2006 (2) TMI 515 - AT - Central Excise

Summary

Issues:
1. Concessional rate of duty claim on imported crude palm oil.
2. Mis-declaration and confiscation of non-edible grade crude palm oil.
3. Imposition of fines, penalties, and differential duty on the appellants.

Analysis:
1. The appellants, M/s. Kedia Overseas Limited and M/s. Foods, Fats and Fertilizers Limited, imported crude palm oil and claimed a concessional rate of duty under a specific notification. The Port Health Officer initially confirmed that the oil met standards but later, test results showed otherwise. The Commissioner ordered confiscation of a portion of the imported oil and imposed fines and penalties on the appellants. The appellants sought re-export due to the non-compliance with standards.

2. The Commissioner's orders involved confiscation of non-edible grade crude palm oil from both appellants under relevant sections of the Customs Act. However, considering the circumstances where the appellants acted in good faith by arranging re-export upon learning of the non-compliance, the appellate tribunal found no willful mis-declaration. The tribunal noted that the appellants provided necessary documents based on the information available at the time of import.

3. The learned advocate for the appellants argued against the fines and penalties imposed, emphasizing the lack of intentional wrongdoing on their part. The tribunal concurred, stating that the appellants' actions to rectify the situation by preparing for re-export upon discovering the discrepancy in quality demonstrated their good faith. The tribunal upheld the liability to pay differential duty on the portion of oil already cleared but allowed re-export without additional fines or penalties, acknowledging the appellants' genuine intentions.

In conclusion, the appellate tribunal ruled in favor of the appellants, allowing re-export without further financial penalties due to the absence of intentional mis-declaration and the appellants' prompt actions to address the quality issue upon discovery.