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2010 (12) TMI 1028 - AT - CustomsPenalty - prohibited goods - goods imported without IEC Number - confiscation under Section 111 sub-clause (d) of the Customs Act, 1962 - Held that - If it is the case of the Revenue that the goods imported by the respondents herein were prohibited goods due to non-availability of IEC number and would in turn be liable for confiscation under Section 111(d) of the Customs Act, 1962, Revenue should have issued a show-cause notice under Section 124 of the Customs Act, 1962 proposing to confiscate the goods and for consequent actions like redemption fine and/or for imposition of penalty. In the absence of any such proposition, the Commissioner (Appeals) was correct in coming to the conclusion that there is no contravention of Section 111(d) of the Customs Act, 1962. The appeal filed by the Revenue is rejected.
Issues:
Violation of provisions of Section 7 of Foreign Trade (Development & Regulation) Act, 1992 regarding Importer-Exporter Code (IEC) Number. Analysis: The appeal filed by the Revenue was against the Order-in-Appeal No. 53/2008(H-II)[D]-Cus., dated 31-10-2008, concerning the importation of goods without a valid Importer-Exporter Code (IEC) Number. The Department argued that goods imported without an IEC Number fall under prohibited goods, making them liable for confiscation under Section 111(d) of the Customs Act, 1962, with penalties under Section 112. The Commissioner (Appeals) rejected the department's appeal, stating that the provisions of Section 111 were not applicable in this case. The Revenue contended that the goods, imported without an IEC Code, should be confiscated under Section 111(d) of the Customs Act, as per legal precedents. The Order-in-Original mentioned the absence of a valid IEC as the basis for imposing penalties under Section 117 of the Customs Act, 1962. The Commissioner (Appeals) noted the lack of details in the impugned order regarding the goods imported, emphasizing that importation without an IEC does not ipso facto make the goods prohibited. He highlighted the necessity of fulfilling conditions before confiscation under Section 111(d) and the requirement for show-cause notices under Section 124 for confiscation or penalties. The Commissioner (Appeals) upheld the impugned orders, ruling that no contravention of Section 111(d) was established due to the absence of show-cause notices, leading to the rejection of the Revenue's appeal. This comprehensive analysis delves into the core issue of the violation of Section 7 of the Foreign Trade (Development & Regulation) Act, 1992 concerning the requirement of an Importer-Exporter Code (IEC) Number for imported goods. The judgment highlights the legal arguments presented by both parties, focusing on the interpretation of provisions under the Customs Act, 1962, regarding the confiscation and penalties associated with goods imported without a valid IEC. The Commissioner (Appeals) emphasized the need for specific conditions to be met before confiscation under Section 111(d) could be considered, emphasizing the importance of show-cause notices under Section 124 for imposing penalties or confiscation. Ultimately, the Tribunal upheld the Commissioner (Appeals) decision, emphasizing the legal requirements and procedural aspects that must be followed in cases involving the importation of goods without the necessary documentation, such as the IEC Code.
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