2011 (8) TMI 1065 - AT - Customs

Summary

Issues Involved:
1. Confiscation of imported used multi-functional copiers.
2. Imposition of redemption fines and penalties.
3. Jurisdiction of the original authority.
4. Applicability of the Exim Policy to the imported goods.
5. Reduction of redemption fines and penalties by the Commissioner (Appeals).
6. Enhancement of redemption fines and penalties by the department.

Detailed Analysis:

1. Confiscation of Imported Used Multi-Functional Copiers:
The assessees imported used multi-functional copiers classified under 8443 31 00. These consignments were examined by approved chartered engineers, and the values were enhanced based on their certificates. The appellants accepted the classification, enhanced value, and paid duty without dispute. However, the department held that these items were restricted and violated the Exim Policy due to the lack of requisite licenses. Consequently, the original authority confiscated the consignments, allowing redemption on payment of fines and imposing penalties. The Commissioner (Appeals) upheld the confiscation and duty liability but reduced fines and penalties in some cases.

2. Imposition of Redemption Fines and Penalties:
The department sought to enhance the redemption fines and penalties to the levels imposed by the original authority. The learned advocate for the importers argued that the fines and penalties were arbitrary and not based on market enquiry. He cited several decisions where lower fines and penalties were upheld, emphasizing that the imposed fines exceeded the benchmark rate of 10% for redemption fines and 5% for penalties.

3. Jurisdiction of the Original Authority:
The issue of jurisdiction was raised for the first time before the Tribunal. The importers argued that the imported goods did not require a license, referencing the Tribunal's decision in M/s. Shivam International. However, the Tribunal found that the imported items in the present case were different from those in Shivam International, and the claim that the consignments did not require a license was weak. The Tribunal concluded that the authorities did not exceed their jurisdiction and that the importers had submitted to the jurisdiction of the original authority and Commissioner (Appeals).

4. Applicability of the Exim Policy to the Imported Goods:
The Tribunal held that the imported photocopiers with additional facilities were rightly confiscated as they were imported without the requisite licenses under the Exim Policy. The original authority's confiscation orders were upheld by the Commissioner (Appeals), and the Tribunal found no reason to interfere with these orders.

5. Reduction of Redemption Fines and Penalties by the Commissioner (Appeals):
The learned advocate sought further reductions in fines and penalties, citing several decisions where lower fines were sustained. The Tribunal noted that the quantum of redemption fines depends on the facts and circumstances of each case, subject to statutory limits under Section 125 of the Customs Act. The Tribunal found that the redemption fines were not imposed arbitrarily and were based on valuations by approved chartered engineers. However, considering the facts and circumstances, the Tribunal decided to reduce the fines and penalties for certain appellants.

6. Enhancement of Redemption Fines and Penalties by the Department:
The department's appeals for enhancing fines and penalties were rejected. The Commissioner (Appeals) had exercised discretion in reducing fines based on the facts and circumstances, and there was no evidence of arbitrary or mechanical exercise of power. The Tribunal upheld the reductions made by the Commissioner (Appeals) and rejected the department's appeals.

Conclusion:
The Tribunal disposed of the appeals by reducing the redemption fines and penalties for certain appellants while upholding the confiscation orders. The department's appeals for enhancement of fines and penalties were rejected. The Tribunal emphasized the importance of discretion in imposing fines and penalties, considering the facts and circumstances of each case.