2004 (10) TMI 507 - AT - Customs

Summary

Issues involved: Redemption fine re-fixation u/s Tribunal's order of remand, excessive redemption fine contention, comparison of landed price with domestic manufacturers' price, ignorance of Floor Price Notification, imposition of redemption fine justification, ceiling and fixing of redemption fine u/s Customs Act.

Redemption fine re-fixation u/s Tribunal's order of remand:
The impugned adjudication order was passed following a Tribunal's order of remand directing the re-fixation of the redemption fine considering the market price of the goods and the legal position.

Excessive redemption fine contention:
In the remand proceedings, the Commissioner reduced the redemption fine from Rs. 10 Lakhs to Rs. 7.25 Lakhs. The appellant argued that the fine was excessive, citing a comparison between the landed price of the consignment and the price of domestic manufacturers, resulting in a profit margin of only Rs. 80,000.

Ignorance of Floor Price Notification:
The appellant contended that the goods were ordered and LC opened before the issuance of the Floor Price Notification by DGFT. It was highlighted that the appellant was unaware of the notification when renewing the LC, as it was issued the day before, requiring a license for imports below the floor price.

Imposition of redemption fine justification:
The learned DR supported the Commissioner's imposition of the redemption fine, emphasizing that the import price did not exceed the market price minus customs duty.

Ceiling and fixing of redemption fine u/s Customs Act:
Section 125 of the Customs Act specifies the ceiling for redemption fine, with the actual fine to be determined based on the case's facts and circumstances. Considering the appellant's regular importation of the item, the near-simultaneous import with the floor price order, and the Rs. 80,000 profit margin, the redemption fine was reduced to Rs. 50,000, partially allowing the appeal.