2004 (6) TMI 536 - AT - Customs

Summary

Issues involved:
Import of film scrap and film rolls by a 100% Export Oriented Unit, penalty imposed, interpretation of Exim Policy Circular, reduction of penalty under Section 112 of the Customs Act, 1962.

Analysis:

Issue 1: Import of film scrap and film rolls by a 100% Export Oriented Unit
The appellant, a 100% Export Oriented Unit, imported consignments of film scrap and film rolls. The goods, upon examination, were found to be serviceable films, with approximately 9800 kgs valued at Rs. 7,73,633/- being considered serviceable and restricted for imports as per the Revenue's contention.

Issue 2: Interpretation of Exim Policy Circular
The appellant argued that as per Public Notice No. 3/92-97 and Circular 27 (RE-2000) 1997-02, plastic scrap/waste includes fractions generated in the production process of plastic or those not put to any use, which can be considered as virgin or new material. The appellant contended that the goods fell within the permissible forms for import outlined in the Public Notice, raising a presumption in their favor.

Issue 3: Reduction of penalty under Section 112 of the Customs Act, 1962
Despite the presumption in favor of the appellant, the Tribunal acknowledged that the goods were subject to controls, procedures, and documentation during import by a 100% Export Oriented Unit. The Tribunal considered it a fit case to reduce the penalty imposed from Rs. 2.00 lakhs to Rs. 50,000/- under Section 112 of the Customs Act, 1962, taking into account the facts and circumstances of the case.

Conclusion:
The Tribunal, after considering the arguments and relevant provisions, reduced the penalty imposed on the appellant from Rs. 2.00 lakhs to Rs. 50,000/- under Section 112 of the Customs Act, 1962. The judgment highlighted the interpretation of the Exim Policy Circular in relation to the import of film scrap and film rolls by a 100% Export Oriented Unit, ultimately leading to the decision to reduce the penalty in this particular case.