1992 (5) TMI 133 - AT - Customs

Tribunal upholds decision on confiscated goods under Customs Act

The tribunal upheld the decision to confiscate imported goods, consisting of instruments, under the Customs Act. The goods were deemed not to qualify as ... Words & Phrases - ‘Spares’ and ’Accessories’ Issues:1. Confiscation of imported goods under Customs Act.2. Interpretation of import licence for spares of machinery/instruments.3. Classification of imported items as spares or complete instruments.4. Application of Policy Books AM 85-88 and AM 88-91.5. Validity of clearance under import licence.6. Mitigating circumstances for penalty imposition.7. Quantum of redemption fine under Customs Act.Detailed Analysis:1. The judgment pertains to an appeal against the confiscation of imported goods consisting of Digital Multimeter, Clamp Meters, and Digital Clamp Meter under Section 111(d) of the Customs Act. The Collector of Customs had ordered confiscation with an option to pay a fine of Rs. 50,000. The appeal challenged this order, arguing that the goods were spares for machinery/instruments listed in the import licence.2. The import licence was issued for spares of machinery/instruments during the policy period AM 1985-88. The authorities contended that the imported items did not qualify as spares under the licence as they were complete instruments, not listed in the licence. The Collector of Customs upheld this decision, citing provisions from Policy Books AM 85-88 and AM 88-91.3. The appellant argued that the imported items were indeed spares for the listed machinery/instruments and provided a certificate from a Chartered Engineer to support this claim. However, the authorities maintained that the items were instruments as per technical definitions and were not accessories contributing to the effectiveness of the equipment as required by the policy definitions of spares.4. The judgment analyzed the definitions of spares and accessories under the Policy Book AM 85-88. It highlighted that the imported items were described as complete instruments in catalogues and did not meet the criteria of contributing to the equipment's effectiveness as required for classification as accessories or spares under the licence.5. The tribunal concluded that the imported items did not qualify as spares covered under the licence and were not permissible for import under the relevant policy provisions. The decision to confiscate the goods under Section 111(d) of the Customs Act was upheld, but the redemption fine was reduced to Rs. 25,000 considering mitigating circumstances and prior import clearances.6. The judgment emphasized that while the appellant was not penalized personally, the clearance of some parcels under the same licence did not validate the import of non-qualifying items. The decision confirmed the findings of the authorities regarding the ineligibility of the imported items as spares and upheld the confiscation order with a modified redemption fine.7. In conclusion, the tribunal affirmed the lower authority's decision, confirming the confiscation of the imported goods and reducing the redemption fine. The appeal was disposed of accordingly, with consequential relief to follow.