2016 (6) TMI 1069 - AT - Customs

Mis-declaration of goods - import of scull/ slag - import of hazardous waste - levy of redemption fine and penalty - Held that - in this case on first check it was found that the HMS imported by the appellant having slag but after drawing the samples test cannot be done to ascertain the fact that the alleged scrap is actually slag or not and if it is slag whether it is of iron or steel and hazardous. As same is not found by any test report or by any expert opinion. In that case, the allegation of the Revenue that it was slag and hazardous waste is not sustainable as the said finding of the adjudicating authority is only on the basis of assumption and presumption which is not sustainable in the eye of law. - Benefit of doubt goes in favor of importer - Redemption fine and penalty set aside.

Summary

Issues:
Appeal against order confirming confiscation of slag and directing re-export on payment of redemption fine and penalty.

Analysis:
The appellant imported Heavy Melting Scrap (HMS) in which 51.690 MT was found as slag during examination. The samples drawn were not tested as the testing facility was unavailable, leading to misdeclaration allegations. The adjudicating authority confiscated the slag, imposed a redemption fine of Rs. 10,000, and a penalty of Rs. 1 lakh, directing re-export on payment of fine and penalty. The appellant challenged the re-export order citing discrimination and lack of testing. The appellant imported another consignment with slag, which was allowed for home consumption after payment of fine and penalty. The appellant argued that no discrimination should exist, and testing was necessary to confirm the nature of the alleged slag.

In a similar case involving M/s Oasis Enterprises Pvt. Limited, the order for home consumption was set aside by the Commissioner (Appeals), indicating no discrimination against the appellant. The Revenue contended that since slag was visibly present, no test report was required, and the appeal should be dismissed. However, the absence of a test report to confirm the hazardous nature of the alleged slag raised doubts. The adjudicating authority's finding was based on assumption and presumption, lacking legal sustainability. Consequently, the benefit of doubt favored the appellant, leading to the set-aside of confiscation, redemption fine, penalty, and re-export order.

In conclusion, the Tribunal allowed the appeal, disposing of the miscellaneous application. The decision highlighted the importance of substantiated findings and legal sustainability in confiscation cases involving alleged hazardous materials, emphasizing the need for conclusive evidence rather than assumptions or presumptions.