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Issues:
1. Interpretation of import policy regarding the sale of replenished exempt material. 2. Requirement of permission from licensing authority for sale of imported goods. 3. Confiscation of seized goods and imposition of duty and penalty. 4. Reduction of penalty imposed on the importer. 5. Penalty imposition on Sunil J. Shah and Paras Warehousing Corporation. Analysis: 1. The judgment involved the interpretation of the import policy concerning the sale of replenished exempt material, specifically titanium dioxide, by an importer. The appellant argued that since it had completed a proportionate amount of its export obligation, it should be allowed to sell the remaining quantity as per paragraph 244(3) of the policy. However, it was found that the permission of the licensing authority was a mandatory requirement before selling such material, and the appellant failed to obtain this permission for over eight years, leading to a violation of the policy and notification 116/88. 2. The issue of the requirement of permission from the licensing authority for the sale of imported goods was crucial in this judgment. The appellant's delay in seeking permission was deemed unjustified, and the court emphasized that the sale without such permission was contrary to the law. The court highlighted that the conditions for sale were strict, and the absence of permission rendered the sale illegal, leading to the demand for duty and confiscation of the goods. 3. The judgment addressed the confiscation of seized goods, imposition of duty, and penalty. It was noted that the appellant had sold some goods without the necessary permission, leading to the demand for duty and confiscation of the sold quantity. However, a peculiar situation arose regarding the remaining seized goods at Paras Warehousing Corporation, as they were part of replenishment material and could be sold with permission. The court ordered a refund of sale proceeds if permission was obtained. 4. The court deliberated on the reduction of the penalty imposed on the importer. It was argued that since the export obligation had been fulfilled proportionately, the contravention was procedural. Consequently, the penalty was reduced from Rs. 25 lakhs to Rs. 7 lakhs, considering the procedural nature of the violation. 5. Lastly, the judgment addressed the penalty imposition on Sunil J. Shah and Paras Warehousing Corporation. It was found that Sunil J. Shah acted as a mediator in the sale in good faith, and there was no evidence to support penalty imposition. The court also noted that the penalty on Paras Warehousing Corporation lacked a legal basis as the notice did not call for a cause for penalty imposition. As a result, the penalties on Sunil J. Shah and Paras Warehousing Corporation were overturned. In conclusion, the judgment allowed appeal C/147/95 in part and allowed appeals C/130/95 and C/138/95.
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