1983 (2) TMI 302 - AT - Customs

Summary

Issues:
1. Confiscation of imported old and used woollen garments.
2. Validity of import and intention of sale.
3. Failure to produce proof of valid import.
4. Applicability of Customs Act provisions.
5. Burden of proof on department.
6. Release of goods subject to mutilation.

Analysis:

The case involved the confiscation of imported old and used woollen garments intercepted by the Central Excise staff, leading to subsequent adjudicating proceedings. The Deputy Collector confiscated the goods under Sec. 111 (d) of the Customs Act, 1962, citing violation of Customs law, but allowed redemption on payment of a fine and imposed a penalty. The appeal against this order was rejected by the Appellate Collector, emphasizing the failure to produce proof of valid import and the description of the goods as mutilated woollen rags not intended for sale. The appellant contended that the purchase of rags was for bonafide consumption in manufacturing shoddy yarn, highlighting the absence of evidence of sale in violation of Customs law and the lawful import of goods. The appellant argued against the confiscation, citing discrimination in similar cases and the release of goods upon mutilation.

The Tribunal observed that the burden of proving the goods were imported in violation of any restriction or prohibition rested on the department. The evidence of lawful import provided by the appellant should have been rebutted by the department, especially considering the failure of the named importer to respond to the show cause notice. The Tribunal referred to previous cases where release of similar goods was allowed upon verification of import transactions and the logic of the Nagesh Hosiery Mills judgment was followed. Noting the acceptance of similar appeals by the Board, the Tribunal accepted the appellant's pleas, setting aside the order of confiscation and penalty. The goods were to be released to the appellant under the condition of mutilation for rendering them unserviceable for use in shoddy yarn manufacturing, under Customs or Central Excise supervision.