2015 (12) TMI 407 - AT - Customs

Import of restricted item - Redemption fine - Penalty - Held that - It is an admitted fact that the appellant imported the goods under one of a mistake. The violation of port restriction is only a venial breach. It is also not a fact that the appellant is a repeated offender. In view of the technical breach, and for that taking notice of the fact that the appellant have suffered heavy demurrage of ₹ 8 lakhs, I uphold the order of confiscation but reduced the redemption fine under Section 125 to ₹ 1 lakh and further set aside the penalty imposed under Section 112(a) of the Act - Decided partly in favour of assessee.

Summary

Issues:
- Appeal against reduction of redemption fine and penalty under Section 112(b) of the Customs Act.
- Import of goods declared as 'M.S. TMPB DEFECTIVE COILS' with violation of Foreign Trade Policy provisions.
- Confiscation of goods under Section 111(d) and imposition of redemption fine and penalty.
- Appeal before Commissioner (Appeals) leading to reduction of redemption fine and penalty.
- Arguments regarding deliberate default, contumacious conduct, and technical violations.
- Rulings cited in support of reducing redemption fine and penalty.
- Adjudication by the Tribunal on the technical breach and reduction of redemption fine and penalty.

Analysis:

The appellant appealed against the reduction of the redemption fine and penalty under Section 112(b) of the Customs Act, arising from the import of goods declared as 'M.S. TMPB DEFECTIVE COILS' with violations of the Foreign Trade Policy provisions. The goods were found to be restricted items under the Policy, leading to their detention. The appellant admitted the mistake in declaring the port of destination incorrectly, seeking sympathetic consideration. The original order held the goods liable for confiscation under Section 111(d) and imposed a redemption fine and penalty. The Commissioner (Appeals) partially allowed the appeal, reducing the redemption fine and penalty based on the facts and circumstances of the case, citing the ruling of the Supreme Court. The appellant contended no deliberate default and prayed for setting aside the fine and penalty, relying on precedents where port restrictions led to reduced fines. The Tribunal considered the technical breach, noting the appellant's heavy demurrage costs, and upheld the confiscation but reduced the redemption fine significantly to Rs. 1 lakh, setting aside the penalty under Section 112(a) of the Act. The appeal was allowed in part, with the appellant entitled to any consequential benefits in accordance with the law.