Pre-shipment inspection certificate dispute: technical lapse did not justify confiscation, so redemption fine and penalty were set aside.

Imported stainless steel scrap accompanied by a pre-shipment inspection certificate issued by a DGFT-authorised agency was not liable to confiscation merely because no agency had been specifically notified for the country of export. The foreign trade policy did not make the goods prohibited on that ground, and confiscation under section 111(d) of the Customs Act is discretionary rather than automatic. The lapse was treated as at most a technical violation, so confiscation was unsustainable. As the confiscation failed, the redemption fine and consequential penalty also could not be maintained and were set aside.

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Issues: Whether imported stainless steel scrap was liable to confiscation for want of a pre-shipment inspection certificate from an agency notified for the country of export, and whether redemption fine and penalty could be sustained.

Analysis: The imported goods were accompanied by a pre-shipment inspection certificate issued by a DGFT-authorised agency, though not specifically notified for the country of export, because no agency had been notified there. The relevant foreign trade policy requirements did not justify treating the import as prohibited merely because no notified agency existed in that country. Confiscation under section 111(d) of the Customs Act, 1962 is not automatic; goods are only liable to confiscation, leaving discretion with the adjudicating authority. On the facts, any lapse was at most a technical violation and did not warrant confiscation. Once confiscation was unsustainable, the redemption fine and consequential penalty could not survive.

Conclusion: The confiscation, redemption fine, and penalty were set aside and the appellant obtained relief.

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