2014 (7) TMI 184 - AT - Customs

Confiscation of goods - sugar for exportation - sub-standard quality - Whether the goods were liable for confiscation for violation of provisions of Section 113 (k) of the Customs Act, 1962 or not - Held that - goods can be held liable for confiscation on account of any willful act, negligence or default of the exporter, his agent of employee. From the facts of this case, it is clear that the appellant has taken proper care before the exportation of the goods. In this circumstance, it cannot be held that the appellants have violated the provisions of Section 113 (k) of the Act. In these circumstances, I hold that the goods are not liable for confiscation and consequently redemption fine and penalty are not imposable - Decided in favour of assessee.

Summary

Issues:
1. Confiscation of goods for violation of Section 113(k) of the Customs Act, 1962.

Analysis:
The appellant, a merchant exporter, appealed against an order confiscating goods procured for exportation due to non-compliance with the required grade standards. The goods were inspected at the docks and found that a significant portion did not meet the specified grade. The adjudicating authority invoked Section 113(k) of the Customs Act, 1962, leading to the confiscation of the goods and imposition of redemption fine and penalty. The appellant contended that there was no intention to export substandard goods, and therefore, confiscation, fine, and penalty were not justified.

Upon hearing both parties, the advocate for the appellant argued that in a previous round of litigation, the matter was remanded for reconsideration, emphasizing that the goods were not meant for export in their non-standard condition. The Revenue's representative supported the impugned order's findings. The central issue revolved around whether the goods were liable for confiscation under Section 113(k) of the Customs Act, 1962.

The Tribunal examined the provisions of Section 113(k) which stipulate that goods can be confiscated due to willful acts, negligence, or defaults of the exporter or their representatives. However, in this case, it was evident that the appellant had taken necessary precautions before exportation. Consequently, the Tribunal concluded that the appellant had not violated Section 113(k) and, therefore, the goods were not liable for confiscation. As a result, the appeal was allowed, and no redemption fine or penalty was imposed.