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Issues: Reduction of redemption fine to 75% - Consideration of demurrage charges in determining margin of profit - Applicability of case law on cassia to poppy seeds - Challenge to the Commissioner (Appeals) order - Adequacy of redemption fine - Imposition of penalty
Reduction of Redemption Fine to 75%: The appeal was filed against the reduction of redemption fine to 75% by the Commissioner (Appeals). The Revenue argued that the reduction was unwarranted and should have been 292%, claiming that the Commissioner's decision was disproportionate to the offense's magnitude. The Revenue contended that demurrage charges should not be considered in determining the margin of profit, as they are typically paid by importers deliberately disregarding the law to gain profits. The Revenue also challenged the reliance on a Tribunal order related to General Traders, stating that the order was not accepted by the department. Furthermore, the Revenue presented information from various sources to support its claim that the margin of profit was higher than determined by the Commissioner (Appeals). Consideration of Demurrage Charges in Determining Margin of Profit: The Revenue argued that demurrage charges should not be factored into the calculation of the margin of profit, as they are costs incurred by importers deliberately flouting the law to maximize profits. However, the Tribunal disagreed, stating that demurrage charges are part of the import cost and must be considered when determining the margin of profit. Applicability of Case Law on Cassia to Poppy Seeds: The Revenue contended that the case law relied upon by the Commissioner (Appeals) regarding cassia was not applicable to poppy seeds of Pakistani origin. The Revenue emphasized that the margin of profit for a different commodity should not be applied to poppy seeds. The Tribunal agreed with this argument, highlighting the distinction between cassia and poppy seeds in determining the margin of profit and redemption fine. Challenge to the Commissioner (Appeals) Order: The Revenue challenged the Commissioner (Appeals) order, arguing that the decision to reduce the redemption fine and consider demurrage charges was incorrect. The Revenue sought to set aside the order and restore the Additional Commissioner's decision. However, the Tribunal found no grounds to accept the Revenue's appeal, upholding the Commissioner (Appeals) decision on the redemption fine. Adequacy of Redemption Fine: The Advocate for the Respondent argued that based on previous Tribunal orders, the redemption fine for similar imports of poppy seeds should not exceed 85% of the CIF value. The Advocate emphasized that the Commissioner (Appeals) had correctly considered demurrage charges in determining the redemption fine, which would reduce the margin of profit. The Tribunal agreed with this stance and upheld the 75% redemption fine imposed by the Commissioner (Appeals). Imposition of Penalty: Since there was no appeal against the penalty imposed by the Commissioner (Appeals), the Tribunal found no reason to challenge the penalty of Rs. 50,000. The Tribunal concluded that once the penalty was accepted as proper and just, there was no justification to question the imposition of the redemption fine determined by the Commissioner (Appeals). Therefore, the Tribunal rejected the Revenue's appeal, affirming the Commissioner (Appeals) decision on the redemption fine.
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