2016 (2) TMI 981 - AT - Customs

Detention of consignment - the weight of the consignment was shown as 109.010 MTs of heavy melting scrap whereas it was found as 124.820 MTs - Held that - on examination, part of the consignment was found re-rollable scrap but the appellant has placed an order for supply of heavy melting scrap and the certificate of origin also certifies the same. The appellant has actually used the said goods as heavy melting scrap. Without any contrary evidence on record, I hold that goods are not liable for confiscation on this ground. Charge of mis-declaration of weight - Held that - I find that as during the examination goods were found in excess to the declared weight, therefore, the goods are rightly held liable for confiscation by the lower authorities. Therefore, I do agree with the impugned order that on account of excess weight, the goods are liable for confiscation. As the goods impugned are not restricted goods therefore, they can be released on payment of redemption fine and penalty. Further, I find that the redemption fine and penalty imposed on the appellant highly excessive and the goods cannot be held liable for confiscation on the charge of misdeclaration of description, I reduce the redemption fine to ₹ 20,000/- and penalty to ₹ 10,000/- - appeal disposed off.

Summary

Issues:
Appeal against imposition of redemption fine and penalty.

Analysis:
1. The case involved an appeal against an order imposing redemption fine and penalty on the appellant for importing a consignment declared as heavy melting scrap, which was later found to contain re-rollable scrap as well. The weight of the consignment was also inaccurately declared, leading to detention and adjudication by the authorities. The appellant paid duty on the enhanced value and actual weight of the goods. The adjudicating authority held the goods liable for confiscation but allowed redemption on payment of fine and penalty, a decision upheld by the Commissioner (A) and challenged in the present appeal.

2. The appellant argued that they ordered heavy melting scrap, used it in their furnace, and had a certificate of origin confirming the goods as heavy melting scrap. They claimed the supplier's mistake led to the incorrect weight declaration, denying any intent to misdeclare. The appellant contended that redemption fine and penalty should not apply in such circumstances.

3. The respondent reiterated the findings of the impugned order, supporting the imposition of redemption fine and penalty.

4. After hearing both parties and considering their submissions, the tribunal proceeded with its analysis.

5. The tribunal found that despite part of the consignment being re-rollable scrap, the appellant ordered heavy melting scrap, used it as such, and had documentation supporting this. As no contrary evidence existed, the goods were deemed not liable for confiscation on this ground. However, due to the misdeclaration of weight, where goods were found in excess of the declared weight during examination, the tribunal agreed with the lower authorities that confiscation was justified. Since the goods were not restricted, they could be released upon payment of redemption fine and penalty. The tribunal deemed the initially imposed fine and penalty excessive, reducing them to more reasonable amounts due to the lack of liability for confiscation based on misdeclaration of description.

6. Consequently, the tribunal disposed of the appeal with the above observations.