only to confiscation under the Customs Act or could be absolutely confiscated, and what redemption fine and penalty were ; (ii) Whether separate penalty could be sustained on the proprietors under Section 114AA; (iii) Whether the Compulsory Registration Order applied to the imported goods.

Issue (i): Whether the imported second-hand multifunction digital photocopiers and printers were liable only to confiscation under the Customs Act or could be absolutely confiscated, and what redemption fine and penalty were .

Analysis: The imports were of used MFDs without DGFT authorisation, attracting confiscability under Section 111(d) of the Customs Act, 1962. However, the goods were treated as restricted rather than prohibited goods in the earlier Tribunal decision involving similar imports, which had been affirmed in substance by the Supreme Court. The reasoning also recognised that used machines with residual life cannot be treated as waste merely because they are second-hand, although certain conditions under the hazardous waste regime may still be relevant. In that background, absolute confiscation was not justified. The appropriate course was release on redemption terms, following the same yardstick applied in the earlier case.

Conclusion: The goods were liable to confiscation, but not to absolute confiscation; they were directed to be released on payment of redemption fine at 10% of the re-assessed value, penalty at 5% of the re-assessed value, and applicable customs duty, in favour of the assessee.

Issue (ii): Whether separate penalty could be sustained on the proprietors under Section 114AA.

Analysis: The importing firm and its proprietor were treated as not distinct for the purpose of the penalty already imposed on the firm under Section 112(a) of the Customs Act, 1962. Since the firm had already been penalised, a further separate penalty on the proprietor was considered unnecessary.

Conclusion: The separate penalties imposed on the proprietors were set aside, in favour of the assessee.

Issue (iii): Whether the Compulsory Registration Order applied to the imported goods.

Analysis: The schedule to the Compulsory Registration Order covered printers and photocopiers, but the imported MFDs were not specifically notified under that order. The Tribunal followed the view that the order could not be extended to goods not notified, and the departmental letter could not override that position.

Conclusion: The imports were not held to be in violation of the Compulsory Registration Order, in favour of the assessee.

Final Conclusion: The appeals succeeded in part: the confiscation findings were sustained, but absolute confiscation was replaced by redemption on fine and penalty, the separate proprietor penalties were annulled, and the alleged compulsory registration violation was rejected.

Ratio Decidendi: Used goods may be confiscable for import policy violation, yet where they are not prohibited goods and are not shown to be waste or covered by a notified compulsory-registration regime, absolute confiscation is unwarranted and redemption on proportionate fine and penalty is the proper relief; separate penalty on the proprietor is unnecessary when the firm has already been penalised for the same transaction.

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