2016 (12) TMI 1310 - AT - Customs

Imposition of redemption fine and personal penalty - valuation of goods - rejection of declared value as found to be abnormally low - is quantum and imposition of fine and penalty justified? - Held that - the redemption fine and the penalties imposed in the present cases are not excess keeping in view the past conduct of the appellants. The goods imported are rightly confiscated under Section 111(d) of the Customs Act 1962 read with Section 3(3) of Foreign Trade (Development and Regulation) Act, 1992. The appellant had a mens rea in importing repeatedly the same thing knowing well that it is not permitted under the law. Therefore, the redemption fine and the penalty should be upheld - appeal dismissed - decided against appellant-assessee.

Issues:
1. Imposition of redemption fine and personal penalty on imported goods.
2. Assessment of assessable value by the Department.
3. Confiscation of goods under Customs Act 1962.
4. Appeal against Order-in-Appeals passed by Commissioner of Customs.

Issue 1: Imposition of Redemption Fine and Personal Penalty
The appellants imported used computer systems, monitors, hard disk drives, and processors without a license for second-hand goods. The Department used a Chartered Engineer to reassess the value of the goods due to exceptionally low declared values. The goods were confiscated with an option for redemption on payment of a fine and a personal penalty. The appellants argued that the redemption fine and penalty were excessive, while the Department contended that the penalties were justified due to the appellants' repeated importation of prohibited goods with mens rea. The Tribunal upheld the redemption fine and penalty, considering the conduct of the appellants and the circumstances of the case.

Issue 2: Assessment of Assessable Value
The Department revalued the imported goods with the help of a Chartered Engineer, which was accepted by the importers. The appellants did not challenge the confiscation but sought leniency in the imposition of redemption fine and penalty. The Tribunal noted that the reassessment by the Department was reasonable, and there was no error in imposing the redemption fine and penalty based on the revised assessable value determined by the Department.

Issue 3: Confiscation of Goods
The goods were confiscated under Section 111(d) of the Customs Act 1962 read with Section 3(3) of the Foreign Trade (Development and Regulation) Act, 1992, due to the absence of a license for importing second-hand goods. The appellants' argument that the confiscation was justified but sought leniency in the redemption fine and penalty was considered by the Tribunal. The Tribunal upheld the confiscation and the imposition of the redemption fine and penalty based on the appellants' conduct and awareness of the legal restrictions on importing such goods.

Issue 4: Appeal Against Order-in-Appeals
The appellants appealed against the Order-in-Appeals passed by the Commissioner of Customs (Appeals), Cochin, which rejected their appeals and upheld the Order-in-Original imposing fines and penalties. The Tribunal consolidated the appeals of both appellants as the issues involved were common and delivered a common order upholding the impugned orders and dismissing the appeals of the appellants based on the facts, circumstances, and conduct of the appellants presented during the hearing.

This detailed analysis of the judgment covers the issues related to the imposition of redemption fine and personal penalty, assessment of assessable value, confiscation of goods, and the appeal process against the Order-in-Appeals passed by the Commissioner of Customs.

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