1999 (9) TMI 205 - AT - Central Excise

Summary

Issues:
1. Import of Used Diesel Engines without necessary license
2. Confiscation and redemption of goods
3. Imposition of fine and penalty

Analysis:

Issue 1: Import of Used Diesel Engines without necessary license
The appellants imported Used Diesel Engines without the required license, leading to confiscation of the engines. The engines were allowed redemption on payment of a fine, while compressors integrated with the engines were held undeclared and subjected to confiscation. The penalty of Rs. 3,00,000 was imposed, leading to the appeal.

Issue 2: Confiscation and redemption of goods
The Additional Collector of Customs determined the quantum of fine based on prevailing market prices and profit margins of Second Hand Diesel Engines. The appellants argued that fines imposed in similar cases ranged between 80% to 135%, and presented evidence of lower fines imposed in comparable situations. The Tribunal noted discrepancies in the fine percentages applied in different cases and reduced the fine from Rs. 18 lakhs to Rs. 5 lakhs for the engines and from Rs. 30,000 to Rs. 10,000 for the compressors.

Issue 3: Imposition of fine and penalty
Regarding the penalty, the appellants contended that previous penalties were around 10%, but the Tribunal observed a higher penalty of about 40% imposed in a recent case. Consequently, the penalty was reduced from Rs. 3,00,000 to Rs. 2,00,000. The Tribunal emphasized the need for consistency in determining fines and penalties, ensuring fairness and avoiding arbitrary variations.

In conclusion, the Tribunal adjusted the quantum of fine for the imported engines and compressors, as well as the penalty, based on comparative analysis and considerations of fairness and consistency in customs adjudication. The appeal was decided in favor of the appellants, reflecting a balanced approach to customs enforcement and penalty imposition.