2023 (8) TMI 1328 - AT - Customs

Valuation of imported goods - old and used worn clothing, completely fumigated - restricted item or not - classifiable under Tariff Item No.63090000 of the First Schedule of the Act - enhancement of value - confiscation - redemption fine - penalty - HELD THAT - This issue came up before this Tribunal in the case of VENUS TRADERS, RAINBOW INTERNATIONAL, AL-YASEEN ENTERPRISES, GLOBE INTERNATIONAL, KRISHNA EXPORT CORPORATION, PRECISION IMPEX, BMC SPINNERS PVT. LTD., SHIVAM TRADERS, LEELA WOOLEN MILLS, M.U. TEXTILES VERSUS COMMISSIONER OF CUSTOMS (IMPORTS) MUMBAI 2018 (11) TMI 625 - CESTAT MUMBAI , wherein this Tribunal has held that failure of the original authority to comply with the direction in remand to disclose the margin of profit that prompted the fine and penalty, the matter would normally have to be remitted back by another remand order. There is a failure of the original authority to comply with the direction in remand to disclose the margin of profit that prompted the fine and penalty, the matter would normally have to be remitted back by another remand order - the confiscation of the goods under Section 111(d) of Customs Act, 1962 upheld - the ends of justice would be served by reducing the redemption fine to 10% of the ascertained value and penalty to 5% - appeal allowed in part.

Summary

Issues involved:
The issues involved in the judgment are the enhancement of redemption fine and penalty imposed on imported old and used worn clothing, the classification of goods under restricted tariff item, and the compliance with licensing requirements for import.

Enhancement of Redemption Fine and Penalty:
The case involved the appeal by the Revenue against an order where the declared value of imported old and used worn clothing was enhanced, and redemption fine and penalty were imposed. The Adjudicating Authority had imposed redemption fine and penalty at specific rates, and the Revenue sought enhancement of these amounts. The Tribunal noted that the issue had been addressed in a previous case and cited the observations made in that case regarding the application of relevant sections of the Customs Act. The Tribunal found that the original authority had failed to comply with directions in the remand order, leading to difficulties in determining the value of misdeclared goods. Despite some objections raised by the appellants, the Tribunal ultimately upheld the redemption fine and penalty imposed by the adjudicating authority, reducing the amounts to 10% and 5% respectively.

Classification of Goods and Licensing Requirements:
The imported old and used worn clothing was classified under Tariff Item No.63090000, which is a restricted item for import as per the Foreign Trade Policy. The goods were assessed after value enhancement, confiscation, and imposition of redemption fine and penalty. The Adjudicating Authority invoked confiscation under Section 111(d) of the Customs Act for import of these goods without the required import license as prescribed under the Foreign Trade Policy. The Tribunal upheld the confiscation of goods under Section 111(d) but reduced the redemption fine and penalty amounts. The Tribunal emphasized the importance of compliance with licensing requirements for restricted items and noted that the respondents did not file any appeals against the confirmed duties, penalties, and redemption fine.

Compliance with Tribunal's Decision:
The Tribunal referred to a previous decision involving similar issues and held that the redemption fine and penalty imposed by the adjudicating authority were sufficient to meet the ends of justice. Despite some concerns raised by the appellants regarding the margin of profit and market survey, the Tribunal did not remand the matter back due to paucity of evidence and upheld the impugned order. The appeals filed by the Revenue were ultimately dismissed, and the redemption fine and penalty confirmed by the adjudicating authority were upheld.