Procedural customs breach without prohibited goods did not justify vehicle confiscation, though a moderated penalty was still upheld.

Imported goods that had already suffered customs duty and were neither contraband nor prohibited could not justify confiscation of the transporter's vehicle merely because they were moved from the customs area without out-of-charge clearance, especially when the movement was at the importer's and CHA's instructions; the confiscation and redemption fine were therefore set aside. The transporter still breached customs procedure by moving the consignment before clearance, so a penalty remained warranted, but it was reduced to a moderated amount in the interests of justice. The stated ratio is that procedural non-compliance alone does not support vehicle confiscation where the goods are otherwise lawful, though penal consequences may still follow.

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Issues: (i) Whether confiscation of the transporter's vehicle and the consequential redemption fine were sustainable for removal of imported goods from the customs area without out-of-charge clearance; (ii) whether the penalty imposed on the transporter required interference.

Issue (i): Whether confiscation of the transporter's vehicle and the consequential redemption fine were sustainable for removal of imported goods from the customs area without out-of-charge clearance.

Analysis: The imported goods had already suffered full customs duty, and the movement of the consignment without out-of-charge clearance occurred on the instructions of the importer and the CHA. Although the transporter acted without waiting for the requisite customs clearance, the goods were neither contraband nor prohibited or restricted. In these circumstances, confiscation of the vehicle was found to be unjustified.

Conclusion: The confiscation and the consequential redemption fine were set aside.

Issue (ii): Whether the penalty imposed on the transporter required interference.

Analysis: The transporter did contravene the customs procedure by moving the goods without obtaining out-of-charge clearance, even if he acted on the directions of the importer and the CHA. Some penal consequence was therefore warranted, but the quantum required moderation in the interests of justice.

Conclusion: The penalty was sustained in principle but reduced to Rs. 25,000.

Final Conclusion: The appeal succeeded to the extent that confiscation and redemption fine were annulled, while the penalty was substantially reduced.

Ratio Decidendi: Where imported goods have suffered duty and are neither contraband nor prohibited, confiscation of the transporter's vehicle for procedural breach alone is unwarranted, though a moderated penalty may still be imposed for non-compliance with customs clearance requirements.

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