2014 (1) TMI 276 - HC - Customs

Barges were sold without debonding and without permission by proper officer - confiscation of the barges Imposition of redemption fine - Held that - barges are a cause of environmental issues, likely to be scrapped by the Gujarat Board Yard Works and are not covered by Insurance, it becomes necessary to consider this application. The impugned order does hold that there is no dispute that the owner M/s. DOSA had sold the barges. The impugned order of the Tribunal allows redemption of the barges by M/s. DOSA. However, M/s. DOSA are not coming forward as they have sold the Barges and now have no interest in them. In the circumstances, if the barges are not allowed to be redeemed, the same would not be available either to the appellant or the respondent as the Gujarat Board Yard Works would scrap the same. The interest of respondent is being protected inasmuch as the applicants are paying the entire redemption fine in respect of the said barges as well as the duty on the barges. It is made clear that in case the applicant fails in their appeal, they would not seek refund of the redemption fine and duty paid by them. The granting of this relief becomes necessary as the respondent has not taken charge of the barges and allowed it to remain with the applicants even after confiscation - upon the applicant paying the redemption fine and the applicable duties, the Commissioner of Customs (Imports) will allow the clearance of the four barges - Decided in favour of assessee.

Summary

Issues:
1. Imposition of penalty and confiscation of four barges by the Tribunal.
2. Challenge to the confiscation and denial of redemption option.
3. Permission to file Bills of Entry for home consumption and clearance of the four barges.
4. Ownership and possession of the four barges.
5. Environmental concerns and potential scrapping of the barges.
6. Payment of redemption fine by a person other than the owner.
7. Protection of the respondent's interest.
8. Granting of relief to the applicant.

Analysis:
1. The Tribunal had imposed a penalty of Rs. 2 lakhs on the applicant and upheld the confiscation of four imported barges, allowing redemption on payment of a fine to the original owner. The applicant challenged the confiscation and denial of the redemption option, seeking permission to clear the barges by filing Bills of Entry.

2. The applicant, still in possession of the barges under a supratnama, claimed that the original owners had sold the barges to them and were not interested anymore. The applicant offered to pay the redemption fine and applicable duties to secure the revenue, as the barges faced environmental issues and potential scrapping by the Gujarat Board Yard Works.

3. The issue of allowing payment of redemption fine by a person other than the owner was pending in the appeal. Despite the Tribunal's order allowing redemption by the original owner, who no longer had interest, the applicant was willing to pay the fine and duties. The respondent did not seek possession of the barges, leading to the necessity of considering the applicant's application.

4. To protect the respondent's interest and prevent the barges from being scrapped, the Court allowed the applicant to clear the four barges upon payment of the redemption fine and applicable duties. It was clarified that if the appeal failed, the applicant would not seek a refund of the amounts paid, ensuring the respondent's interests were safeguarded.

5. Therefore, the Notice of Motion was allowed, permitting the applicant to clear the four barges upon fulfilling the payment conditions, ensuring the revenue was secured and the environmental concerns addressed.