1983 (1) TMI 272 - AT - Customs

Summary

Issues:
1. Application for stay filed by M/s. National Harbour Launch Service in connection with their appeal against the order of the Additional Collector of Customs.
2. Whether the Tribunal has the legal authority to grant stay against the recovery of fine in lieu of confiscation under the Customs Act.

Analysis:

Issue 1: The application for stay was filed by M/s. National Harbour Launch Service in relation to their appeal against the order of the Additional Collector of Customs, which confiscated their launch valued at Rs. 40,000 under Sec. 115(2) of the Customs Act. The appellants executed a bond with a bank guarantee for Rs. 30,000, as the launch was released before the order of confiscation was issued. The Customs authorities sought to recover the Rs. 30,000 from the guarantor, prompting the appellants to file for stay of the recovery. The appellants proposed various undertakings to secure the amount, including not disposing of the motor launch and depositing its registration certificate with the Tribunal or Customs authorities. However, the Tribunal pointed out that stay could only be applied against payment of duty or penalty under Sec. 129-E of the Customs Act.

Issue 2: The departmental representative opposed the stay, arguing that the Customs Act does not provide for stay of the fine levied, and the rules cannot override the Act. The adjudicating authority had confiscated the launch under Sec. 115(2) of the Customs Act, offering the appellants the option to redeem it by paying a fine of Rs. 30,000. The Tribunal concurred with the department's view, stating that the Act specifically allows stay of penalty or duty, not fine in lieu of confiscation. As per Sec. 126 of the Customs Act, the property in the confiscated launch vests in the Central Government, and the Collector of Customs is mandated to take possession. Consequently, the Tribunal found no provisions in the Customs Act permitting them to grant a stay against the recovery of the redemption fine. Thus, the appellants' request for stay was rejected.

In conclusion, the Tribunal held that the appellants' request for stay against the recovery of the redemption fine could not be granted as the Customs Act did not provide for such a stay. The Tribunal emphasized that the rules cannot override the Act, and in this case, the Act specifically allowed stay only for duty or penalty, not for a fine in lieu of confiscation.