Import restrictions on second-hand diesel engines justified confiscation, but redemption fine had to be reconsidered on parity and valuation factors.

Second-hand diesel engines classified as consumer goods remained subject to the Import Control restricted list, so they could not be imported without a licence and were liable to confiscation. The fact that the goods were second-hand did not remove the licensing restriction. However, absolute confiscation was not sustained because similar consignments had earlier been released on redemption fine, and no special reason was shown to depart from that approach. In the absence of material on market value, profit margin, and related valuation factors, the matter was remitted for fixation of an appropriate redemption fine, taking prior releases, the condition of the goods, and demurrage into account.

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Issues: (i) whether second-hand diesel engines, falling within consumer goods, could be imported without a licence under the Import Control regime and whether they were liable to confiscation; (ii) whether absolute confiscation was justified or the goods should be permitted to be redeemed on payment of fine.

Issue (i): whether second-hand diesel engines, falling within consumer goods, could be imported without a licence under the Import Control regime and whether they were liable to confiscation.

Analysis: The goods were accepted to be diesel engines falling within the category of consumer items. Consumer items were shown to be in the Restricted List, and the Import Control Order did not override the restriction merely because the goods were second-hand. The control regime permitted free import only of goods not covered by the prohibited, restricted, or canalised lists. Since the imported goods were restricted and no licence was produced, the confiscation was justified.

Conclusion: The goods were correctly held liable to confiscation.

Issue (ii): whether absolute confiscation was justified or the goods should be permitted to be redeemed on payment of fine.

Analysis: The record showed that similar second-hand diesel engines had been released earlier on payment of redemption fine. No special circumstance was shown to depart from that practice. In the absence of material on market value, margin of profit, and related factors, the appropriate fine could not be fixed by the appellate forum itself, and the matter had to be sent back for determination of a suitable fine while taking prior releases, condition of the goods, and demurrage into account.

Conclusion: Absolute confiscation was not sustained, and redemption of the goods on payment of a suitable fine was directed with remand for quantification.

Final Conclusion: The confiscation was upheld, but the appellants were given the benefit of redemption and the matter was remitted for fixing the redemption fine in accordance with comparable earlier cases.

Ratio Decidendi: Goods falling within the Restricted List remain subject to licensing restrictions even if they are second-hand, but where comparable consignments have previously been released on redemption fine, absolute confiscation should not be maintained without considering parity and relevant valuation factors.

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