2008 (4) TMI 568 - AT - Customs

Smuggling - Redemption fine and penalty - Held that - by concealing the gold coins without declaring to the Customs authorities, Shri Ramaraj was attempting to evade payment of duty on the goods. In other words, ulterior motive of the appellant is writ large on the facts of this case. No one with a judicial mind can stand in the way of confiscation being ordered of the gold coins under Section 111 or penalty being imposed on the importer under Section 112 of the Act. The same is true in respect of the foreign currency and the mobile phones which were concealed by the appellant. Quantum of redemption fine and penalty is on higher side and is reduced - appeal allowed in part.

Issues: Smuggling of gold coins, foreign currency, and mobile phones; Confiscation under Customs Act; Redemption fine and penalty imposition; Eligibility for concessional rate of duty; Reasonableness of fine and penalty.

Smuggling of Gold Coins, Foreign Currency, and Mobile Phones:
The case involved the interception of a passenger at Chennai Airport who concealed 307 gold coins, foreign currency, and mobile phones in his baggage. The passenger declared only 50 Euros initially, but upon detailed examination, the hidden items were discovered. The passenger admitted to the offense, leading to the seizure of the goods under a mahazar. Further investigations and representations were made by the passenger and his wife, with subsequent legal proceedings.

Confiscation under Customs Act:
The Commissioner ordered the confiscation of the gold coins, foreign currency, mobile phones, and other items under various sections of the Customs Act. The Commissioner provided an option for redemption of the confiscated items upon payment of fines. The appellant challenged the fines and penalties imposed, arguing against the excessive amounts based on the circumstances of the case.

Redemption Fine and Penalty Imposition:
The appellant contested the fines and penalties imposed by the Commissioner, particularly highlighting the eligibility of the passenger for a concessional rate of duty under a specific notification. The High Court's order regarding the passenger's eligibility played a crucial role in determining the legitimacy of the fines and penalties imposed. The adjudicating authority found the passenger's concealment of goods as an attempt to evade duty payment, justifying the confiscation and penalties.

Eligibility for Concessional Rate of Duty:
The issue of the passenger's eligibility for a concessional rate of duty under a specific notification was a significant point of contention. The High Court's ruling on the passenger being an "eligible passenger" influenced the decision on the fines and penalties imposed by the Commissioner. The concealment of goods by the passenger without declaring them to Customs authorities was viewed as an attempt to avoid duty payment, affecting the application of the notification.

Reasonableness of Fine and Penalty:
After thorough consideration of the facts and circumstances, the Appellate Tribunal deemed the fines and penalties imposed by the Commissioner as excessive. The Tribunal reduced the fines significantly, considering the value of the confiscated items and the circumstances of the case. The Tribunal found the initial fines and penalties to be on the higher side and adjusted them to more reasonable amounts based on the specific details of the case.

In conclusion, the Appellate Tribunal modified the impugned order, reducing the fines and penalties imposed by the Commissioner to more reasonable amounts. The appeal was disposed of after a detailed analysis of the smuggling case, confiscation under the Customs Act, redemption fines, eligibility for concessional rate of duty, and the reasonableness of fines and penalties in the context of the specific circumstances of the case.

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