TaxTMI 
TaxTMI 
1989 (2) TMI 295
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.... The brief facts for the purpose of disposal of the appeal can be stated as under :- The appellants imported 4000 kgs. of 120/2 MC blended silk wool yarn and filed four Bs/E for their clearance. The appellants claimed clearance of the goods against 3 REP duty free licences. The Customs however objected to the clearance on the ground that the licences produced are valid for import of only spun silk yarn as duty free import replenishment against REP licences as per App. 21 of 85/88 Import Policy where as the goods imported are blended spun silk yarn falling under entry No. (12) ofAppl. 2B and hence the licences are not valid to cover the items imported and the duty exemption benefit is also not available. It was also alleged that the impor....
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....ollector of Customs, Group III dated 2-3-1988, 6-3-1988 and 8-3-1988 urging him to allow the appellants to re-export the wrongly supplied goods. It was his submission that all these documents go to show that there was no mis-declaration as alleged by the department. All the 4 Bills of entry clearly show the description as "blended silk wool yarn 120/2 MC". The invoices annexed to the Bs/E also show the same description. In the context of these documents, the Collector's finding that there had been a mis-declaration and they have knowingly done, is not sustainable. He also indicated that even before filing the B/E on 5-2-1988, they got a telephonic message from the suppliers that instead of spun silk yarn they have wrongly despatched blen....
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.... $ per kg. Hence this conclusion arrived at by the Collector, is not warranted. The appellants repeated this plea for re-export of the wrongly shipped goods but this has not been heeded to. They were confiscated and allowed redemption on a total fine ofRs. 7.2 lakhs apart from a penalty of Rs. 3.6 lakhs in toto. 4. Shri Mondal, appearing on behalf of the Collector, however, justified the order of the Collector. Though the description of the B/E is for blended silk wool yarn of 120/2 MC, they have deliberately claimed duty free import under REP licence to which they are not entitled. They had attempted to celar the consignments duty free. When they noticed that this was not possible, they have invented the story of wrong shipment, which s....
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....ase. 6. After hearing both the sides and perusing the available records, we find that the main issues to be decided are as below : (i) Whether there is a mis-declaration justifying confiscation of goods under Section lll(m); (ii) Whether the goods are liable for confiscation under Section lll(d) of the Customs Act; (iii) Whether the appellants are liable for imposition of penalty under Section 112 of the Customs Act; and (iv) Whether the appellants can be allowed to re-export the goods without any fine. 7. It is observed that the conclusion arrived at by the Collector for holding that there was intention to import only blended silk wool yarn and not spun silk yarn, is based on the premises of comparison of contemporaneous ....
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....s imported are of this description only. Hence, when the Bs/E show the correct description of the goods, it is legally unsustainable to hold that they are liable for confiscation under Section lll(m). If the description of the goods on the Bs/E had been spun silk yarn, whereas the goods are found to be blended silk wool yarn, the order of confiscation under Section lll(m) would have been justified. No order of confiscation under Section lll(m) of the Customs Act can be sustained, when the goods have been declared correctly on the Bs/E. We, therefore, hold that the order of confiscation under Section lll(m) of the Customs Act is not sus-tainable and is required to be set aside. 8. Now coming to the issue regarding the liability of the goo....
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....behaviour. We are, therefore of the view that penalty for their attempt at unauthorised import can be justified on this ground. However, since the main charge of mis-declaration has been held by us as not sustainable, we deem it proper to reduce the penalty to Rs. 5,000/- (Rupees five thousand) against each Bs/E as against Rs. 90,000/- imposed by the Collector. 10. As regards the request for re-export the goods without fine, the matter has been carefully considered by us. Admittedly, in this case, the goods have not been covered by a valid licence, and hence they are liable for confiscation under Section 111 (d) of the Customs Act. Moreover, they were aware of the wrong despatch of the goods even at the time of filing the Bs/E, and hence....