2017 (9) TMI 1651 - AT - Customs

Release of goods on payment of redemption fine - Gold - Section 125 of the Customs Act, 1962 - Held that - Only prohibited goods cannot be released on payment of redemption fine. Admittedly, the gold in question is not prohibited goods under the Customs Act or any other law in force - the goods in question cannot be absolutely confiscated in terms of Section 125 of the Customs Act, 1962 - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Appeal against order allowing redemption of seized gold on payment of fine.
2. Interpretation of Section 125 of the Customs Act, 1962.
3. Confiscation of goods and imposition of penalty.

Analysis:
The appeal before the Appellate Tribunal CESTAT ALLAHABAD concerns the redemption of seized gold on payment of a fine, as allowed by the learned Commissioner (Appeals). The Revenue challenges this decision, contending that the Commissioner erred in permitting the redemption of the gold by paying a fine instead of confiscating it. The Tribunal, comprising Shri Ashok Jindal, Member (J), examined the matter. The Customs Act, 1962, specifically Section 125, was pivotal in this case. Section 125 provides the option to pay a fine in lieu of confiscation, with certain limitations. Notably, only goods prohibited under the Act or other laws can be subjected to redemption fines. As the gold in question was not prohibited, the Tribunal concluded that it could not be absolutely confiscated under Section 125. Consequently, the impugned order allowing redemption of the gold was upheld, and the Revenue's appeal was dismissed.

This judgment delves into the nuances of interpreting Section 125 of the Customs Act, emphasizing that only prohibited goods can be released on payment of redemption fines. The Tribunal's analysis clarifies that goods not falling under the category of prohibited items cannot be confiscated under this provision. By upholding the impugned order, the Tribunal reinforces the principle that the application of redemption fines is contingent upon the nature of the goods in question. The decision underscores the importance of aligning confiscation actions with the specific provisions of the Customs Act, ensuring a judicious application of penalties and fines in customs-related matters.