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Issues involved: Appeal against impugned order passed by Commissioner of Customs regarding import of Heavy Metal scrap without pre-shipment inspection certificate and imposition of redemption fine and penalty.
Issue 1: Confiscation of goods due to lack of pre-shipment inspection certificate The appellants imported 396.68 MT of Heavy Metal scrap and filed Bill of Entry on 23-12-2004. Customs authorities claimed that 4 MT of the consignment was Re-rollable scrap of steel and iron, requiring a pre-shipment inspection certificate as per EXIM policy. The adjudicating authority imposed a redemption fine of Rs. 4,25,000/- and a penalty of Rs. 2,25,000/- due to non-compliance. Appellants' Contention: The appellants argued that the entire consignment being 396.68 MT, with only 4 MT being re-rollable scrap, should not lead to confiscation. They claimed to be actual users requiring all scrap for melting purposes. They highlighted that the pre-shipment inspection condition was introduced after the goods were shipped, making confiscation on this ground unjustified. Revenue's Contention: The Revenue asserted that the re-rollable scrap held higher value and could be used for re-rolling, justifying the impugned order. They argued that the pre-shipment inspection requirement was crucial due to the possibility of unexploded ammunition in scrap coming from Iraq, thus supporting the confiscation. Decision: The Tribunal found that the small quantity of re-rollable scrap in the consignment, despite its potential value, should not render the entire shipment liable for confiscation. Additionally, as the goods were shipped before the pre-shipment inspection condition was imposed, the confiscation on this ground was deemed unsustainable. Consequently, the impugned order was set aside, and the appeal was allowed. Final Decision: The Tribunal set aside the impugned order passed by the Commissioner of Customs, ruling in favor of the appellants due to the lack of justification for confiscation based on the presence of a small quantity of re-rollable scrap and the timing of the pre-shipment inspection requirement.
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