2002 (3) TMI 139 - AT - Customs

Summary

Issues Involved:
(i) Absolute confiscation of old and used diesel engines u/s 111(d) of the Customs Act, 1962 read with Sections 3(2) and 3(3) of the Foreign Trade (Development & Regulation) Act, 1992.
(ii) Discretion of the Commissioner of Customs, Pune in absolutely confiscating the goods when similar consignments were released on payment of Redemption Fine.

Summary:

Issue (i): Absolute Confiscation:
The Commissioner relied on the case of Shehla Enterprises [1995 (80) E.L.T. 360 (T)] and the Supreme Court decision in Sheikh Mohammed Omar [1983 (13) E.L.T. 1439 (S.C.)] to justify absolute confiscation, arguing that restrictions on imports should be treated as prohibitions. The appellants contended that the impugned order went beyond the show cause notice, as it did not reference the 37 similar consignments, and argued that they imported the goods as actual users under Para 5.3 of the EXIM Policy. The Tribunal found no misdeclaration of quantity, quality, or value and determined that absolute confiscation should be set aside, following the precedent in Care International v. CC, Madras [1994 (69) E.L.T. 74 (T)].

Issue (ii): Discretion of the Commissioner:
The Tribunal noted that the Commissioner had previously allowed similar imports on payment of Redemption Fine, as seen in the case of M/s. Preet International. The Tribunal emphasized the importance of consistent treatment of similar cases, citing the binding effect of administrative precedents. The Tribunal found the Commissioner's selective application of absolute confiscation to be unfair and not in line with established practices. The Tribunal also referenced the principle of legitimate expectation, as outlined in Sunshine International v. Collector of Customs, Madras [1993 (42) ECC 282 (Mad.)], and found that the first-time SSI importers had a reasonable expectation of being treated similarly to previous importers.

Conclusion:
The Tribunal ordered the setting aside of the absolute confiscation and directed the adjudicating authority to permit clearance on Redemption Fine, taking into account the Board's instructions and the need for consistent application of the law. The appeal was allowed, and the matter was remanded for re-determination of the Redemption Fine and penalty.