Redemption instead of absolute confiscation for unauthorised foreign currency import where harsh penalty was considered excessive

Unauthorised import of foreign currency through a letter was treated as a case for redemption rather than absolute confiscation under the Customs Act. The currency was not considered concealed merely because it was found in the fold of the letter, and the small amount, together with the liberalised foreign exchange policy then encouraging remittances to residents in India, weighed against harsh confiscation. On those facts, absolute confiscation was considered too severe, and release on payment of redemption fine and production of the required no objection certificate was regarded as the proper course.

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Issues: Whether absolute confiscation of foreign currency imported through a letter was justified, or whether the case called for redemption of the currency on payment of fine under the Customs Act.

Analysis: The currency was not regarded as concealed merely because it was found in the fold of a letter. The record showed a shifting stand as to the purpose of sending the money, but the amount involved was small and the import had to be viewed in the context of the then liberalised policy encouraging remittance of foreign exchange to residents in India. In those circumstances, absolute confiscation was considered too harsh, and the proper course was to exercise the power of redemption in cases of unauthorised importation.

Conclusion: Absolute confiscation was unwarranted. The currency was directed to be released on payment of redemption fine and production of the required no objection certificate, resulting in relief to the assessee.

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