AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (9) TMI 522
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.... it was valued at Rs. 54,76,406/-. A show-cause notice was issued to the appellant seeking to recover Customs duty and to impose penalty under Section 112A of the Customs Act. The notice also sought to confiscate the gold found short in the factory premises. The matter was adjudicated and demand of Customs duty on the shortage of gold was confirmed 14431.59 grams of gold valued at Rs. 60,22,879/- was ordered to be confiscated. The Revenue reviewed the said order on the following grounds: "The adjudicating authority held that the 14431.59 grams of gold valued at Rs. 60,22,879/- were liable for confiscation under the provisions of Section 111 (o) and 111 (j) of Customs Act, 1962. However, the goods were not available for confiscation and hence he should have imposed fine in lieu of confiscation under the provisions of Section 125 of the Customs Act, 1962. Instead, he has only imposed penalty under Section 112 (a) of Customs Act, 1962. In terms of Notification No.117/94-Cus dated 21/10/1994 as amended, specified goods are allowed to be imported without payment of duty for the purpose specified in the said notification on the strength of a bond executed for the said purpose. In terms....
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....ution of bond and, on the basis of this fact, it was held by the apex court that the Customs authorities were entitled to confiscate the goods with option for redemption against payment of fine under Section 125 of the Act. 17. In the Mumbai case, no fine was imposed by the learned Commissioner apparently on the ground that the goods were not available for confiscation. This part of the Commissioner s order was not challenged by the Revenue. In the Chennai case, on the other hand, the learned Commissioner imposed a redemption fine under Section 125 of the Act in lieu of confiscation of the goods, quite justifiably, on the facts of the case. This part of the Commissioner s order in the Chennai case is under challenge by the appellant and this challenge cannot succeed in view of the decision in Weston Components (supra). The learned counsel has argued that the bond executed by the assessee in the case of Weston Components (supra) was a different kind of bond and, therefore, that decision cannot be made applicable to the instant case. The counsel has not produced a copy of the bond to establish the point. However, he has fairly admitted that the bond was executed under Notification ....
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....cuted any bond for provisional release of any goods in terms of Section 110A of the Customs Act, 1962. He further submitted that the bond mentioned by the Original Authority in his order dated 18-8-2006 is for the clearance of goods on payment of provisional duty. In the present case in the absence of any seizure thereafter provision release of goods under bond, confiscation or imposition of redemption fine are not sustainable. We find that reliance placed by Revenue on the decision of Hon'bleSupreme Court in Weston Components Ltd. v. CC, New Delhi (supra) is misconceived. In the said case, there was a seizure and provisional release against a bond, undertaking to produce the goods when called for. In such situation, the Hon'bleSupreme Court held that redemption fine can be imposed if the goods are already cleared. Since, such release of goods is on execution of bond such fine was justified. We find that the Hon'blePunjab & Haryana High Court in CC, Amritsar v. Raja Impex (P) Ltd. reported in 2008 (229) E.L.T. 185 (P & H) held :- "12. It may also be noticed here that in the case of M/s. Weston Components Ltd. v. Commissioner of Customs, New Delhi (supra), the goods were released ....
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....found in the premises of a unit located in SEEPZ was examined. Para 7 of the said order reads as follows: "7. Revenue argued that the platinum imported was on execution of bond under Notification No. 137/2000 which require them inter alia to dispose of the said goods or service in terms of the notification and bond. The said bond also bound them to the condition that in case of failure to utilise the said goods for the said purpose within a period of five years to pay an amount equal to the duty leviable on the said unutilized goods along with interest @ 25% on the said duty from the duty of importation till payment of such duty. Revenue has relied on the decision of the Hon'bleSupreme Court in the case of Weston Components Ltd. v. CC, New Delhi - 2000 (115) E.L.T. 278 (S.C.) (supra). In the said decision, following has been observed : It is contended by the learned Counsel for the appellant that redemption fine could not be imposed because the goods were no longer in the custody of the respondent-authority. It is an admitted fact that the goods were released to the appellant on an application made by it and on the appellant executing a bond. Under these circumstances if subseq....
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....in 2008 (226) E.L.T. 571 (Tri.-Bang.). In this case, the goods held to be liable for confiscation in paras 116(ii), (iii) & (iv) of the impugned order are neither available for confiscation nor the same had been released provisionally against bond. Therefore, no redemption fine could be imposed under Section 125 of the Customs Act. It is noticed that in the said case, there was no bond for the use of goods in a particular manner. I find that in similar circumstances the Tribunal has observed as follows (i) Kay Bee Tax Spin Ltd. - 2014 (305) E.L.T. 132 The Revenue is in appeal only for reason that the Adjudicating Authority has not ordered for confiscation of the raw materials despite there being a bond executed by the assessee. We find that the main plank of the Revenue s appeal is that the commissioner has erred in refraining from formally confiscating and imposing redemption fine on of goods. In our view, the revenue appeal is on diversion of imports and inasmuch as when the goods are not there for confiscation, the question of confiscation cannot arise. Reliance placed by the revenue on the judgment of the Supreme Court in the case of Western Components [2000 (115) E.L.T. ....