2017 (4) TMI 481 - AT - Customs

Export of prohibited goods - infringed copyright books - confiscation u/s 113 (d) of CA - Held that - there is a prohibition for the sale and trading of the infringed copyright books and also a prohibition on import into India. However, there is no prohibition provided in respect of export of the same goods. Therefore, the export of infringed copyright books has not been prohibited either under the Customs Law or under the Indian Copyright Act. Therefore, in the absence of any prohibition on the export of the said goods, the goods are not liable for confiscation. Consequently, the appellants are not liable for any penalty - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Imposition of penalties under Section 114(iii) of the Customs Act, 1962 for abetment of copyright infringement.
2. Interpretation of Section 51 of the Indian Copyright Act, 1957 regarding export of infringed copyright books.
3. Confiscation of goods and imposition of penalties based on the prohibition for sale or trade of infringed copyright books.

Analysis:
1. The case involved penalties imposed on two individuals for abetting infringement of copyright under Section 114(iii) of the Customs Act, 1962. The penalties were based on the allegation that they aided in the export of books with copyrights held by a UK Company. The department argued that the goods were liable for confiscation under Section 113(d) of the Customs Act due to the infringement. The appellants contended that there was no specific prohibition on the export of copyright-infringed goods under the Customs Act or the Copyright Act, and penalties under Section 114(iii) were not applicable. They cited a previous case where a similar issue was decided in their favor.

2. The interpretation of Section 51 of the Indian Copyright Act, 1957 was crucial in determining the legality of exporting infringed copyright books. The Tribunal noted that while the section prohibits sale, trade, and import of such books, it does not explicitly prohibit their export. This led to the conclusion that in the absence of a specific prohibition on exporting infringed copyright books, the goods were not liable for confiscation. The Tribunal also highlighted that the appellants' role was limited to the sale of the books within the country, not in their export, further supporting the decision.

3. The Revenue argued that under Section 51 of the Copyright Act, there was a prohibition on the sale or trade of infringed copyright books, justifying the confiscation of goods and imposition of penalties. However, the Tribunal disagreed, emphasizing that the section did not mention any prohibition on the export of such goods. Citing a previous judgment and the absence of any legal basis for confiscation or penalties in this case, the Tribunal allowed the appeals and modified the impugned order, ruling in favor of the appellants.

In conclusion, the Tribunal's detailed analysis of the legal provisions, including the Customs Act and the Copyright Act, led to the decision that the export of infringed copyright books was not prohibited, thus rendering the goods not liable for confiscation and the appellants not subject to penalties.