2010 (9) TMI 414 - AT - Customs

Confiscation Misdeclaration - bona fide mistake and the appellant themselves approached the Revenue for amendment in the IGM - declaration of the fridge, deep freezer, washing machine, electric iron etc. as electrical appliances amounts to misdeclaration on the part of the assessee - goods were to be supplied as ship stores to the foreign going vessels and were not meant for DTA clearances - failure on the part of the assessee to declare each and every item separately, instead of declaring the entire goods as electrical appliances cannot amount to any misdeclaration on their part so as to invite confiscation - no merits in the Commissioner s order confiscating the goods and extending an option to the appellant to pay redemption fine order set aside

Summary

Issues:
1. Confiscation of goods due to alleged misdeclaration.
2. Confiscation of Freon gas cylinders.
3. Confiscation of goods outside the bonded warehouse.
4. Demand of duty and penalty for shortages and excesses.
5. Imposition of penalty under Section 112(a) of the Customs Act.

Confiscation of Goods due to Alleged Misdeclaration:
The appellant, a proprietary concern with a private bonded warehouse, imported goods as "ship stores" for foreign vessels. An amendment to the IGM was requested due to a mistake in the container stuffing. The Commissioner accepted the appellant's explanation, ruling out fraudulent intention. However, certain items like fridge and washing machine were confiscated as they were not adequately declared. The Tribunal disagreed, stating that the goods were meant for foreign vessels and not DTA clearances, thus misdeclaration was unfounded. Confiscation was set aside.

Confiscation of Freon Gas Cylinders:
The Commissioner confiscated Freon gas cylinders due to lack of a license at the time of import, despite a subsequent provisional license obtained. The Tribunal held that subsequent fulfillment of import conditions should be accepted, and the confiscation was unjustified. The confiscation was set aside.

Confiscation of Goods Outside the Bonded Warehouse:
Goods outside the bonded warehouse were confiscated by the Commissioner, alleging they were not part of the warehouse. The Tribunal found no evidence of intent to remove goods clandestinely, as the premises were sealed and under customs control. Confiscation was deemed unjustified and set aside.

Demand of Duty and Penalty for Shortages and Excesses:
Allegations of shortages and excesses were made, with the appellant accepting discrepancies during verification. The Tribunal upheld the duty demand and penalty, as the appellant failed to provide a convincing explanation for the discrepancies.

Imposition of Penalty under Section 112(a) of the Customs Act:
The Commissioner imposed a penalty under Section 112(a) of the Customs Act, which the Tribunal deemed unjustified. As the Tribunal ruled in favor of the appellant on other counts, the penalty was set aside.

In summary, the Tribunal set aside most confiscations and penalties, except for duty demand and penalty for shortages and excesses. The judgment highlighted the importance of proper declaration, subsequent fulfillment of import conditions, and the necessity of evidence to support confiscation decisions.