TaxTMI 
TaxTMI 
2026 (9) TMI 424
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....- under Section 125 of the Customs Act, 1962 and also imposed penalty of Rs.10,000/- under Section 112(a) of the Customs Act, 1962. On appeal by the Revenue and the appellant, the Commissioner (Appeals) dismissed the appeal filed by the appellant and allowed the appeal filed by the Revenue and held that the goods were liable for absolute confiscation without redemption fine and also enhanced the penalty under Section 114AA of the Customs Act, 1962 from Rs.10,000/- to Rs.1,00,000/-. 3. The learned Authorised Representative (AR) for the Revenue reiterating the findings of the Commissioner (Appeals) submits that the goods were liable for absolute confiscation in view of the fact that the goods were found to be second hand goods on examination and are restricted as per the Foreign Trade Policy and the Commissioner (Appeals) hence absolutely confiscated the goods and also enhanced the penalty. 4. Countering his arguments, the learned counsel for the appellant submits that the goods were not second hand goods; hence, the question of holding the imported goods as restricted goods cannot be sustained. Accordingly, redemption fine and penalty also cannot be sustained. 5. Heard both....
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....L.T. 145 (S.C.)] which will suffice. Redemption fine in lieu of confiscation - Option to pay Adjudicating Authority had exercised discretion to release goods with redemption fine and penalty; thus, option to pay redemption fine given without consideration of other alternative to absolute confiscation - Exercise of such discretion was assumptive and ritualistic, rather than conscious and cautious adherence to applicable principles On facts, as imports were contrary to relevant D.G.F.T. Notification Nos. S.O. 1478(E), 1479(E), 1480(E) and 1481(E), dated 29-3-2019 Notice and subsequent D.G.F.T. Trade Notice No. 6/2019-2020, dated 16-4-2019 regarding quantities more than annual quota that could adversely impact economy, absolute confiscation was proper - As imports were not bona fide no leniency can be given to importer on basis of equity and having suffered huge losses - Section 125(1) of Customs Act, 1962. [paras 80, 81, 86.11. (Emphasized) Adjudication-Discretion - Exercise of discretion by Adjudicating Authority as per first part of Customs Act has to be guided by law, according to rules of reason and justice, based on relevant considerations - Exercise of disc....
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....g authority....... (i) where an order or decision has been passed without following the principles of natural justice; or (ii) where no order or decision has been passed after reassessment under section 17; or (iii) where an order of refund under section 27...... the applicant.]: Provided that an order enhancing any penalty or fine in lieu of confiscation or confiscating goods of greater value or reducing the amount of refund shall not be passed unless the appellant has been given a reasonable opportunity of showing cause against the proposed order. Provided further that where the Commissioner (Appeals) is of opinion that any duty has.......................... in section 28 to show cause against the proposed order. (Emphasized) The provisions of Section 128A are very clear and reading the aforementioned provisions indicates that appellate authority has power vested to reduce or enhance the penalty imposed by the lower adjudicating authority by providing reasonable opportunity to the appellant or respondent company. Also, at para 9.1 the Commissioner (Appeals) justifies the enhancement of penalty under Section 114AA, consid....
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....ports in question, the personal interests of the importers who made improper imports are pitted against the interests of national economy and more particularly, the interests of farmers. This factor alone is sufficient to find the direction in which discretion ought to be exercised in these matters. When personal business interests of importers clash with public interest, the former has to, obviously, give way to the latter. Further, not a lengthy discussion is required to say that, if excessive improperly imported peas/pulses are allowed to enter the country's market, the entire purpose of the notifications would be defeated. The discretion in the cases of present nature, involving far-reaching impact on national economy, cannot be exercised only with reference to the hardship suggested by the importers, who had made such improper imports only for personal gains. The imports in question suffer from the vices of breach of law as also lack of bona fide and the only proper exercise of discretion would be of absolute confiscation and ensuring that these tainted goods do not enter Indian markets. Imposition of penalty on such importers; and rather heavier penalty on those who have been....