2003 (9) TMI 162 - AT - Customs

Tribunal Adjusts Fines and Confirms Duty Refunds, Reduces Penalties and Affirms Most of Commissioner's Order.

The Tribunal modified the Commissioner's order by reducing the redemption fine to Rs. 85,000/- for undeclared goods and setting aside the confiscation and ... Confiscation and redemption fine - Demand - payment towards differential duty - Penalty - HELD THAT:- We are inclined to agree with the ld. Advocate that goods valued at Rs. 3,68,064/- which were not declared to the customs alone are liable for confiscation u/s 111(m) and not the entire goods valued at Rs. 14,58,482/-. We therefore reduce the redemption fine from Rs. 1.50 lakh to Rs. 85,000/-. The order of the Commissioner confiscating the goods of Rs. 13,21,82,873/- which were not available for confiscation as they have been cleared long back cannot be sustained in view of the well settled legal position and the law laid down by this Bench in number of cases and by various coordinated Benches. We have in the matter of Prudential Pharmaceuticals Ltd. v. CC, [2001 (8) TMI 175 - CEGAT, CHENNAI] have held that redemption fine is not imposable when goods are not available for confiscation and is outside the purview and legal provisions as contained u/s 125 of the Customs Act, 1962. We therefore set aside the order of the Commissioner of confiscating the goods valued at Rs. 13,21,82,873/- u/s 111(m) of the Customs Act, 1962 which were cleared long back and which were not available for confiscation. We also set aside the order of imposition of fine of Rs. 5.00 lakhs in lieu of confiscation. The appellants had deposited a sum of Rs. 14.00 lakhs as per the direction of DRI but are being consistently maintaining that the goods which have been abandoned by them and not redeemed, no duty can be demanded from them. We are inclined to agree to the contention of the Advocate and we therefore direct the Commissioner not to charge any duty on the goods which were confiscated but not redeemed. To that extent the duty should be deducted and refund granted them suo motu. As regards mandatory penalty of Rs. 2,48,409/- imposed u/s 114A of the Customs Act, 1962, we reduce the same to Rs. 1.25 lakh. As regards the imposition of penalty for the goods imported prior to 28-9-96 we confirm the penalty of Rs. 3.00 lakhs imposed u/s 112(a) of the Customs Act, 1962 on the appellant-assessee. As regards the penalty of Rs. 1.00 lakh on Shri Vikas Chandra, Managing Director, M/s. Comptech Electronics P. Ltd., Chennai u/s 112(a) of the Customs Act, 1962, we find that the penalty of Rs. 1.00 lakh is on the higher side and we reduce the same to Rs. 25,000/-. We confirm the rest of the order passed by the ld. Commissioner. But for the above modification, the impugned order is sustained. Ordered accordingly. Issues Involved:1. Confiscation of goods u/s 111(m) of the Customs Act, 1962.2. Imposition of redemption fine u/s 125 of the Customs Act, 1962.3. Demand of duty u/s 28(1) of the Customs Act, 1962.4. Imposition of penalty u/s 114A and 112(a) of the Customs Act, 1962.5. Adjustment of payment towards differential duty.Summary:1. Confiscation of Goods u/s 111(m) of the Customs Act, 1962:The Commissioner ordered the confiscation of goods valued at Rs. 14,58,842/- covered under Bill of Entry No. 36803, dated 14-7-97, and goods cleared under previous Bills of Entry valued at Rs. 13,21,82,873/-. The Tribunal agreed that only goods valued at Rs. 3,68,064/- which were not declared to customs are liable for confiscation, not the entire consignment. The order of confiscating goods valued at Rs. 13,21,82,873/- which were not available for confiscation was set aside.2. Imposition of Redemption Fine u/s 125 of the Customs Act, 1962:The Commissioner allowed the confiscated goods to be redeemed on payment of a redemption fine of Rs. 1,50,000/-. The Tribunal reduced the redemption fine to Rs. 85,000/- for the undeclared goods valued at Rs. 3,68,064/-. The fine of Rs. 5,00,000/- imposed in lieu of confiscation for goods cleared previously was also set aside.3. Demand of Duty u/s 28(1) of the Customs Act, 1962:The Commissioner demanded duty of Rs. 16,73,368/- from M/s. Comptech Electronics Pvt. Ltd., Chennai. The Tribunal directed that no duty should be charged on goods which were confiscated but not redeemed and ordered a refund for the same.4. Imposition of Penalty u/s 114A and 112(a) of the Customs Act, 1962:The Commissioner imposed a penalty of Rs. 2,48,409/- u/s 114A and Rs. 3,00,000/- u/s 112(a) for goods imported prior to 28-9-96. The Tribunal reduced the penalty u/s 114A to Rs. 1.25 lakh and confirmed the penalty of Rs. 3.00 lakhs u/s 112(a). The penalty of Rs. 1.00 lakh on Shri Vikas Chandra, Managing Director, was reduced to Rs. 25,000/-.5. Adjustment of Payment Towards Differential Duty:The Commissioner ordered the adjustment of Rs. 14,00,000/- paid by M/s. Comptech Electronics P. Ltd. towards differential duty. The Tribunal directed that the duty should be deducted for goods not redeemed and a refund should be granted suo motu.Conclusion:The Tribunal modified the impugned order by reducing the redemption fine, setting aside the confiscation and fine for goods not available for confiscation, reducing penalties, and directing refunds for duties on non-redeemed goods. The rest of the order was confirmed.