1999 (2) TMI 429 - AT - Customs

Summary

Issues:
1. Confiscation of Sandalwood chips and penalty under Customs Act.
2. Validity of certificate of origin and transport permits.
3. Mis-declaration and contravention of Rules under Tamil Nadu Sandalwood Transit Rules, 1967.
4. Grant of redemption under Section 125 of the Customs Act.

Confiscation of Sandalwood chips and penalty under Customs Act:
The appeal stemmed from an order for the absolute confiscation of 10 MTs of Sandalwood chips valued at Rs. 21,20,000 under Sections 113(d) and 113(i) of the Customs Act. The appellants had obtained a license to export the goods but were accused of using forged documents, including a certificate of origin and transport permits. The Commissioner concluded that the certificate of origin was invalid, leading to the unauthorized export and subsequent confiscation of the goods, along with the imposition of a penalty.

Validity of certificate of origin and transport permits:
Investigation revealed discrepancies in the certificate of origin and transport permits submitted by the exporters. The certificate of origin, supposedly issued by the Forest Department, was found to be forged. The Commissioner highlighted the requirements for a valid certificate of origin and noted that the appellants' actions did not comply with the rules, leading to the conclusion of mis-declaration and violation of the Tamil Nadu Sandalwood Transit Rules, 1967.

Mis-declaration and contravention of Rules under Tamil Nadu Sandalwood Transit Rules, 1967:
The Commissioner found that the appellants' export attempt was unauthorized due to the use of forged documents and misrepresentation of the source of the goods. The violation of Rule 3 of the Tamil Nadu Sandalwood Transit Rules, 1967 led to the confiscation of the goods and the imposition of a penalty. The appellants' argument of bona fide belief in the authenticity of the documents was rejected by the Commissioner.

Grant of redemption under Section 125 of the Customs Act:
The key issue raised during the appeal was whether the appellants should have been granted redemption under Section 125 of the Customs Act to recover the confiscated goods. The appellants argued for redemption based on their possession of a valid export license and letter of credit. They cited previous judgments where redemption was granted despite violations. The Tribunal noted the lack of consideration for redemption in the impugned order and referred to a Supreme Court judgment emphasizing the Collector's discretion to allow redemption. Consequently, the matter was remanded to the Commissioner for reevaluation, including the appellants' plea for redemption and a possible reduction in the penalty.

In conclusion, the appeal was allowed for a fresh consideration by the Commissioner in light of relevant legal precedents and the appellants' arguments regarding redemption and penalty reduction.