2004 (5) TMI 102 - AT - Customs

Summary

Issues:
1. Redemption fine and penalty imposed on the appellants for importing old diesel engines and car seats.
2. Confiscation of goods for undervaluation and lack of import license.
3. Contestation of the notice based on reconditioning, repair, and replacement grounds.
4. Disagreement on valuation and liability to confiscation.
5. Quantum of redemption fine and penalty.
6. Comparison with similar cases for determining appropriate redemption fine and penalty.
7. Acceptance of earlier orders for reducing fine and penalty.

Analysis:
1. The appellants were aggrieved by heavy redemption fine and penalty imposed for importing old diesel engines and car seats without an import license. The declared value was found to be on the lower side, leading to confiscation under relevant sections and imposition of penalties.

2. The appellants contested the notice, arguing that the imports were for reconditioning, repair, and replacement purposes. They were registered with the Director of Industries and had valid licenses for used diesel engines, justifying the declared value.

3. The advocate for the appellant did not press for valuation and confiscation liability but sought a reduction in fine and penalty. The Tribunal did not arrive at findings on valuation due to this stance.

4. The quantum of redemption fine was scrutinized, with the adjudicator imposing a high fine and penalty. The Tribunal disagreed with the Commissioner's finding on the margin of profit, emphasizing the lack of evidence supporting a 100% profit margin.

5. Referring to precedents and similar cases, the Tribunal determined a more reasonable redemption fine of 45% and a penalty of 5% based on market conditions and past judgments. The Tribunal emphasized the need for justifying any departure from established norms in imposing fines.

6. The advocate's submission regarding the acceptance of earlier orders for fine and penalty reduction was considered, leading to the partial allowance of the appeals by reducing the redemption fine to 45% and penalty to 5% of the ascertained value.

7. Ultimately, the appeals were disposed of, partially allowed in line with the revised redemption fine and penalty percentages, reflecting a balanced approach considering the circumstances and market conditions.