2006 (10) TMI 370

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.... two Steinex machines of CIF value of Rs. 12,22,286.50 vide Bill of Entry dated 5-9-1995 under EPCG Licence dated 5-12-1994. Exemption was claimed under Notification 160/92-Cus., dated 20-4-1992. Revenue proceeded against the appellants on the ground that they had failed to fulfill the export obligation in respect of both the licences. The Commissioner, in the impugned order, held that the Capital Goods imported under both the licenses are liable for confiscation under Section 111(o) of the Customs Act, 1962. However, he imposed a redemption fine of Rs. 3,00,000/- under Section 125 of the Customs Act. He confirmed the duty demand of Rs. 10,75,337/- in terms of Notification 160/92-Cus., dated 20-4-1992 read with para 103(i) of the Handbook o....

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....duty is correct in law. Once the differential duty is paid, the appellants go out of the EPCG scheme and confiscation of the goods under 111(o) of the Customs Act, 1962 cannot be sustained. Hence, we set aside the order of confiscation and imposition of fine and penalty. It should be appreciated that due to recession in the International market, the appellants could not fulfill the export obligations.   When the appellants are suffering financially for no fault of theirs, it would be harsh to penalize them for circumstances beyond their control. 6.1 With regard to giving benefit to the appellants for partial fulfillment of export obligation, it is seen that Notification 160/92-Cus. has not provided any such relief. Therefore....