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Issues: Classification of imported goods under Exim code, Confiscation of goods for lack of valid license, Appeal against the order of Commissioner (Appeals)
In this case, the appellants imported battery-operated toys of parrot under Bill of Entry No. 132139, valued at Rs. 4,11,967.71 (cif). Customs authorities contended that the goods fell under Exim code 950349.09, requiring a specific import license, while the importers believed they were covered under Exim Code No. 950380.01. The Additional Commissioner held that the toys were classified under 950349.09, which required a license for import. As the importers failed to produce a valid license, the goods were confiscated under Section 111(d) of the Customs Act, 1962. A fine of Rs. 5,77,000/- was imposed, along with a penalty of Rs. 57,000/- under Section 112(a) of the Customs Act, 1962. The importers appealed before the Commissioner (Appeals), who initially allowed the appeal. However, the Revenue challenged this decision, leading to an appeal before the CEGAT. The CEGAT observed that the order of the Commissioner (Appeals) was not detailed and remanded the matter back for a fresh order. Upon re-adjudication, the Commissioner (Appeals) upheld the original authority's findings, rejecting the appeal of the importers. During the appeal before CEGAT, the importers argued that the goods should be classified under Exim code 9503.80, covering all toys incorporating a motor, based on the HSN Note (A) under Heading 9503. The importers contended that the toys fell under this broader category rather than the specific category of toys representing animals or non-human creatures. However, the CEGAT disagreed, stating that the specific heading for toys representing animals or non-human creatures under code No. 950340.00 was more appropriate for the imported goods, which were talking parrots. The CEGAT upheld the confiscation of goods due to the lack of a specific license but reduced the redemption fine to Rs. 3 lakhs and set aside the penalty on the importers, considering the potential for misunderstanding in the classification under the Exim policy. In conclusion, the CEGAT rejected the appeal, maintaining the confiscation of goods for lack of a valid license under the specific Exim code. The decision highlighted the importance of accurate classification under the Exim policy and reduced the redemption fine while waiving the penalty due to potential confusion in the interpretation of the policy entries.
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