2015 (10) TMI 2444 - AT - Customs

Confiscation of goods under Section 113 of Customs Act, 1962 Contended by the Appellant that he did not have knowledge that rice supplied was not basmati Sample reports are contradictory in reference to 933 bags and alleged that Redemption Fine and penalty are excessively charged. Held That - Length of 7mm does not necessarily makes rice basmati - Report of Deputy Agricultural Marketing Adviser is not in disharmony with physical examination which merely stated that rice contained in 933 bags appeared to be of length 7mm - Such huge quantity purchased by appellant and he did not realise that goods were not basmati rice Redemption fine and penalty cannot be said as unwarranted - Appellant held guilty Decided in favour of the Revenue.

Summary

Issues:
- Confiscation of rice under Section 113 of the Customs Act, 1962
- Redemption fine and penalty imposition
- Mis-declaration of goods
- Appellant's contentions regarding purchase and knowledge
- Discrepancies in sample reports
- Appellant's reliance on judicial precedents for leniency and absence of mens-rea
- Analysis of the Deputy Agricultural Marketing Adviser's report
- Appellant's defense of being cheated by suppliers
- Quantity of goods involved in the offense
- Justification of the imposed fine and penalty

Confiscation of Rice:
The judgment involves the confiscation of 239.970 MT of rice valued at &8377; 73,36,098 under Section 113 of the Customs Act, 1962. The rice was attempted to be exported in violation of the prohibition on export of non-basmati rice during the relevant time. The Deputy Agricultural Marketing Adviser's report confirmed that the impugned rice did not conform to basmati rice specifications as per parameters, justifying the confiscation.

Redemption Fine and Penalty Imposition:
In addition to the confiscation, a redemption fine of &8377; 30,00,000 and a penalty of &8377; 15,00,000 were imposed. The appellant challenged the quantum of redemption fine and penalty as excessive, citing judicial precedents for determining fines based on circumstances and bonafide conduct. The tribunal upheld the imposed fine and penalty, considering the gravity of the offense and the quantity of the impugned goods involved.

Mis-declaration of Goods:
The appellant was found guilty of mis-declaration of goods as the rice attempted to be exported was not basmati rice as required. The primary adjudicating authority held the appellant responsible for the offense based on discrepancies in the goods found during examination and the Deputy Agricultural Marketing Adviser's report.

Appellant's Contentions and Defenses:
The appellant contended that they purchased the goods from suppliers who misrepresented them as basmati rice. However, the tribunal rejected this defense, emphasizing the appellant's obligation to ensure compliance with export regulations, especially when dealing with a substantial quantity of goods.

Analysis of Deputy Agricultural Marketing Adviser's Report:
The tribunal analyzed the discrepancies between the physical examination findings and the Deputy Agricultural Marketing Adviser's report. It concluded that the impugned goods were indeed not basmati rice, supporting the decision for confiscation and penalties.

Justification of Imposed Fine and Penalty:
Considering the nature and gravity of the offense, along with the quantity of goods involved, the tribunal found the imposed fine and penalty to be reasonable. The tribunal rejected the appellant's plea for leniency based on judicial precedents, emphasizing the seriousness of the offense and the appellant's failure to exercise due diligence.

In conclusion, the tribunal rejected the appeal and upheld the impugned order, affirming the confiscation of rice, imposition of redemption fine, and penalty based on the appellant's violation of export regulations and mis-declaration of goods.