2014 (8) TMI 124 - AT - Customs

Confiscation of goods - import of goods declared as used photocopier parts - Under valuation of goods - Redemption fine - Commissioner (Appeals) set aside the fine and penalty - Held that - Since the goods were old and used parts of photocopiers they were liable to confiscation under section 111 (d) of the Customs Act read with section 3(3) FT (D&R) Act 1993. To that extent, I uphold the order of the adjudicating authority. However, the redemption fine imposed by the adjudicating authority is reduced to ₹ 40,000/- (Rupees Forty thousand only) and penalty is reduced to ₹ 20,000 - Decided partly in favour of Revenue.

Summary

Issues:
1. Valuation of imported goods declared as "used photocopier parts" at Tuticorin Port.
2. Confiscation of goods under Customs Act and Foreign Trade Act.
3. Imposition of fine and penalty under Customs Act.
4. Appeal against the order of Commissioner (Appeals) by the Revenue.

Analysis:
1. The respondent filed a Bill of Entry for the import of goods declared as "used photocopier parts" valued at &8377; 1,64,179 at Tuticorin Port. The Revenue disputed the valuation and got a Chartered Engineer to revalue the goods at &8377; 4,30,468, which was not contested. The adjudicating authority confiscated the goods under Customs Act and allowed redemption on payment of a fine of &8377; 80,000 along with a penalty of &8377; 30,000.

2. The respondent appealed to the Commissioner (Appeals), who set aside the fine and penalty based on a decision of the Larger Bench of the Tribunal. The Revenue then filed an appeal against this order, arguing that the goods imported should have had the essential character of photocopiers, not just certain parts, as declared in the Bill of Entry.

3. The Revenue contended that the decision relied upon by the Commissioner (Appeals) applied to used photocopiers, and since the goods were only parts of photocopiers, confiscation was justified. The Revenue sought restoration of the original order. The respondent argued for leniency, citing low profit margins in the import of such items and requested a reduction in the fine and penalty imposed.

4. After considering the submissions, the Judge upheld the confiscation of the goods under the Customs Act and Foreign Trade Act due to their nature as old and used photocopier parts. However, the redemption fine was reduced to &8377; 40,000, and the penalty was reduced to &8377; 20,000. The order of the Commissioner (Appeals) was set aside, and the order of the adjudicating authority was partially modified. The appeal filed by the Revenue was partially allowed.