2015 (10) TMI 956 - AT - Customs

Attempting export of prohibited goods Packaging of goods in plastic pouches Since tobacco products were found to be packed in plastic pouches which were no longer permissible, sample were forwarded for testing to Dy. Chief Chemist, who opined that percentage composition was 11.5% plastic and balance tobacco Commissioner held that goods have been entered for exportation in contravention of provisions under Plastic Waste (Management and Handling) Rules, 2011 thus were liable for absolute confiscation and liable to penalty Held that - where tobacco products have been manufactured in 100% EOU and meant only for export, products can be packed in plastic sachet In view of amendment in mode or packing made by Ministry of Environment & Forest, vide Notification, there was confusion as to effect of same In view of clarification by Supreme Court, there was no contumacious conduct on part of appellant in carting in tobacco product for export packed in plastic sachet Impugned order of confiscation and penalty set aside Appellant entitled to refund of fine and penalty already deposited Decided in favour of Appellant.

Summary

Issues:
1. Confiscation of goods exported in plastic sachet under Plastic Waste Rules, 2011.
2. Imposition of redemption fine and penalty under Customs Act, 1962.
3. Interpretation of Plastic Waste Rules in the context of 100% EOU manufacturing for export.

Analysis:
1. The appellant, a merchant exporter, exported tobacco products packed in plastic sachets under the 100% EOU Scheme. Customs objected to the plastic packaging, citing the Plastic Waste Rules, 2011, leading to confiscation of goods and imposition of penalties under the Customs Act. The Commissioner (Appeals) allowed redemption of goods on payment of a fine. The appellant contended genuine mistake and absence of mala fide intent, seeking relief from confiscation and penalties.

2. The appellant challenged the confiscation and penalties, arguing that recent changes in packing legislation and the nature of the mistake warranted leniency. Citing a Supreme Court ruling exempting certain exporters from the Plastic Waste Rules, the appellant claimed compliance with export-oriented plastic packaging norms. The appellant presented undertakings from the manufacturer and relevant legal interpretations to support their case.

3. The Tribunal, considering the Supreme Court's guidance and the confusion surrounding plastic packaging regulations, held that the appellant's actions did not constitute deliberate non-compliance. Relying on the exemption granted by the Supreme Court to similar exporters, the Tribunal allowed the appeal, setting aside the confiscation and penalties. The appellant was permitted to retrieve the goods for potential reuse, with refunds of fines and penalties deposited earlier, along with applicable interest.

In conclusion, the Tribunal's decision favored the appellant, emphasizing the lack of intentional wrongdoing and the evolving regulatory landscape regarding plastic packaging for export-oriented goods. The judgment highlighted the importance of legal interpretations and compliance with relevant exemptions while addressing the complexities of environmental regulations in export scenarios.