2008 (6) TMI 431 - AT - Customs

Summary

Issues:
1. Confiscation of goods under Section 113 of the Customs Act and imposition of penalty under Section 114.
2. Classification of goods as "Semi-Finished Cow Upper Nappa Leather" instead of "Finished Cow Upper Nappa Leather."
3. Expert opinion from CLRI regarding the goods not meeting the norms for "finished leather."
4. Lack of registration with the Council for Leather Exports for exporting unfinished leather.
5. Discrepancy between the appellant and the Revenue on the classification of the goods.
6. Consideration of fine and penalty amounts by the adjudicating authority.

Analysis:

1. The appeal challenged the Commissioner's decision to confiscate the goods under Section 113 of the Customs Act and impose a penalty under Section 114. The appellants had declared the goods as "Finished Cow Upper Nappa Leather" for export, but upon examination, they were found to be "Semi-Finished Cow Upper Nappa Leather." The Customs authorities relied on a report from CLRI stating that the goods did not meet the requirements for "finished leather" as declared, leading to the confiscation of the goods.

2. The appellant's counsel argued that a previous tribunal decision had condoned similar deficiencies in a case involving the absence of a protective coat on leather declared as "finished leather." However, in the present case, there was no agreement between the parties, and the goods were presented for export without the necessary registration with the Council for Leather Exports for exporting unfinished leather, justifying the confiscation under Section 113.

3. Despite the expert opinion from CLRI confirming the goods as "unfinished leather," the appellants expressed willingness to take back the goods upon learning of this assessment. The Tribunal considered this and reduced the fine amount to Rs. 50,000, deeming any higher fine as excessive given the circumstances. The penalty imposed under Section 114 was set aside, noting that the cumulative imposition under different clauses was not appropriate, and the appellants deserved compassionate treatment.

4. The Tribunal ultimately disposed of the appeal by adjusting the fine amount and setting aside the penalty, taking into account the expert opinion, lack of registration, and the willingness of the appellants to rectify the situation by taking back the goods.