2000 (8) TMI 574 - AT - Customs

Summary

Issues:
- Challenge to order confirming duty demand and imposing penalties under Central Excise Act and Customs Act
- Confiscation of goods of foreign origin with redemption option and penalties under Customs Act

Analysis:

Issue 1: Challenge to Duty Demand and Penalties under Central Excise Act
The appellants contested the order confirming duty demand and penalties under the Central Excise Act. The Central Excise officers found the appellants engaged in manufacturing and selling computer sets without necessary registration and formalities. The officers seized computer accessories of foreign origin, leading to the demand of duty and penalties. The appellants argued that they did not manufacture computer sets but assembled components purchased from the market. However, evidence showed the sale of computer sets without registration. The Commissioner upheld the duty demand and penalty, considering the assembly of components as manufacturing. The appellate tribunal agreed with the decision but reduced the penalty to Rs. 10,000, confirming the duty demand of Rs. 86,624.25.

Issue 2: Confiscation of Goods of Foreign Origin under Customs Act
The Department alleged that goods seized from the appellants' premises were liable for confiscation under the Customs Act due to lack of proof of legal import. The appellants claimed that examination would prove the goods were not liable for confiscation. The Commissioner ordered confiscation with a redemption fine of Rs. 20,000 and imposed a penalty of Rs. 10,000. Upon review, the tribunal found that the requirements for confiscation under Section 111 of the Customs Act were not met. The order lacked specifics on the clause invoked for confiscation and did not establish the foreign origin of the goods. As a result, the tribunal set aside the confiscation order and penalties imposed under the Customs Act.

In conclusion, the tribunal partially allowed the appeal by confirming the duty demand under the Central Excise Act but reducing the penalty. It set aside the confiscation of goods and associated penalties under the Customs Act due to insufficient evidence and lack of findings on foreign origin.