2024 (2) TMI 874 - AT - Customs

Confiscation of goods - import of old and used worn clothing, completely fumigated / old and serviceable garments - Valuation - Restricted goods or not - enhancement of value - 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 observed The 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. However, the paucity of evidence and the negligible scope for ascertainment at this stage deters us from doing so. Against the confirmed duties and the penalties the Redemption Fine imposed by the Adjudicating Authority, the Respondents have not filed any Appeals. The redemption fine and penalty imposed on the Respondents by the adjudicating authority is sufficient to meet the end of justice. Therefore, the redemption fine and penalty confirmed by the adjudicating authority are upheld - there are no infirmity in the impugned orders and the same are upheld. Appeal of Revenue dismissed.

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 the goods under Tariff Item No.63090000, and the compliance with licensing requirements under the Foreign Trade Policy.

Enhancement of Redemption Fine and Penalty:
The Revenue appealed against the impugned orders which assessed the imported old and used worn clothing after value enhancement, confiscation, and imposition of redemption fine and penalty. The declared value was increased from US$ 0.45 per kg to US$ 0.60 per kg, and redemption fine and penalty were imposed due to the classification of the goods under Tariff Item No.63090000 and the violation of import restrictions. The Adjudicating Authority imposed redemption fine and penalty at the rates of 19.5% and 7.8% of the assessed value, respectively. The Revenue sought enhancement of these amounts, but the Tribunal, following a previous decision, upheld the redemption fine at 10% of the ascertained value and penalty at 5%.

Compliance with Licensing Requirements:
The Tribunal referred to a previous case where it was observed that confiscation under Section 111(d) of the Customs Act, 1962 was justified for the import of old and serviceable garments without the required import license as per the Foreign Trade Policy. The Tribunal upheld the confiscation of the goods but reduced the redemption fine and penalty to 10% and 5% of the ascertained value, respectively. The Tribunal noted the failure of the original authority to disclose the margin of profit that prompted the fine and penalty but decided against remitting the case for further review due to the lack of evidence and scope for ascertainment at that stage.

Conclusion:
The Tribunal dismissed the Appeals filed by the Revenue, upholding the redemption fine and penalty imposed by the adjudicating authority. It found no infirmity in the impugned orders and confirmed the redemption fine at 10% of the ascertained value and penalty at 5%. The decision was based on the compliance issues with licensing requirements and the lack of evidence for further review.