1991 (1) TMI 293 - AT - Customs

Customs Act Appeal Results: Partial win - Goods valued at Rs. 10,162 released, reduced penalty of Rs. 5,000 imposed.

The appeal against the order imposing fines and confiscation of goods under the Customs Act, 1962 was partially allowed. The confiscation of non-notified ... Confiscation and Penalty Issues:1. Appeal against the order imposing fine and confiscation of goods under the Customs Act, 1962.2. Contention regarding absolute confiscation of goods valued at Rs. 11,462 under Section 111(p) of the Act.3. Dispute over the classification of goods as notified and non-notified under Chapter IVA of the Customs Act, 1962.4. Interpretation of the Baggage Rules and applicability of Sec. 11G of the Import (Control) Order, 1955.5. Assessment of evidence regarding the nature and origin of the goods seized.Analysis:1. The appeal challenged the order imposing a fine and confiscation of goods valued at Rs. 12,150 under the Customs Act, 1962. The appellant contested the absolute confiscation of goods worth Rs. 11,462, arguing that only a portion of the goods were notified under Chapter IVA, while the rest were non-notified goods. The appellant's consultants emphasized that the non-notified goods were not proven to be contraband and questioned the adjudicating authority's decision.2. The adjudicating authority had released goods worth Rs. 11,355 but imposed a fine of Rs. 5,000 in lieu of confiscation of the remaining notified goods. The consultants argued that the non-notified goods, valued at Rs. 10,162, should not have been confiscated without sufficient evidence of being contraband. They highlighted the burden on the department to prove the goods' illicit nature, citing legal precedents supporting their stance.3. The consultants further contended that the goods were intended as gifts to boost sales in the departmental store, supported by advertisements promoting a gift scheme for buyers of Indian goods. They challenged the invocation of Sec. 11G of the Import (Control) Order, 1955, asserting its inapplicability to duty-free baggage items cleared under the Baggage Rules. The appellant sought the release of non-notified goods and a reduced penalty for the notified goods.4. The respondent argued against the commercial motive behind the gifts, stating that gifts should be given out of love and affection, not for trade promotion. Additionally, the respondent disputed the classification of goods as non-notified and raised concerns about the Baggage Rules not being specifically pleaded in the appellant's defense.5. The judge analyzed the evidence, noting that the appellant and family members frequently traveled abroad for business, bringing goods as baggage. The judge examined the passports and baggage receipts to confirm the legitimate import of goods. Considering the nature of the goods and the lack of evidence of commercial sale, the judge set aside the confiscation of non-notified goods valued at Rs. 10,162. However, the notified goods valued at Rs. 1,300 were held liable for confiscation under Chapter IVA, with a fine of Rs. 5,000 imposed. The judge allowed redemption of goods covered by valid baggage receipts and reduced the penalty to Rs. 1,000, granting a two-month redemption period.In conclusion, the appeal was partially allowed, with the confiscation of non-notified goods set aside and a reduced penalty imposed on the notified goods, subject to redemption within a specified timeframe.