Customs clearance despite FSSAI rejection report: penalty, confiscation and redemption fine held unsustainable absent misdeclaration or importer culpability.

Where Customs cleared imported goods despite already having the FSSAI rejection report, and the importer had no proven role in any contravention, penalty was held unsustainable and set aside. Confiscation and redemption fine were also found unsustainable because there was no material to establish misdeclaration, the goods had not been provisionally cleared on bond, and they were not physically available for seizure when proceedings began. The impugned order was set aside, with consequential relief granted according to law.

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Issues: (i) whether the penalty imposed on the importer was sustainable; (ii) whether the confiscation of the imported goods and the consequential redemption fine were sustainable.

Issue (i): whether the penalty imposed on the importer was sustainable.

Analysis: The goods were imported under a proper Bill of Entry, the FSSAI verification report had already been received by Customs and was reflected as logged in, and the consignment was nevertheless cleared by the department. The importer was found to have no specific role in the alleged contravention, and the belated show cause notice followed the department's own lapse in acting on the rejection report in time.

Conclusion: The penalty on the importer was not sustainable and was set aside.

Issue (ii): whether the confiscation of the imported goods and the consequential redemption fine were sustainable.

Analysis: The goods were not cleared provisionally, no bond was shown to have been executed, and there was no material to establish misdeclaration. The department had already allowed clearance despite holding the rejection report, and the goods were not physically available for seizure when proceedings were initiated.

Conclusion: The confiscation and the redemption fine were not sustainable and were set aside.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief according to law.

Ratio Decidendi: Where Customs clears imported goods despite already having the FSSAI rejection report and no misdeclaration or culpable role of the importer is established, penalty, confiscation, and redemption fine cannot be sustained.

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