2017 (11) TMI 102 - AT - Customs

Absolute Confiscation of Foreign Currency and Indian Currency - Baggage Rules - case of appellant is that he is carrying the amount for medical treatment - Held that - appellant requires this currency for the purpose of treatment on relying upon circular No.5/2002/09 dated 01.07.2008, issued by foreign currency department - RBI held that the appellant being resident individual, can utilize unspent foreign currencies under his possession. Mere non-declaration does not mean absolute confiscation. Coming to such a conclusion, he held that the currencies needs to be confiscated but to be released on payment of redemption fine. Currency to be released on payment of Redemption fine - quantum of redemption fine and penalty reduced - appeal allowed in part.

Summary

Issues: Confiscation of foreign and Indian currency, Imposition of penalty under Customs Act, 1962

Confiscation of Currency:
The appellant contested the confiscation of foreign and Indian currency recovered from him at the Bangalore International Airport. The adjudicating authority ordered absolute confiscation of the currencies and imposed penalties under section 114(i) and 114AA of the Customs Act, 1962. The first appellate authority upheld the confiscation but set aside the absolute confiscation, allowing redemption of the currencies on payment of a fine. The appellate tribunal agreed with the first appellate authority's decision, citing the appellant's explanation for carrying the foreign currency for medical treatment. The tribunal found that non-declaration did not warrant absolute confiscation, and the currencies should be released on payment of a redemption fine. The tribunal reduced the redemption fine from ?10,00,000 to ?5,00,000 for justice to be served.

Imposition of Penalty:
The appellant argued against the penalty imposed under section 114(i) and 114AA of the Customs Act, 1962, claiming it was unwarranted and based on shifting stands by the authorities. The learned counsel highlighted the appellant's explanation for possessing the foreign currency and contested the penalties as excessive. The tribunal reviewed the penalties and found them to be excessive as well. The penalty under section 114(i) was reduced from ?2,00,000 to ?50,000, and the penalty under section 114AA was reduced from ?1,00,000 to ?50,000. The tribunal considered the circumstances of the case and adjusted the penalties accordingly, disposing of the appeal with the modified penalties and redemption fine.

In conclusion, the appellate tribunal upheld the confiscation of the currencies but allowed redemption on payment of a reduced fine. The penalties imposed under the Customs Act, 1962 were deemed excessive and were reduced to ensure fairness and justice in the case. The judgment provided a detailed analysis of the appellant's contentions, the authorities' decisions, and the legal provisions governing the confiscation and penalties, ultimately delivering a balanced resolution to the issues at hand.