2018 (2) TMI 1506 - AT - Customs

Import of restricted item - two consignments of 3- OD Tubing (seamless pipes) classifiable under CTH 7304 - confiscation - redemption fine - penalty - As per Foreign Trade Policy 2004-2009, import of such goods was allowed free . However, DGFT vide Notification No.64/2008 dated 24.11.2008 amended the policy which reads as Import Policy for the item Seamless Tubes/Pipes under 4 digit Exim Code 7403 will be amended to read as Restricted (instead of free ). However, this restriction imposed on import was lifted subsequently by DGFT vide Notification No.81/2008 dated 16.1.2009. Held that - the appellant-importer has bonafidely imported the said goods and has undertaken effective steps for importing the same when that was freely importable prior to 24.11.2008 and further the restriction imposed under Notification No.64/2008 stood withdrawn vide subsequent Notification No.81/2008 dated 16.1.2009 - There was no restriction both at the time of placing the orders and also when the Bill of Entry was filed subsequently on 16.1.2009. The appellant has also taken effective steps for obtaining licence from the DGFT - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Whether the goods imported by the appellant were rightly confiscated under Section 111(d) of the Customs Act with an option to redeem on payment of a fine and imposition of penalty under Section 112(a) of the Customs Act.

Analysis:
The appellant imported two consignments of seamless pipes and filed Bills of Entry in January 2009. Initially, the import of such goods was allowed 'free,' but a subsequent amendment by DGFT imposed restrictions. However, this restriction was lifted later. The appellant had applied for opening a Letter of Credit before the restriction was enforced, and the Bills of Entry were filed after the restriction was lifted. The appellant also applied for an import license, which was issued by DGFT specifically covering the goods in question. The Tribunal found that the appellant had imported the goods in good faith, taking effective steps for importation when the goods were freely importable and when the restriction was lifted. The appellant had not violated any provisions of the Customs Act, and the Tribunal set aside the impugned order, ruling in favor of the appellant. The Tribunal held that the appellant was entitled to a refund of the redemption fine and penalty paid under protest at the time of clearance, with interest to be granted within 45 days. The appeal was allowed with consequential benefits.