2017 (3) TMI 702 - AT - Customs

Confiscation - redemption fine - penalty - confiscation on the ground that at the time of import, the foreign manufacturer of the energy saving lamps imported by the appellant was not registered - Held that - the appellant had tried to obtain the registration much before the actual imports and in these circumstances, imposition of heavy redemption fine and penalty is not justified - the redemption fine is reduced from ₹ 20 lakhs to ₹ 2.00 lakhs and penalty is reduced from ₹ 7.8 lakhs to ₹ 1.00 lakh - appeal disposed off - decided partly in favor of appellant.

Summary

Issues:
1. Compliance with Bureau of Indian Standards (BIS) for imported goods.
2. Imposition of penalty and redemption fine for non-compliance.
3. Retroactive application of regulatory amendments.
4. Justification for reduction of redemption fine and penalty.

Compliance with BIS Standards:
The appellant imported "Tulip Brand Energy Saving Lamps" from Sri Lanka, which required compliance with the Bureau of Indian Standards (BIS) as per the Import Policy. The foreign manufacturer was not registered with BIS at the time of import, leading to confiscation of goods and imposition of penalties.

Imposition of Penalty and Redemption Fine:
The appellant argued that the manufacturer had initiated the registration process with BIS before the imports, citing delays in procedural requirements. The appellant relied on a Tribunal decision in a similar case to support their argument against confiscation and penalties. However, the Assistant Commissioner relied on the impugned order.

Retroactive Regulatory Amendments:
The Tribunal noted that the requirement for BIS registration was introduced in 2000, with the impugned item being deleted from the list in 2004. The appellant's argument that the deletion should have retrospective effect was dismissed, considering the timeline of the regulation. Despite the appellant's efforts to register before import, heavy penalties were initially imposed.

Reduction of Redemption Fine and Penalty:
Considering the circumstances, the Tribunal found the imposition of heavy penalties unjustified. The redemption fine was reduced from ?20 lakhs to ?2.00 lakhs, and the penalty was reduced from ?7.8 lakhs to ?1.00 lakh. The Tribunal partially allowed the appeal based on the timing of registration efforts by the appellant and the regulatory context at the time of import.

This detailed analysis of the judgment highlights the issues of compliance with BIS standards, penalty imposition, retroactive regulatory amendments, and the rationale behind the reduction of fines and penalties in the case.