1998 (3) TMI 459 - AT - Customs

Summary

Issues:
1. Confiscation of imported goods without an import license.
2. Calculation of redemption fine and penalty based on market value and storage deterioration.
3. Determination of margin of profit considering expenses incurred by the appellant.
4. Liability to penalty under Section 112 for importing goods without a license.

Analysis:
1. The case involved three consignments of mace imported by a person who did not exist at the addresses shown. The goods were sold to the appellant, who filed bills of entry after being shown as the importer. The Collector initially confiscated the goods, but the Tribunal set aside the order and directed re-adjudication due to the perishable nature of the goods.

2. The Commissioner, after hearing the appellant, confirmed the confiscation due to lack of an import license. The appellant argued for leniency based on being a genuine purchaser and the deteriorated quality of the goods. The Commissioner determined the redemption fine at Rs. 10.00 lakhs and imposed a penalty of Rs. 1.00 lakh, considering market prices and storage deterioration.

3. The appellant contended that the margin of profit should be based on the market price at the time of import in 1994, citing a newspaper certificate. The Departmental Representative argued for considering prices in 1996 when the bill of entry was filed. The Tribunal emphasized the need to calculate profit based on the prices prevailing at the time of import.

4. The Tribunal acknowledged the expenses incurred by the appellant, such as demurrage and storage costs, but required documentary evidence for substantiation. The matter was remanded to the Commissioner for redetermination of the margin of profit after considering the appellant's expenses and the goods' reduced value due to storage.

5. Regarding the liability to penalty under Section 112, the Tribunal found the appellant knew the goods were liable to confiscation due to lack of a license. However, considering the appellant did not willfully import the goods without a license, the penalty was reduced from Rs. 1 lakh to Rs. 50,000.

6. The Tribunal emphasized the need for prompt adjudication by the Commissioner within two months from the date of the order to avoid delays in the resolution of the case.