2008 (7) TMI 704 - AT - Customs

Summary

Issues:
1. Confiscation of rice for export and imposition of penalty under Section 114(i) of the Customs Act, 1962.
2. Correct classification of goods for export and misdeclaration.
3. Awareness of export restrictions and penalization for attempted export.

Analysis:
1. The appeal was against the confiscation of rice valued at Rs. 6.57 lakhs for export and the penalty imposed under Section 114(i) of the Customs Act, 1962. The appellants were given the option to redeem the confiscated rice by paying a fine. The original authority held the rice liable for confiscation under Section 113(d) and (i) of the Act due to misclassification and misdeclaration, as rice export was restricted from Chennai Port. The appellate order upheld the original authority's decision.

2. M/s. Siva Enterprises argued that the misclassification of rice under a machinery sub-heading was a clerical error, not a deliberate misdeclaration. They claimed ignorance of the export restriction due to a recent notification and stated that the correct classification and prohibition checks were the customs authorities' responsibility. The correct description was provided in the Shipping Bill, and there was no fraudulent intent in exporting the rice, as evidenced by the proper declaration and assessment.

3. The tribunal, after careful consideration, found in favor of the appellants. It noted that the correct goods description was provided, and any error in classification was a clerical mistake. The exporters could not be penalized for misdeclaration if the goods were correctly described. The tribunal accepted the appellants' claim of unawareness of the export restriction and deemed the attempt to export rice as a bona fide error. The Department's approval of the shut-out request further supported the appellants' position. Consequently, the tribunal set aside the impugned order, ruling it unsustainable and allowing the appeal.

This detailed analysis of the judgment highlights the key legal issues, arguments presented, and the tribunal's decision, providing a comprehensive understanding of the case.