2011 (3) TMI 616 - AT - Customs

Confiscation - Notification No. 93(RE-2007) 2004-2009, dated 1-4-2008 - there is no explanation forthcoming as to how the Non-Basmati Rice was brought to CFS when it was prohibited for export and how consignment of Basmati Rice which has already been examined by the Customs officers and was to be stuffed in the presence of Customs officers, was not stuffed in the container - It has also been brought out clearly by investigating officers that the goods were identified by the authorized surveyor of CFS with the help of CHA s representative based on the details of shipping bills and job request for stuffing - in the earlier cases, the fine in lieu of confiscation had been reduced to 25% and in this case because of deliberate attempt on the part of the exporter and CHA and CFS, there is a need to consider the quantum of reduction of the redemption fine Regarding penalty - penalty imposed on CHA and CFS of Rs. 2.5 lakhs and of Rs. 1 lakhs, cannot be considered excessive. Similarly, penalty of Rs. 5 lakhs on M/s. J.G. Agro Foods also cannot be said to be excessive - Appeal is rejected

Summary

Issues:
1. Misdeclaration of goods in shipping bill leading to attempted export of prohibited Non-Basmati Rice.
2. Discrepancy between declared Basmati Rice and actual Non-Basmati Rice found in containers.
3. Allegations of deliberate attempt to export prohibited goods against exporter, CHA, and CFS.
4. Violation of prescribed procedures for stuffing containers and connivance of involved parties.
5. Imposition of redemption fine and penalties on the exporter, CHA, and CFS.

Analysis:
1. The Customs officers discovered 5 containers filled with Non-Basmati Rice labeled as "Indian Basmati Rice" at A1 Cargo, CFS, contrary to the shipping bill declaration. The goods were supposed to be Basmati Rice for export, but Non-Basmati Rice was found. Export of Non-Basmati Rice was prohibited, leading to confiscation and imposition of fines and penalties on the exporter, CHA, and CFS.

2. The appellant's advocate cited a similar case where the Tribunal reduced the redemption fine for misdeclaration of Basmati Rice to Non-Basmati Rice. However, the Revenue argued that this case involved a deliberate attempt to export prohibited goods. Investigations revealed discrepancies in the stuffing process and failure to follow prescribed procedures for container stuffing, indicating connivance among the exporter, CHA, and CFS.

3. The Tribunal found that the exporter, CHA, and CFS collaborated to stuff the containers with Non-Basmati Rice deliberately. The decision in a previous case was distinguished as the facts here indicated awareness and strategy in exporting prohibited goods. The Tribunal supported the Revenue's contention that unauthorized shipping and loading render goods liable to confiscation.

4. Considering the deliberate attempt and connivance of the exporter, CHA, and CFS, the Tribunal upheld the penalties imposed on all three entities. The penalties were deemed appropriate given the nature of the offense and the duties of the involved parties. The redemption fine was reduced from Rs. 10 lakhs to Rs. 5 lakhs due to previous cases but the appeals were otherwise rejected.

This comprehensive analysis of the judgment highlights the issues of misdeclaration, deliberate attempt to export prohibited goods, procedural violations, and the imposition of fines and penalties on the parties involved.