2008 (5) TMI 40 - AT - Customs

Export of prohibited good charcoal - Even if let export order has not been issued, goods will be treated as export goods if they been brought to customs area - when a shipping is filed and the goods are brought to Customs area, attempt to export the goods starts and, at such stage, the goods attain the status of export goods confiscation and penalty are correct

Summary

Issues:
1. Confiscation of goods declared as 'charcoal' for export due to being a prohibited item.
2. Whether the goods attained the status of "export goods" when the shipping bill was filed.
3. Ignorance of law as a defense against confiscation and penalty under Sections 113 and 114 of the Customs Act.

Detailed Analysis:
1. The case involved the confiscation of goods declared as 'charcoal' for export, which was noted as a prohibited item under the export policy by Customs authorities while the consignment was at the CFS. The department issued a show-cause notice for confiscation under Section 113 (d) of the Customs Act and imposed a penalty under Section 114. The Assistant Commissioner confiscated the goods with an option for redemption on payment of a fine and imposed a penalty. The appeal against this order was rejected, leading to the present appeal against the appellate Commissioner's decision.

2. The main argument presented was whether the goods could be considered as "export goods" at the time of the show-cause notice issuance since a 'let export' order under Section 51 of the Customs Act had not been issued. The Customs Act's provisions under Sections 113 and 114 were contested for their applicability to the goods. Reference was made to a Public Notice stating that goods would attain the status of "export goods" only after the filing of the shipping bill. The Tribunal's decision in a similar case was also cited. The Tribunal rejected the plea of ignorance of law and held that the goods had indeed attained the status of "export goods" when the shipping bill was filed, as evidenced by the proper registration of the bill by Customs officials.

3. The Tribunal emphasized that ignorance of the law is not a valid defense for export-related matters, as exporters are expected to be aware of export laws. It was clarified that the goods had indeed reached the status of "export goods" upon filing the shipping bill and bringing the consignment to the Customs area. The Tribunal analyzed the relevant provisions of Sections 113 and 114 of the Customs Act, which deal with confiscation and penalties for improperly exported goods. It was concluded that the goods in question had met the criteria to be considered "export goods," and the lower authorities' decision on confiscation and penalty was upheld, albeit with a reduction in the fine and penalty amounts based on the case's circumstances.

In conclusion, the Tribunal dismissed the appeal against the order of confiscation and penalty, affirming that the goods had attained the status of "export goods" upon filing the shipping bill. The plea of ignorance of the law was rejected, and the fine and penalty amounts were reduced in consideration of the case's peculiar facts and circumstances.