1991 (12) TMI 157 - AT - Customs

Issues Involved:
1. Dispensation of pre-deposit of penalties and duty.
2. Confiscation of goods under various sections of the Customs Act, 1962.
3. Violation of Import Trade Control Order and Livestock Importation Act.
4. Duty evasion and under-declaration of goods' value.
5. Compliance with customs formalities and transhipment procedures.
6. Constructive control of goods by authorities.
7. Financial hardship and waiver of pre-deposit.

Issue-wise Detailed Analysis:

1. Dispensation of Pre-deposit of Penalties and Duty:
The applicants sought dispensation of the pre-deposit of penalties and duty demanded. The tribunal directed the applicant firm to pre-deposit Rs. 25,00,000 towards duty and Rs. 2,50,000 towards penalty. The Managing Partner was directed to pre-deposit Rs. 1,00,000 towards penalty, and the clearing agent was to pre-deposit Rs. 50,000 towards penalty by 28th February 1992. The pre-deposit of the balance of duty and penalty was dispensed with pending appeals.

2. Confiscation of Goods under Various Sections of the Customs Act, 1962:
The lower authority held that the goods were liable to confiscation under Sections 111(j), 111(d), 111(m), 111(n), 111(g), and 111(h) of the Customs Act, 1962. The goods were removed for home consumption without following customs formalities, cleared without import license, and without observing quarantine formalities. Additionally, the goods were under-declared in value and sent to Bangalore in violation of transhipment procedures.

3. Violation of Import Trade Control Order and Livestock Importation Act:
The goods were cleared without an import license, contravening the Import Trade Control Order 17/551 and the provisions of the Livestock Importation Act, 1898. The tribunal noted that the applicants did not demonstrate any entitlement to import the goods under OGL (Open General License).

4. Duty Evasion and Under-declaration of Goods' Value:
The applicants were found to have under-declared the value of the goods, with the assessable value being significantly higher than declared. The tribunal found no infirmity in the lower authority's order regarding the valuation and duty demand of Rs. 49,38,107.90.

5. Compliance with Customs Formalities and Transhipment Procedures:
The applicants were aware that customs formalities were required but took delivery of the goods without complying with these formalities. The tribunal observed that the applicants did not pursue the matter with higher authorities and took delivery of the goods as domestic cargo, which was not justified.

6. Constructive Control of Goods by Authorities:
The tribunal held that the goods were not under the constructive control of the authorities after the High Court's order, which allowed the applicants to retain possession of the livestock subject to certain conditions. Therefore, the plea that the goods should be considered under the control of the authorities for the purpose of Section 129-E was rejected.

7. Financial Hardship and Waiver of Pre-deposit:
No financial hardship was pleaded by the applicants. The tribunal noted that the applicants enjoyed the benefits of the importation and directed the pre-deposit of specified amounts. Waiver of pre-deposit of penalties was granted for other applicants pending disposal of their appeals.

Conclusion:
The tribunal directed the applicants to pre-deposit specified amounts towards duty and penalties, with the balance pre-deposit dispensed with pending appeals. The matter was scheduled for compliance reporting on 28th February 1992. The tribunal observed that the Departmental authorities had not considered the accruals from the G.P. chicks and their disposal in light of the seizure and High Court's interim order.

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