2016 (12) TMI 823 - AT - Customs

Imposition of redemption fine and penalty in lieu of confiscation - import of rough marble blocks - mis-declaration of description - Held that - I find that there is no merit in the appeals as adjudicating authority has correctly held that the goods imported are calcareous stone other than marble, which should be imported only under specific license during relevant period. To that extent, I uphold the impugned order. As regards the redemption fine imposed, I find that the adjudicating authority has imposed redemption fine of ₹ 38 lakhs as against the landed cost of ₹ 23 lakhs or the market price of ₹ 61 lakhs. Various decision of the Tribunal on the same issue is that the redemption fine is to be imposed @ 20% of the enhanced value which in that case approx ₹ 4.6 lakhs, which I find will meet the ends of justice. Accordingly, the redemption fine imposed in the case in hand of M/s Just Marble is reduced to ₹ 4.6 lakhs and in the case of Vaishno Marble, it is reduced to ₹ 4.6 lakhs. Subject to such modification, the impugned order of imposition of fine is upheld. As regards the penalties imposed, I find that the penalty imposed on M/s Just Marble is ₹ 7.5 lakhs, which is excessive in relation to the value of landed cost of the marble. Hence, I reduce the same to ₹ 2 lakhs. The penalty imposed on Vaishno Marble is also imposed ₹ 8 lakhs which is reduced to ₹ 2 lakhs. The penalties imposed by me are as per the various decisions of the Tribunal, wherein it was held that the penalty should be imposed @ 10% of the value of the landed cost of the imported goods. Appeal disposed off - quantum of redemption fine and penalties reduced - decided partly in favor of appellant.

Summary

Issues:
Redemption fine imposed in lieu of confiscation and penalties.

Analysis:
The appeals were directed against an Order-in-Original passed by the Commissioner of Customs (Import), Mumbai, regarding the redemption fine and penalties imposed. The appellants had imported rough marble blocks, which were provisionally assessed and later finalized with an enhanced value. The Customs authorities found mis-declaration as the goods imported were described as marble blocks but were actually calcareous stone, which was restricted. The adjudicating authority imposed a redemption fine of ?38 lakhs in lieu of confiscation and penalties under Section 112(a) of the Customs Act, 1962. The authority held that the goods were liable for confiscation under Section 111(d) and (m) of the Customs Act, 1962.

Upon considering the submissions, the Member (Judicial) found that the goods imported were indeed calcareous stone other than marble, which required a specific license for import during that period. The impugned order regarding this aspect was upheld. However, concerning the redemption fine, it was noted that the adjudicating authority had imposed a fine higher than the market price or the landed cost. Referring to previous Tribunal decisions, the redemption fine was reduced to ?4.6 lakhs for both appellants, Just Marble and Vaishno Marble, to meet the ends of justice. The penalties imposed were also reduced as they were found excessive in relation to the value of the goods. The penalties were reduced to ?2 lakhs each for both appellants, in line with Tribunal decisions suggesting a penalty of 10% of the landed cost of imported goods.

In conclusion, the appeals were disposed of by reducing both the redemption fine and penalties imposed, bringing the judgment to a close on 2nd December 2016.