9911796707
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Issues:
1. Classification of imported goods under Customs Act, 1962. 2. Confiscation and penalty imposed under Sections 111(d) and 112(a) of the Customs Act. 3. Dispute over the correct classification of goods imported. 4. Intent to evade duty or mis-declare goods. 5. Quantum of redemption fine and penalties imposed. 6. Consideration of mens rea in imposing penalties. Analysis: 1. The judgment deals with the classification of imported goods under the Customs Act, 1962. The appellants imported shrimp feed declared under two Bills of Entry. The impugned goods were found to be "Brine Shrimp Eggs" (Artemia Cysts) instead of shrimp feed, leading to a dispute over the correct classification. 2. Confiscation and penalties were imposed under Sections 111(d) and 112(a) of the Customs Act. The Order-in-Original confiscated goods under Section 111(d) and imposed penalties. The appellants contested the penalties, arguing that there was no intent to evade duty or mis-declare goods, as they provided technical literature and invoices. 3. The disagreement centered on the classification of the imported goods. The department classified the item under Heading 05.11 as animal products unfit for human consumption, while the appellants believed it should fall under Heading 2309.90 as a preparation for animal feeding. The department rejected the appellants' classification. 4. The issue of intent to evade duty or mis-declare goods was raised. The appellants maintained they had no such intent, as they believed the goods were for animal feeding purposes. The department, however, argued that any mis-declaration in the Bill of Entry warranted confiscation and penalties. 5. The quantum of redemption fine and penalties imposed was scrutinized. The tribunal considered the technical nature of the imported product, the absence of intent for normal trading profits, and the ultimate use for feeding prawns. The tribunal reduced the redemption fine from Rs. 1,00,000 to Rs. 25,000 based on these considerations. 6. Mens rea was a crucial factor in determining penalties. The tribunal found that mens rea was not fully established on the part of the importers. Citing a Supreme Court judgment, the tribunal concluded that penalties under Section 112 of the Customs Act could not be imposed due to the lack of clear mens rea. The tribunal also emphasized that heavy fines were unwarranted in the circumstances. In conclusion, the judgment modified the Order-in-Appeal and the Order-in-Original, partially succeeding the appeals by reducing the redemption fine and emphasizing the importance of mens rea in imposing penalties under the Customs Act.
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