2018 (2) TMI 584 - AT - Customs

Import of restricted item - old/used digital multifunctional Print and Copying Machines - Department took the view that the impugned goods are restricted for import and required valid license for import, which was not produced by the importer - Held that - the imported goods in question are not restricted item - the imposition of redemption fine and penalty are unsustainable and are required to be set aside. The impugned order is modified by setting aside, the redemption fine and penalty imposed without disturbing the enhancement of value - appeal allowed in part.

Summary

Issues: Import of old/used digital multifunctional Print and Copying Machines without a valid license, enhancement of goods value, imposition of redemption fine and penalty, reduction of redemption fine and penalty by the Commissioner (Appeals), sustainability of redemption fine and penalty.

Analysis:
1. Import of Restricted Goods: The issue revolved around the import of old/used digital multifunctional Print and Copying Machines at a declared value, which the Department deemed restricted for import without a valid license. The adjudicating authority enhanced the value of the goods and confiscated them under Section 111 (d) of the Customs Act, 1962. The importer was given the option to redeem the goods on payment of a fine and a penalty was imposed under Section 112 (a) of the Customs Act, 1962.

2. Appeal by the Appellant-Assessee: The appellant contested the imposition of redemption fine and penalty, arguing that during the relevant period, the goods were not restricted for import. The appellant relied on a judgment of the Hon'ble High Court of Madras, which held that there was no restriction on the import of such machines before a specific date. The appellant agreed to the enhancement in the value of the goods but challenged the imposition of fine and penalty.

3. Appeal by the Revenue: The Revenue appealed against the Commissioner (Appeals) order, which had reduced the redemption fine and penalty percentages. The Revenue argued that the goods imported were restricted, and the reduction in the redemption fine and penalty was not justified, especially considering the importer's history as a habitual offender with a high profit margin.

4. Tribunal's Decision: After hearing both sides and examining the records, the Tribunal found merit in the appellant's submissions. Relying on the judgment of the Hon'ble High Court of Madras, the Tribunal held that the imported goods were not restricted during the relevant period. Consequently, the imposition of redemption fine and penalty was deemed unsustainable and set aside. The Tribunal dismissed the Revenue's appeal and modified the impugned order by upholding the enhancement of the goods' value but removing the redemption fine and penalty.

5. Final Verdict: The Tribunal partly allowed the appellant's appeal by setting aside the redemption fine and penalty while dismissing the Revenue's appeal. The judgment clarified that during the relevant period, the imported goods were not restricted items, leading to the decision to remove the redemption fine and penalty imposed on the importer.