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Issues: Import of spare parts under OGL 4/88-91, Confiscation of goods, Compliance with warranty terms, Possession of import license, Redemption fine, Imposition of personal penalty.
Import of Spare Parts under OGL 4/88-91: The case involved the importation of spare parts along with a compressor under OGL 4/88-91. The dispute arose when Customs found additional parts not covered in the invoice. The appellants argued that the parts fell under sub-item (6) of OGL 4/88-91 as they were replacements supplied free of charge. However, the adjudicating authority rejected this claim, stating that the parts were not supplied free of charge based on a service contract. The Tribunal analyzed the situation, noting that while the compressor was allowed, the parts were not given the benefit of OGL-4. The Tribunal concluded that the parts did not strictly comply with the conditions of OGL-4 and upheld the confiscation under Section 111(d) of the Customs Act. Compliance with Warranty Terms: The Tribunal considered the warranty terms and the service contract to determine if the spare parts were indeed supplied free of charge. Despite the parts being covered under warranty and an invoice indicating no charge, the Tribunal inferred from the service contract's payment provisions that the parts were paid in advance. As a result, the Tribunal agreed with the adjudicating authority that the conditions of OGL-4, item (6) were not met, leading to the confiscation of the goods under Section 111(d) of the Customs Act. Possession of Import License: During the proceedings, it was highlighted that the importers were not informed about the confiscation of goods due to a lack of license. The appellants claimed to possess sufficient licenses to cover the goods and requested an opportunity to produce a valid license. The Tribunal granted this request, giving the appellants a chance to present a valid license for clearance. If a valid license was produced and accepted, the confiscation would be set aside; otherwise, the goods would remain confiscated. Considering the circumstances and the appellants being actual users, the Tribunal reduced the redemption fine from Rs. 1,75,000 to Rs. 90,000. Imposition of Personal Penalty: The Tribunal assessed the imposition of a personal penalty of Rs. 2,500 on the appellants. After reviewing the facts and circumstances of the case, the Tribunal found insufficient justification for the penalty. Consequently, the Tribunal set aside the personal penalty of Rs. 2,500. Conclusion: The Tribunal disposed of the appeal by upholding the confiscation of goods due to non-compliance with OGL-4 conditions. It allowed the appellants to produce a valid import license for clearance, reducing the redemption fine and setting aside the personal penalty imposed on the appellants.
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