2016 (12) TMI 638 - AT - Customs

Confiscation of goods - imposition of redemption fine and penalty - Held that - When appellants failed even today to repel the argument of Revenue on merit, there is no doubt that certain contributor factors to determine redemption fine and penalty are considerable looking to the spirit of the proviso under section 125(1) of the Customs Act, 1962 and section 112 of the Customs Act, 1962. A higher limit not exceeding the market value of goods less than the duty payable is prescribed as redemption fine in law. Learned Commissioner (Appeals) has not gone to extreme limit. But he has proceeded upto 25% of the assessed value to impose redemption fine. He also found that penalty was rightly imposed - In all cases, import being of restricted goods, levy of penalties is confirmed finding nothing unreasonable looking to the nature of goods, life thereof as well as deliberate import of old and used machines in violation of law. Appeal disposed off - redemption fine reduced - decided partly in favor of appellant-assessee.

Summary

Issues:
1. Reasonableness of orders passed by the adjudicating authority.
2. Confiscation of goods as restricted items.
3. Failure of appellants to provide evidence.
4. Determination of redemption fine and penalty.
5. Calculation method for redemption fine.
6. Confirmation of penalties for import of restricted goods.

Analysis:
1. The appellant argued that the orders passed by the adjudicating authority were unreasonable due to extraneous considerations of irrelevant factors, making them unsustainable.
2. The Revenue contended that the orders met legal scrutiny, justifying confiscation as the goods were restricted items. The appellants failed to provide evidence to support their position, leading to the option of redemption being offered based on the condition of the goods.
3. Upon hearing both sides and examining the records, it was evident that the appellants could not refute the Revenue's argument on merit, leading to the consideration of factors for determining redemption fine and penalty under relevant customs laws.
4. The determination of redemption fine and penalty involved a consideration of important factors such as demand, supply, and the condition of the imported goods. The Commissioner (Appeals) imposed a redemption fine up to 25% of the assessed value and upheld the penalty.
5. Considering the life and condition of the imported machines, a percentage method for calculating redemption fine was deemed unreasonable. Therefore, reduced redemption fines were directed for each appeal, reflecting a more appropriate approach based on the utility and productivity of the goods.
6. Importing restricted goods and deliberate violations of the law warranted the confirmation of penalties in all cases, given the nature of the goods and the deliberate actions of the appellants.

This judgment highlights the importance of evidence, legal scrutiny, and the consideration of relevant factors in determining redemption fines and penalties for the import of restricted goods, ensuring a balanced approach in line with customs laws and regulations.