Redemption fine in customs matters is unwarranted where importers relied on official clarification and acted without mala fides.

Redemption fine in lieu of confiscation is unwarranted where importers relied on a specific clarification from import control authorities and the record shows no conscious disregard of licensing requirements. Even if confiscation of the imported goods could otherwise be sustained, the absence of contumacious, dishonest, or mala fide conduct means monetary penalty by way of redemption fine is not justified. In such circumstances, a caution would be sufficient, and the redemption fine is set aside.

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Issues: Whether redemption fine in lieu of confiscation was justified in respect of the imported goods.

Analysis: The importers had obtained a specific clarification from the import control authorities before importing the goods, and the record showed no conscious disregard of the licensing requirements. Even assuming the goods were liable to confiscation, the circumstances did not warrant imposition of redemption fine, as the conduct was not contumacious, dishonest, or mala fide. A mere caution would have sufficed.

Conclusion: The redemption fine was not justified and was set aside in favour of the assessee.

Ratio Decidendi: Where importers act on a specific official clarification and there is no mala fide or contumacious conduct, redemption fine in lieu of confiscation is unwarranted even if confiscation is otherwise sustainable.

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