2009 (12) TMI 922 - AT - Customs

Quantum of redemption fine and penalty - Revenue s contention is that the margin of profit is 20 per cent to 22 per cent and thus, the redemption fine and penalty, are on the lower side - Held that - the value was enhanced by the Department based on Chartered Engineer s Certificate. The Commissioner (Appeals) relied upon the Tribunal s decision in the case of Navpad Enterprises and Ors. 2008 (3) TMI 604 - CESTAT, BANGALORE by which redemption fine and penalty of 10 per cent and 5 per cent, respectively were imposed - appeal dismissed - decided against Revenue.

Summary

Issues involved:
1. Appeal against reduction of redemption fine and penalty
2. Contention regarding profit margin and enhancement of value
3. Application of precedent in determining redemption fine and penalty

Analysis:
The Appeals before the Appellate Tribunal CESTAT Kolkata involved a common issue, leading to a consolidated Order. The Revenue appealed against the Commissioner (Appeals)' Order, which had reduced the redemption fine and penalty to 10% and 5%, respectively. The Revenue argued that the profit margin being 20% to 22%, the fine and penalty were low and should be increased. On the other hand, the Respondents contended that the value was enhanced by the Revenue, which they accepted. The Commissioner (Appeals) based the decision on precedents like the case of Navpad Enterprises, where a similar fine and penalty were imposed. The Respondents highlighted that the Revenue's appeal in a similar case was dismissed by the Kerala High Court, supporting the Commissioner's decision.

Upon review, the Member (Technical) found that the Department had increased the value based on a Chartered Engineer's Certificate. The Commissioner (Appeals) had followed the precedent set by the Tribunal in the Navpad Enterprises case, where a 10% redemption fine and 5% penalty were imposed. This decision was upheld by the Kerala High Court, emphasizing the importance of consistency in applying legal precedents. The Member noted that the uniform application of redemption fines was crucial for fairness and non-discrimination. The Tribunal's Single Member Bench had also supported the Commissioner's decision in a related case, further reinforcing the consistency in applying redemption fines.

In conclusion, the Member saw no reason to deviate from the established precedents and decisions. Therefore, the Appeals were dismissed, affirming the reduction of the redemption fine and penalty by the Commissioner (Appeals) based on the consistent application of legal principles and precedents.