2022 (6) TMI 1138 - AT - Customs

Import of kid bikes - allegation that the goods do not conform to the BIS requirements - Confiscation of the entire goods with an option to redeem the goods for the purpose of re-export only - levy of penalty - HELD THAT - From the narration of facts stated, it can be seen that out of 183 kids bikes, the department does not deny the identity of 157 kids bikes. So also, there is no dispute as to the brand of these 157 bikes. The dispute is with regard to the 26 nos. of kids bikes only. However, the authorities below have ordered for confiscation and directed to re-export the entire goods or for destruction of the same at the cost of the importer (appellant). The order for confiscation and re-export made in regard to 26 nos. of kids bikes does not require interference. From the records, it is seen that the goods were subjected to quality assurance test by National Accreditation Board for Testing Calibration Laboratory (NABL). This report is dated 30.05.2018. It can be presumed that before the original export to USA, the goods were subjected to test for quality and standards. It is affirmed by the department that the reimported 157 bikes belong to the lot that was originally exported. Therefore, it has to be construed that the appellant has complied with requirement of BIS standard (brand name) as well as identity of 157 nos. of bikes. The order of confiscation and re-export in respect of 157 bikes requires to be set aside - the impugned order is set aside and modified to the effect that the 157 nos. of kids bikes have to be released to the appellants for home consumption. Confiscation and order to re-export or for destruction of remaining 26 nos. of kids bikes is upheld.The redemption fine of Rs.1,00,000/- is imposed for the entire goods. It is directed that 157 nos. of kids bike has to be released on payment of redemption fine Rs.5,000/-. The requirement to pay redemption fine for 26 nos. of bikes for re-export is set aside. The penalty of Rs.50,000/- imposed under Section 112 (a) of the Customs Act, 1962 is reduced to Rs.1,000/-. Appeal allowed in part.

Summary

Issues:
1. Confiscation of imported goods due to lack of model number marking and non-compliance with BIS standards.
2. Dispute regarding the identity of re-imported goods.
3. Imposition of redemption fine and penalty under the Customs Act, 1962.

Issue 1: Confiscation of imported goods due to lack of model number marking and non-compliance with BIS standards:
The appellant imported kids bikes which were subjected to examination revealing that some bikes lacked model number marking and did not comply with BIS standards. The original authority ordered confiscation of the entire goods but allowed re-export within 30 days on payment of a redemption fine. The Commissioner (Appeals) upheld this decision. The appellant argued that the goods were re-imported and should not be subject to BIS standards. The Tribunal noted that the goods were examined twice, and while 157 bikes were confirmed, 26 bikes lacked the required marking. The Department insisted on compliance with BIS standards for goods intended for children under 14 years. The Tribunal upheld the confiscation of 26 bikes but set aside the order for the remaining 157 bikes, allowing them for home consumption upon payment of a reduced redemption fine.

Issue 2: Dispute regarding the identity of re-imported goods:
The appellant claimed that the 183 re-imported bikes were part of a lot exported to the US, with markings on 26 bikes possibly erased during handling. The Department argued that the absence of markings on these bikes indicated a failure to comply with BIS standards. The Tribunal found insufficient evidence to prove compliance with BIS requirements for the 26 bikes, leading to the confiscation and re-export order for these specific bikes while allowing the release of the remaining 157 bikes for home consumption.

Issue 3: Imposition of redemption fine and penalty under the Customs Act, 1962:
The appellant contested the redemption fine and penalty imposed for improper importation. The Tribunal reduced the penalty from Rs.50,000 to Rs.1,000 and modified the redemption fine, requiring payment of Rs.5,000 for the release of the 157 bikes allowed for home consumption. The appeal was partly allowed, setting aside the redemption fine for the 26 bikes marked for re-export and reducing the penalty under Section 112(a) of the Customs Act, 1962.

This detailed analysis of the judgment highlights the issues of confiscation, dispute over identity, and imposition of fines and penalties, providing a comprehensive overview of the legal proceedings and decisions made by the Tribunal.