2014 (12) TMI 1119 - AT - Customs

Imposition of redemption fine and penalty - contravention of Section 75 of the Customs Act, 1962 - Drawback claim - Misdeclaration of goods - Commissioner reduced redemption fine - Held that - Two antiques valued at ₹ 883 were concealed under 673 old and used furniture attempted to be exported claiming drawback. Customs found that such antiques were prohibited goods and liable to confiscation. Ld. Commissioner (Appeals) held that such a low value goods were not conceivable to be concealed for which conclusion of ld. adjudicating authority was wrong. Accordingly, he held that confiscation of 673 items of furniture was unwarranted. His finding is totally contradictory when he holds that under Section 103(f) of the Customs Act, 1962 old and used furniture were not eligible to draw back claim for which those were liable to confiscation. It is strange that how the ld. Commissioner (Appeals) came to a conclusion that the small value goods does not cause prejudice to the interests of justice when those prohibited goods were attempted to be exported. Once there was mis-declaration of description of goods, that calls for confiscation. Therefore, ld. Commissioner s finding is erroneous in so far as non-concealment of the antique is concerned. The materials on record suggest that the antiques were two pillars with engraved architecture therein and the 673 furnitures were old and used. It is surprising how ld. Commissioner reduced the redemption fine from ₹ 12 lakhs to ₹ 5 lakhs when there was a deliberate mis-declaration of the goods in the shipping bills - Redemption fine and penalty upheld - Decided against assessee.

Summary

Issues:
1. Confiscation of prohibited goods and imposition of penalties under Customs Act, 1962.
2. Claim of drawback for furniture meant for export.
3. Reduction of redemption fine and imposition of penalties by the Commissioner (Appeals).

Analysis:
1. The case involved the confiscation of two antique pieces valued at Rs. 883, found among 673 items of furniture meant for export. The antiques were deemed prohibited goods, leading to their confiscation. The Commissioner (Appeals) imposed a redemption fine of Rs. 5 lakhs for the furniture and penalties of Rs. 1 lakh and Rs. 2,500 under different sections of the Customs Act, 1962. The appellant argued that the penalties were excessive considering the low value of the antiques.

2. The Revenue contended that the Commissioner's order was appropriate. However, the Tribunal found discrepancies in the Commissioner's reasoning. While the Commissioner held that the concealment of low-value goods was unlikely, he also stated that the mis-declaration of goods warranted confiscation. The Tribunal noted the contradiction in these findings and upheld the confiscation of the antiques but deemed the confiscation of furniture unjustified.

3. The Tribunal observed that the antiques were pillars with engraved architecture, while the furniture was old and used. Despite deliberate mis-declaration in shipping bills, the Commissioner reduced the redemption fine from Rs. 12 lakhs to Rs. 5 lakhs. The Tribunal confirmed the redemption fine and the penalties imposed, considering the gravity of the matter. The Tribunal dismissed the appeal, affirming the redemption fine and penalties, as Revenue did not appeal against the reduction of the fine.

This comprehensive analysis highlights the key legal issues of confiscation, claim of drawback, and imposition of penalties under the Customs Act, 1962, as addressed in the judgment by the Appellate Tribunal CESTAT NEW DELHI.