2007 (1) TMI 326 - AT - Customs

Summary

Issues: Mis-declaration of goods description for duty exemption, confiscation of goods, imposition of redemption fine and penalty, clearance under EPCG scheme

Mis-declaration of goods description for duty exemption:
The appellants imported industrial sewing machines and claimed duty exemption under Customs and Central Excise Notifications. The assessing authority discovered that the machines were 'with inbuilt motor' contrary to the declaration of 'without inbuilt motor'. The Commissioner rejected duty exemption, confiscated the goods under Section 111(m) of the Customs Act, and imposed a redemption fine and penalty under Section 112(a) of the Act. The appellants argued it was a mistake by their CHA and requested clearance under the EPCG scheme. The Tribunal found that the appellants knowingly misdeclared the goods to evade duty payment, sustaining the confiscation but reducing the redemption fine and penalty due to excessive imposition.

Confiscation of goods and imposition of redemption fine and penalty:
The Commissioner ordered the confiscation of the imported sewing machines due to misdeclaration under Section 111(m) of the Customs Act. Additionally, a redemption fine of Rs. 15 lakhs and a penalty of Rs. 1.5 lakhs were imposed under Section 125 and Section 112(a) of the Act, respectively. The Tribunal upheld the confiscation but reduced the redemption fine to Rs. 10 lakhs and the penalty to Rs. 1 lakh, considering the circumstances of the case. The appellants were allowed to clear the goods under the EPCG scheme upon payment of the revised fine and penalty.

Clearance under EPCG scheme:
The appellants sought clearance of the goods under the EPCG scheme after the misdeclaration issue surfaced. The Tribunal noted that the appellants' actions indicated an intent to evade duty payment by claiming exemption under false pretenses. The Tribunal reduced the redemption fine and penalty but upheld the confiscation of goods. The appellants were permitted to clear the goods under the EPCG scheme upon payment of the revised fine and penalty, as approved by the Commissioner.

This detailed analysis of the legal judgment highlights the misdeclaration issue, confiscation of goods, imposition of redemption fine and penalty, and the possibility of clearance under the EPCG scheme, providing a comprehensive overview of the case and its resolution by the Tribunal.