Carnet-based customs exemption depends on exact vehicle particulars; mismatch justifies confiscation, but penalty needs contumacious conduct.

Temporary import under carnet entitled the vehicle to customs exemption only if it matched the carnet description in all material particulars, including registration details. Because the imported vehicles did not bear the registration numbers stated in the carnets, the statutory conditions for temporary import and duty-free treatment were not satisfied, and confiscation was justified. However, the absence of contumacious conduct meant that penal action against the importer was not warranted, so the penalty was set aside. Re-export of the vehicles to Dubai on payment of redemption fine was permitted, while confiscation otherwise stood.

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Issues: (i) whether vehicles imported under carnet were entitled to customs exemption and whether confiscation was justified when the vehicles did not correspond with the registration particulars stated in the carnets; (ii) whether penalty on the importer was warranted.

Issue (i): whether vehicles imported under carnet were entitled to customs exemption and whether confiscation was justified when the vehicles did not correspond with the registration particulars stated in the carnets.

Analysis: The carnet system and the exemption notification required the imported vehicle to correspond in all respects with the particulars described in the carnet. The prescribed form contemplated registration details as part of the vehicle description. Where the carnets mentioned registration numbers but the imported vehicles bore no such registration numbers, the statutory conditions for temporary importation and duty exemption were not satisfied. The customs authorities were therefore justified in treating the import as not covered by the carnet and in ordering confiscation. The importer's explanation that the omission arose from the Dubai supplier was not accepted on the facts.

Conclusion: The confiscation was upheld, but re-export to Dubai on payment of redemption fine was allowed.

Issue (ii): whether penalty on the importer was warranted.

Analysis: Although the import was held to be non-compliant with the carnet conditions, the record did not establish conduct of such a contumacious nature as to justify penal action. The earlier history of temporary imports and re-exports did not, by itself, require the imposition of a penalty in the circumstances found by the Tribunal.

Conclusion: The penalty was set aside.

Final Conclusion: The appeal succeeded only to the limited extent that the vehicle was permitted to be re-exported to Dubai on payment of redemption fine and the penalty was deleted, while the confiscation of the vehicles was otherwise sustained.

Ratio Decidendi: A vehicle imported under carnet can claim duty exemption only if it corresponds in all material particulars, including registration details, with the description in the carnet; non-compliance with that condition justifies confiscation, though penalty depends on the existence of contumacious conduct.

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