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2008 (7) TMI 626 - AT - Customs

Issues Involved:
1. Import of Arcton 22 gas cylinders without the required license under the Montreal Protocol and Gas Cylinder Rules, 1981.
2. Confiscation of cylinders, imposition of redemption fine, and penalties on the proprietor and manager.

Issue 1: Import of Arcton 22 gas cylinders without the required license under the Montreal Protocol and Gas Cylinder Rules, 1981:
The case involved the importation of Arcton 22 gas cylinders by Kandla Ship Suppliers without the necessary license under the Montreal Protocol and Gas Cylinder Rules, 1981. The Commissioner held that the import was not permitted as UAE, the source country, had not ratified the Copenhagen Amendment adding HCFC 22 to the Montreal Protocol. The Chief Controller of Explosives clarified that a license was required for importing cylinders filled with gases for re-export or supply to foreign vessels, which Kandla Ship Suppliers did not possess. The Commissioner confiscated the cylinders due to non-compliance with licensing requirements.

Issue 2: Confiscation of cylinders, imposition of redemption fine, and penalties on the proprietor and manager:
Following show cause notice and adjudication proceedings, the Commissioner confiscated the cylinders and imposed a redemption fine of Rs. 5 lakhs. Additionally, penalties of Rs. 3 lakhs on the proprietor and Rs. 2 lakhs on the manager were imposed. The appellant argued that UAE was a party to the protocol, no license was required for possession of less than 200 cylinders, and they had imported similar consignments without objections before. The Commissioner's decision was based on the lack of license for the consignments exceeding 200 cylinders and the need for compliance with regulations. The Tribunal acknowledged the appellant's belief but emphasized the need for evidence of compliance with cylinder possession limits. The penalties were reduced to Rs. 1 lakh for fine, Rs. 75,000 for the proprietor, and Rs. 50,000 for the manager, considering the circumstances and prior business conduct.

In conclusion, the judgment highlighted the importance of adhering to licensing requirements under international protocols and domestic regulations for importing controlled substances like Arcton 22 gas cylinders. While acknowledging the appellant's belief and business practices, the Tribunal emphasized the need for evidence and compliance to avoid penalties and confiscation. The decision ultimately reduced the fines and penalties imposed, considering the circumstances and previous conduct of the parties involved.

 

 

 

 

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