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Issues:
1. Confiscation of Pharmaceutical Chemicals due to lack of proof of licit importation. 2. Applicability of Section 11B of the Customs Act, 1962 regarding proof of legal import/possession. 3. Violation of conditions of importation against actual users condition. 4. Liability for breach of conditions of the license granted under the Imports and Exports (Control) Act, 1947. 5. Imposition of personal penalty in addition to confiscation. Analysis: The judgment pertains to the seizure and confiscation of Pharmaceutical Chemicals from M/s. M. Darshibhoy & Co., Calcutta, due to the lack of proof of licit importation, resulting in a penalty of Rs. 1,000 being imposed on the applicants. The revision application was filed after the Central Board of Excise & Customs rejected their appeal. The applicants argued that since the goods were not notified under Section 11B of the Customs Act, 1962, they were not obligated to provide proof of legal import or possession. However, it was admitted that the goods were not imported by them but by the State Chemicals and Pharmaceuticals of India Ltd., a Government Organization, for distribution to actual users, leading to a breach of the conditions of importation against actual users condition. The judgment highlighted that the Customs Act, particularly Section 111(o), allows for confiscation of goods if there is a contravention of the conditions of importation, even if there is no waiver available by the proper officer. The liability for breach of conditions of the license under the Imports and Exports (Control) Act, 1947, and the liability of goods to be confiscated under Section 111 of the Customs Act are independent. Therefore, the customs authorities have the power to confiscate goods under Section 111(o) of the Customs Act, as established in previous cases such as R.K. Industries v. Collector of Customs & Central Excise and Fine Blanking Pvt. Ltd. v. Collector. Regarding the imposition of personal penalty, it was clarified that while confiscation of goods is effective in rem, penalties are in personam and can be imposed on individuals involved in dealing with goods liable for confiscation. In this case, the applicants were penalized under Section 112(b) as they were indirectly associated with the breach of conditions. The penalty was reduced to Rs. 250 considering their indirect involvement. The judgment upheld the orders of lower authorities in terms of confiscation and penalty imposition, concluding the revision application.
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