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Issues involved: Import of capital goods under EPCG scheme, failure to fulfill export obligation, demand of duty, confiscation under Section 111(o) of the Customs Act, imposition of fine and penalty, adjustment of payments made.
Summary: The appeal was filed against an order passed by the Commissioner of Customs, Bangalore, regarding the import of capital goods under EPCG Licenses and failure to fulfill export obligations. The Commissioner held the goods liable for confiscation under Section 111(o) of the Customs Act, imposed a redemption fine, confirmed duty demand, and imposed a penalty. The appellants challenged the order on various grounds. The appellants argued that they had partially fulfilled the export obligation under one EPCG License, citing global market recession as the reason for not meeting obligations. They contended that confiscation, fine, and penalty were not justified. The appellants also raised concerns about the imposition and enhancement of penalties. Upon careful review, the Tribunal found that while the differential duty demand was valid due to non-fulfillment of export obligations, confiscation under Section 111(o) was not justified. Considering the financial impact of global recession on the appellants, the Tribunal set aside the order of confiscation, fine, and penalty. Regarding the adjustment of payments made by the appellants, the Tribunal directed the Adjudicating Authority to scrutinize the evidence and adjust the payments towards the duty demanded. Any unreconciled amount was to be paid by the appellants within three months. The appeal was allowed for the purpose of adjusting the duty demand from the payments already made. In conclusion, the Tribunal ruled in favor of the appellants, setting aside the confiscation order and directing the adjustment of payments towards the duty demand within a specified timeframe.
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