Used medical equipment imports: expert evidence and customs relaxations defeated confiscation, misdeclaration, redemption fine and penalty.

Reliable expert evidence showing substantial residual life, together with COVID-19-related customs relaxations for medical equipment, supported the view that the imported used medical equipment was neither hazardous nor e-waste. On that basis, the confiscation finding for the relevant goods was unsustainable and the import was treated as regular. Once the goods were not liable to confiscation, the allegations of misdeclaration also fell away, and the redemption fine under Section 125 of the Customs Act, 1962 could not survive. For the same reason, penalty under Sections 112(a)(i) and 112(a)(ii) was also not maintainable.

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Issues: (i) whether the imported used medical equipment could be treated as prohibited, hazardous or e-waste and be confiscated under the Customs Act, 1962; (ii) whether the allegations of misdeclaration, redemption fine and penalty under the Customs Act, 1962 were sustainable.

Issue (i): whether the imported used medical equipment could be treated as prohibited, hazardous or e-waste and be confiscated under the Customs Act, 1962.

Analysis: The imported goods were supported by a panel chartered engineer's report stating that the equipment had substantial residual life and was neither e-waste nor hazardous. That expert opinion was treated as relevant and binding in the absence of contrary documentary material. The import was also viewed in the context of COVID-19 related relaxations issued by the Government through customs notifications granting exemptions and easing import conditions for medical equipment. On that factual and legal basis, the finding that the goods in Table 6 and Table 10 were prohibited or improperly imported was held unsustainable.

Conclusion: The confiscation of the goods was not justified and the finding that they were prohibited or hazardous was set aside in favour of the assessee.

Issue (ii): whether the allegations of misdeclaration, redemption fine and penalty under the Customs Act, 1962 were sustainable.

Analysis: Once the import was held to be regular and the bill of entry stood regularized on re-assessment, the basis for treating the goods as liable to confiscation disappeared. In the absence of improper importation, redemption fine under Section 125 of the Customs Act, 1962 could not survive. For the same reason, penalty under Sections 112(a)(i) and 112(a)(ii) of the Customs Act, 1962 was also not maintainable. The allegation of misdeclaration was therefore not accepted.

Conclusion: The allegations of misdeclaration, redemption fine and penalty were unsustainable and were set aside in favour of the assessee.

Final Conclusion: The import was held to be regular and not liable to confiscation, and the consequential fine and penalty were annulled.

Ratio Decidendi: Where reliable expert evidence and contemporaneous governmental relaxation of import restrictions show that the goods are neither hazardous nor improperly imported, confiscation, redemption fine and penalty under the Customs Act cannot be sustained.

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