2018 (7) TMI 188 - AT - Customs

Redemption fine - penalty - misdeclaration of imported goods - rerollable steel scrap - the goods were misdeclared as heavy melting scrap which attracts nil BCD - Held that - It is seen from the records that the appellant had misdeclared the goods as heavy melting scrap. However, the quantum of duty that would have been payable in case the goods are described as re-rollable scrap is only ₹ 63,000/- - further, the appellant is a first importer. The redemption fine can be reduced from ₹ 3,00,000/- to ₹ 1,00,000/- - quantum of penalty upheld - appeal allowed in part.

Summary

Issues: Misdeclaration of goods, evasion of customs duty, confiscation of goods, redemption fine, penalty imposition

The judgment revolves around a case where the appellant filed a Bill of Entry for clearance of goods declared as heavy melting scrap but were found to be rerollable steel scrap. The appellant did not produce a Pre-Shipment Inspection (PSI) certificate at the time of examination, leading the department to believe that misdeclaration occurred to evade customs duty. A show cause notice was issued, resulting in the original authority ordering confiscation of goods, redemption on payment of a fine of &8377; 3 lakhs, and a penalty of &8377; 2 lakhs under the Customs Act, 1962. The Commissioner (Appeals) later reduced the penalty to &8377; 50,000 without altering the confiscation or fine. The appellant contested the redemption fine and penalty before the Tribunal.

The appellant, through their consultant, acknowledged the confiscation but requested leniency in the redemption fine and penalty, arguing that the alleged duty evasion was minimal at &8377; 63,000. The appellant was a first-time importer, further justifying a reduction in the fine and penalty. On the other hand, the respondent reiterated the misdeclaration and absence of a valid PSI certificate.

After considering both sides, the Tribunal noted the misdeclaration but agreed that the duty payable if the goods were correctly described was only &8377; 63,000. Thus, the redemption fine was reduced to &8377; 1,00,000, while the penalty remained unchanged at &8377; 50,000 based on the Commissioner (Appeals) decision. The Tribunal found no grounds to interfere with the penalty reduction.

In conclusion, the Tribunal modified the original order by reducing the redemption fine to &8377; 1,00,000, maintaining the penalty at &8377; 50,000. The appeal was partly allowed on these terms.