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2010 (9) TMI 626 - AT - CustomsRedemption fines and penalties - whether the lower appellate authority was justified in reducing the redemption fine and penalty to a lower level of 15% and 5% (total 20%) uniformly in all these cases thereby interfering with the discretionary power exercised by the original authorities - It is clear that the fixation of the quantum of redemption fine and penalty can only be interfered if the same is fixed in an arbitrary and whimsical manner resulting in miscarriage of justice - It is clear that the petitioners who are in the business of marble and have become a habitual importer of goods in spite of the fact that they are very well aware of the law that the imports have to be backed by a valid licence - The importers who are importing goods without licence and then seek to validate the import by obtaining subsequent licence or licences cannot be allowed to take advantage of their own wrong - the fine and penalty at some what higher levels (together ranging from about 30% to about 55%) imposed in these cases are not at all excessive as the respondents have found it still profitable to clear the goods on payment of the fines and penalties levied and have only subsequently filed appeals before the lower appellate authority - Appeals are allowed
Issues Involved:
1. Withdrawal of appeals by appellant-importers. 2. Department's challenge to the reduction of redemption fines and penalties by the lower appellate authority. Issue-wise Detailed Analysis: 1. Withdrawal of Appeals by Appellant-Importers: The judgment notes that two appeals (Appeal Nos. C/78/2010 and C/80/2010) were withdrawn by the appellant-importers. The learned counsel for the appellants, Shri A.K. Jayaraj, sought permission to withdraw these appeals through a letter dated 21-9-2010. The tribunal granted the request, and these two appeals were dismissed as withdrawn. 2. Department's Challenge to Reduction of Redemption Fines and Penalties: The remaining seven appeals were filed by the Department challenging the orders of the lower appellate authority, which had reduced the redemption fines and penalties imposed by the original authorities. The original authorities had enhanced the value of the consignments and confiscated the goods due to violations of the Import Policy and the absence of valid import licenses. The lower appellate authority had reduced the fines and penalties to 15% and 5% of the assessed values, respectively. The Department argued that higher fines and penalties were warranted for repeated undervalued imports in violation of the Import Policy. They emphasized that the respondents were habitual offenders, and the lower appellate authority's reliance on the Hon'ble Madras High Court's decision in the case of Sai Copiers (2008 (226) E.L.T. 486 (Mad.)) was misplaced. The Department cited several decisions, including Jain Exports Pvt. Ltd. v. Union of India (1993 (66) E.L.T. 537 (S.C.)), Sophisticated Marble & Granite Industries v. Commissioner of Customs, Mumbai (2004 (165) E.L.T. 353 (Tri. - Mumbai)), and Commissioner of Customs, Mumbai v. Vaibhav Exports (2009 (244) E.L.T. 527 (Bom.)), to support their contention that higher fines and penalties are justified in cases of repeated offences. The tribunal found that the lower appellate authority's decision to reduce the fines and penalties uniformly to 15% and 5% was not justified. The tribunal noted that despite previous fines and penalties, large-scale imports of undervalued goods without necessary licenses continued. The tribunal also highlighted that the cited decision of the Hon'ble Madras High Court in the case of Sai Copiers did not authorize the imposition of low fines and penalties for repeated offences. The tribunal emphasized that the higher courts have always taken a stricter view in respect of habitual offenders. For example, in the case of Sophisticated Marbles, the Hon'ble Bombay High Court had upheld higher fines and penalties for repeated offences. Similarly, in the case of Vaibhav Exports, the Hon'ble Bombay High Court had authorized a redemption fine equal to 20% of the value of the imported diamonds to ensure that importers do not find it profitable to import without proper licenses. The tribunal concluded that the fines and penalties imposed by the original authorities were not unreasonable, arbitrary, or whimsical. The authorities have a duty to prevent illegal imports and effectively implement the Import Policy. The lower appellate authority's reduction of fines and penalties to 20% was unjustified. Therefore, the tribunal set aside the impugned orders of the lower appellate authority and restored the orders of the original authorities. All seven departmental appeals were allowed. Conclusion: - Appeal Nos. C/78/2010 and C/80/2010 were dismissed as withdrawn. - The seven departmental appeals (Appeal Nos. C/70 & 71, 73 to 77/2010) were allowed, and the original orders imposing higher fines and penalties were restored.
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