2015 (11) TMI 1564 - AT - Customs

Quantum of redemption fine and penalty - confiscation of goods - option to redeem goods by paying redemption fine - imposition of penalties - rejection of declared value - revision of the value upwards - import of second hand photo copier machine - Held that - photo copiers, second hand, required import license which the appellants did not possess. Thus there was violation not only of the Import & Export Policy which made the goods liable to confiscation under Rule 111(d) of the Customs Act, 1962 also apart from under Section 111(m) ibid for mis-declaration of value - fine which works out to about 25% of the reassessed value and penalty which works out to about 12% of the reassessed value cannot be called unfair, arbitrary or unreasonable - appeal dismissed - decided against appellant.

Summary

Issues:
- Upward revision of declared values
- Confiscation of impugned goods
- Redemption fine and penalty imposition

Upward revision of declared values:
The appeals were filed against orders-in-original where declared values were rejected and revised upwards, resulting in the confiscation of impugned goods. The appellants imported second-hand photo copier machines, which were deemed undervalued, leading to an enhancement of declared values with the appellants' consent. The Tribunal noted that the imported photo copiers required an import license, which the appellants did not possess, violating the Import & Export Policy. This violation made the goods liable to confiscation under Rule 111(d) of the Customs Act, 1962, and under Section 111(m) for misdeclaration of value. The Tribunal found that the fine and penalty imposed, approximately 25% and 12% of the reassessed value respectively, were not unfair, arbitrary, or unreasonable given the circumstances.

Confiscation of impugned goods:
The Tribunal determined that the second-hand photo copier machines imported by the appellants were undervalued and lacked the necessary import license, leading to violations of the Import & Export Policy. Consequently, the impugned goods were ordered to be confiscated under Rule 111(d) of the Customs Act, 1962, in addition to penalties being imposed for misdeclaration of value. The Tribunal emphasized that the confiscation was justified due to the non-compliance with import regulations, reinforcing the decision to enhance the declared values.

Redemption fine and penalty imposition:
Although the appellants accepted the upward revision of values, they contested the quantum of redemption fine and penalty imposed, arguing that they were excessive given the circumstances. The Tribunal acknowledged the appellants' objection but upheld the fines and penalties, stating that they were proportionate to the reassessed values and the violations committed. The Tribunal distinguished a previous CESTAT order cited by the appellants, highlighting that in the present case, the valuation was not disputed by the appellants, unlike the case referenced. Ultimately, the Tribunal dismissed the appeals, finding no merit in the challenges raised by the appellants regarding the redemption fine and penalties.