2017 (7) TMI 550 - AT - Customs

Redemption fine - penalty - old and used digital multifunction printing and copying machines with standard accessories - restricted item or not? - Held that - The goods during the time were not restricted as per provisions of para 2.17 of the Foreign Trade Policy being not per se photocopiers but multifunctional digital printing photocopiers. The restriction in regard to multifunctional digital copiers came into existence in the year 2012 only. However, since the value has been enhanced and the appellants are not contesting the enhancement of value, we are of the considered view that the redemption fine and penalties cannot be set aside in toto - redemption fine of ₹ 1,00,000/- and personal penalty of ₹ 75,000/- would meet the ends of justice - appeal allowed - decided partly in favor of appellant.

Summary

Issues involved:
Import of old and used digital multifunction printing and copying machines, enhancement of declared value, imposition of redemption fine and penalties under Customs Act, 1962, confiscation of goods as restricted items under Foreign Trade Policy.

Analysis:
The appellants imported old and used digital multifunction printing and copying machines with standard accessories, leading to an enhancement of the declared value by the department. The department considered the goods as liable for confiscation due to being restricted items under Para 2.17 of the Foreign Trade Policy. In Appeal No.C/8/2008, the declared value was increased from ?12,79,185 to ?23,16,281, with a redemption fine of ?6,95,000 and an equal penalty under section 112(a) of the Customs Act, 1962. In Appeal No. C/262/2008, the declared value of USD 48,550 was enhanced to USD 60,245, with a redemption fine of ?10.00 lakhs and a penalty of ?5 lakhs.

During the hearing, the appellants did not contest the enhancement of value but challenged the imposition of redemption fine and penalties. The appellants argued that the goods were confiscated on the basis of being restricted items under the Foreign Trade Policy, even though the import of such goods was not restricted during the relevant period of import in 2007. They contended that no license was required for the import of multi-function printing and copying machines at that time.

The learned counsel for the appellants submitted that the redemption fine and penalties imposed were unjustified, while the learned AR reiterated the findings in the impugned order, emphasizing the mis-declaration of the goods' value. The Tribunal considered both sides' submissions and noted that the goods were not restricted during the relevant period, as the restriction on multifunctional digital copiers came into effect in 2012. However, since the appellants did not contest the enhancement of value, the Tribunal upheld the redemption fine and penalties partially. In Appeal No.C/8/2008, the redemption fine was reduced to ?1,00,000 and the personal penalty to ?75,000. In Appeal No. C/262/2008, the redemption fine was reduced to ?1,00,000 and the personal penalty to ?50,000.

The appeals were partly allowed with the above modifications, maintaining the enhancement of value, and providing consequential benefits if any, without disturbing the original decision.