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Issues Involved:
1. Confiscation of goods under Section 111(d) and (m) of the Customs Act, 1962. 2. Imposition of penalty under Section 112 of the Customs Act, 1962. 3. Legitimacy of re-export of goods. Analysis: 1. Confiscation of Goods under Section 111(d) and (m) of the Customs Act, 1962: - Section 111(d): The Commissioner ordered confiscation of the goods under Section 111(d) despite no notice being issued for this specific section. It was noted that the goods were not prohibited under the Exim Policy, and no reasons were provided by the adjudicator for invoking this section. Therefore, the confiscation under Section 111(d) was not upheld. - Section 111(m): This section pertains to goods that do not correspond in value or particulars with the entry made under the Act. The term "entry" as defined under Section 2(16) of the Customs Act refers to entries made in a Bill of Entry, shipping bill, or bill of export. Since no Bill of Entry was filed, the provisions of Section 111(m) were not applicable. The Tribunal referenced the Apex Court's decision in Sampat Raj Dugar, which allowed reshipment of goods when the title of ownership was clear and there was no Bill of Entry filed. Consequently, the confiscation under Section 111(m) was also not sustained. 2. Imposition of Penalty under Section 112 of the Customs Act, 1962: - The Commissioner imposed a penalty on the appellants under Section 112, which was contested. Since the confiscation under Sections 111(d) and (m) was not upheld, the basis for penal action under Section 112 was also invalidated. The Tribunal emphasized that without a valid confiscation order, penalties under Section 112 could not be imposed. 3. Legitimacy of Re-Export of Goods: - The appellants requested permission to re-export the goods, asserting their ownership. The Tribunal noted that the appellants' title to the goods was not in doubt. The case of Pacific International Traders was cited, where re-export was permitted under similar circumstances. The Tribunal concluded that the appellants should be allowed to re-export the goods, as there was no prohibition on the import of the actual goods, and the misdeclaration did not justify confiscation or penalties. Separate Judgments: - Majority Opinion (S.S. Sekhon, Member (T) and Jyoti Balasundaram, Member (J)): The majority held that the confiscation under Sections 111(d) and (m) was not sustainable and that the appellants were entitled to re-export the goods. They concluded that no penalties under Section 112 should be imposed, aligning with the precedent set by the Supreme Court in Sampat Raj Dugar and Northern Plastics. - Dissenting Opinion (Krishna Kumar, Member (J)): Member (J) Krishna Kumar opined that the misdeclaration in the Bill of Lading, invoice, and manifest rendered the goods liable to confiscation under Section 111, and consequently, the appellants were liable for penalties under Section 112. He disagreed with the majority's view on the non-applicability of Section 111(m) and the legitimacy of re-export without penalties. Final Order: - Based on the majority opinion, the appeal was allowed, the order of confiscation was set aside, and the appellants were permitted to re-export the goods. The penalties imposed under Section 112 were also annulled.
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