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Issues Involved:
1. Validity of the import under the Customs Act. 2. Requirement of an import license due to amendment in the Import Control Order. 3. Imposition of redemption fine and its justification. 4. Whether the import was complete and the applicability of relevant case laws. 5. The effect of re-export on the imposition of redemption fine. 6. The petitioners' bona fides and the absence of mens rea. Issue-wise Detailed Analysis: 1. Validity of the import under the Customs Act: The petitioners argued that there was no import under the Customs Act because the goods were never cleared for home consumption and were re-exported directly from the warehouse. They contended that the goods did not mix with the land mass of India and remained under customs control. The court, however, found that the goods entering India become imported goods and are chargeable to duty unless exempt. The court held that the import was valid and the goods were subject to customs regulations. 2. Requirement of an import license due to amendment in the Import Control Order: The amendment to the Import Control Order on 23rd February 1988 required an import license for re-export other than as ship's stores. The petitioners claimed they were unaware of this amendment until 30th March 1988 and had entered into the import contract based on the previous policy. The court noted that the petitioners' import was not covered under the Open General License (OGL) as they did not fulfill the requirements of being actual users. 3. Imposition of redemption fine and its justification: The Collector of Customs ordered the confiscation of the goods under Section 111(d) of the Customs Act, read with Section 3 of the Imports and Exports (Control) Act, 1947, but allowed clearance on payment of a redemption fine. The petitioners paid the fine to avoid demurrage. The court upheld the imposition of the redemption fine, stating that the goods were imported in contravention of the import policy and the fine was justified under Section 125 of the Customs Act. 4. Whether the import was complete and the applicability of relevant case laws: The petitioners relied on judgments from the Apex Court, arguing that the import was not complete as the goods were warehoused and re-exported. The court distinguished these cases, stating that the issue in the present case was the effect of the amendment to the Import Control Order and the legality of the import. The court held that the import was complete when the goods entered Indian territorial waters and were subject to customs control. 5. The effect of re-export on the imposition of redemption fine: The petitioners argued that since the goods were re-exported, no redemption fine should be imposed. The court rejected this argument, stating that the goods were allowed to be bonded and re-exported only after the payment of the redemption fine. The court emphasized that the fine was imposed due to the illegal import, and the subsequent re-export did not negate the imposition of the fine. 6. The petitioners' bona fides and the absence of mens rea: The petitioners contended that their actions were bona fide and there was no mens rea, as evidenced by the non-imposition of a penalty under Section 112 of the Customs Act. The court acknowledged the petitioners' efforts to cancel the import contract and Letter of Credit but found that the import was still in contravention of the amended policy. The court held that the absence of mens rea did not affect the legality of the redemption fine. Conclusion: The court dismissed the petition, upholding the orders of the Collector of Customs and the CEGAT. The court found that the import was in contravention of the amended import policy, and the imposition of the redemption fine was justified. The petitioners' arguments regarding the completion of import and the effect of re-export were rejected. The court emphasized that the petitioners had paid the redemption fine without protest and could not challenge it subsequently.
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