2007 (6) TMI 453 - AT - Customs

Summary

Issues Involved:
1. Ownership of the imported car.
2. Absolute confiscation of the car without redemption option.
3. Notice and procedural fairness in the confiscation and auction process.
4. Imposition of penalty on the appellant.
5. Applicability of Section 23(2) and Section 125 of the Customs Act, 1962.

Issue-wise Detailed Analysis:

1. Ownership of the Imported Car:
The appellant filed the Bill of Entry for the import of the car, which prima facie indicates ownership under Section 2(26) of the Customs Act, 1962. However, the appellant admitted under Section 108 that he had no connection with the car and had merely lent his passport to a friend for the import. The Tribunal concluded that the appellant could not be considered the owner or importer based on his own admissions.

2. Absolute Confiscation of the Car Without Redemption Option:
The car was confiscated absolutely under Section 111(d) of the Customs Act, 1962, read with Section 3(3) of the Foreign Trade (Development & Regulation) Act, 1992, due to violations of the Import Policy. The appellant argued that he should have been given the option to redeem the car under Section 125 of the Customs Act. However, the Tribunal upheld the absolute confiscation, stating that the appellant had no legitimate claim to the car and had abandoned it.

3. Notice and Procedural Fairness in the Confiscation and Auction Process:
The appellant contended that he was not given notice of the car's auction and sale, violating Section 48 of the Customs Act. The Tribunal found that since the appellant had abandoned the car and had no legitimate claim, he was not entitled to notice. The Tribunal emphasized that the law does not favor individuals who facilitate fraudulent activities.

4. Imposition of Penalty on the Appellant:
A penalty of Rs. 2.5 lakhs was imposed on the appellant under Section 112(a) of the Customs Act for lending his passport and making false declarations. The Tribunal justified the penalty, citing the appellant's involvement in facilitating the illegal import. However, considering the circumstances, the penalty was reduced to Rs. 10,000.

5. Applicability of Section 23(2) and Section 125 of the Customs Act, 1962:
The appellant referred to the proviso to Section 23(2), which prevents relinquishing title to goods involved in an offense. The Tribunal ruled that this proviso was inapplicable because the appellant had no legitimate ownership of the car. The Tribunal also dismissed the applicability of Section 125 for redemption, as the appellant was not a legitimate claimant.

Conclusion:
The Tribunal upheld the absolute confiscation of the car and justified the imposition of the penalty, albeit reducing it to Rs. 10,000. The appellant's claims regarding ownership, notice, and procedural fairness were dismissed based on his own admissions and the legal provisions governing the case.