2007 (10) TMI 85 - AT - Customs

Goods was not re-imported within the statutory time-limit prescribed as per Foreign Trade Policy Violation of Sec. 111(o)Custom Act hence goods are liable to confiscation Fine imposed by Comm(A) is 2 lac on goods valued at Rs. 4 lac is nominal In case of export fine is reduced further to 50,000

Summary

Issues: Violation of time limit for re-import of goods under Foreign Trade Policy and Customs Act, Confiscation of goods, Imposition of penalty

Issue 1: Violation of time limit for re-import of goods under Foreign Trade Policy and Customs Act

The appellants imported diamond studded gold jewelry for exhibition in the U.S.A. under specific provisions of the EXIM Policy and Handbook of Procedures. The Handbook of Procedures mandated re-import of unsold goods within 60 days from the closure of the exhibition, or 45 days as per the SEZ Rules 2006. However, the goods were re-imported after 124 days, well beyond the stipulated time frame. The appellants failed to obtain any valid extension for participating in other exhibitions, leading to a breach of the time limit requirements.

Issue 2: Confiscation of goods

The goods valued at Rs. 44,74,174/- were exported for exhibition but not re-imported within the prescribed time period as per the Foreign Trade Policy and Handbook of Procedures. This non-compliance led to the violation of provisions of the Customs Act, specifically Section 111(d) and Section 111(o), making the goods liable for confiscation. The Commissioner of Customs, Airport, Mumbai, ordered the confiscation of the goods under Section 111(o) and allowed redemption upon payment of a fine of Rs. 2,00,000/-. The appellants contested this decision by filing an appeal against the order.

Issue 3: Imposition of penalty

In addition to the confiscation of goods, a penalty of Rs. 1 lakh was imposed on the appellants under Section 112(a) of the Customs Act for rendering the goods liable to confiscation. The appellants argued that they had requested an extension for re-import, which was acknowledged but not granted. They also highlighted their clean track record as exporters. The appellate tribunal acknowledged the violation of the statutory time limit but considered the circumstances. The tribunal upheld the confiscation of goods but reduced the penalty from Rs. 1 lakh to Rs. 50,000, considering the facts and circumstances of the case.

In conclusion, the appellate tribunal upheld the confiscation of goods due to the violation of the time limit for re-import under the Foreign Trade Policy and Customs Act. The penalty imposed under Section 112(a) was reduced to Rs. 50,000, while the redemption fine of Rs. 2,00,000 was maintained. The tribunal found the redemption fine fair and reasonable, given the value of the goods, and deemed the penalty reduction appropriate based on the circumstances presented by the appellants.