Pre-shipment certification for scrap imports is mandatory; post-import customs checks do not cure the policy breach.

Import of metal scrap without the prescribed pre-shipment certificate remained liable to confiscation and penalty because post-import customs examination did not cure the breach of the import policy. The absence of an inspection agency at the place of export was not accepted as a justification where inspection could have been arranged or shipment avoided. A valuation challenge raised for the first time at the appellate stage was not entertained because no dispute on valuation had been raised or decided in the original adjudication. The redemption fine and penalty were reduced, with consequential refund subject to unjust enrichment.

---

---

Issues: (i) whether imported metal scrap was liable to confiscation and penal action for want of the prescribed pre-shipment certificate under the import policy, and (ii) whether the challenge to the valuation adopted by the department could be entertained at the appellate stage.

Issue (i): whether imported metal scrap was liable to confiscation and penal action for want of the prescribed pre-shipment certificate under the import policy.

Analysis: The import policy required pre-shipment certification to prevent import of dangerous material concealed in scrap consignments. Post-import examination by customs was held not to be a substitute for the mandated pre-shipment inspection. The absence of a local inspection agency at the place of export was not accepted as a justification, because the importer could have avoided the shipment or arranged inspection through an available agency. The earlier single-member view was not accepted as laying down the correct legal position.

Conclusion: The scrap consignments were rightly held liable to confiscation and the appellants were liable to penalty.

Issue (ii): whether the challenge to the valuation adopted by the department could be entertained at the appellate stage.

Analysis: The appellants had waived show cause notice and personal hearing before the original authority, and no valuation dispute had been raised or decided at that stage. In the absence of any original adjudication on valuation, the appellate challenge was not open for consideration.

Conclusion: The valuation challenge was rejected.

Final Conclusion: The imports remained confiscable and penal consequences were upheld in principle, but the redemption fine and penalty were reduced, with consequential refund subject to unjust enrichment.

Ratio Decidendi: Where import of scrap is made without the prescribed pre-shipment certificate, subsequent customs examination does not cure the breach, and the goods remain liable to confiscation and penalty.

---