2012 (6) TMI 614 - AT - Customs

Appeal against reduction of redemption fine and penalty by Commissioner (Appeals) - assessee alleged of violating provisions of Rule 23 of the Drugs and Cosmetics Rules, 1945 - permission to re-export goods stands granted - Held that - Issue stands rejected by the Tribunal in case of same assessee earlier AY wherein it was held that finding of Commissioner that there is no malafide on the part of the importer does not stand rebutted by the Revenue. Need to re-export of the impugned goods arose only because the importer could not get licence from the Drugs Controller of India. There is no dispute that the goods were correctly declared by the by the appellant. Following the earlier decision, we find no infirmity in the impugned order of reducing redemption fine and penalty - Appeal rejected.

Summary

Issues Involved:
Reduction of redemption fine and penalty by Commissioner (Appeals) | Violation of Drugs and Cosmetics Rules, 1945 | Confiscation of impugned goods under section 111(d) of the Customs Act, 1962 | Re-export request and adjudication | Comparison with a previous Tribunal decision

Reduction of Redemption Fine and Penalty:
The Revenue filed an appeal against the order reducing the redemption fine and penalty. The Commissioner (Appeals) had reduced the redemption fine to Rs.25,000/- and penalty to Rs.75,000/-. The Commissioner observed that there was no mis-declaration of goods, and the importer had applied for re-export as they could not obtain the required import license. The Commissioner noted the absence of mens rea and reduced the fine and penalty accordingly. The Tribunal upheld the Commissioner's decision, citing the lack of valid reasons for enhancement provided by the Revenue. The Tribunal emphasized that there was no malafide intent on the part of the importer, and the need for re-export arose due to the unavailability of the required license.

Violation of Drugs and Cosmetics Rules, 1945:
The case involved the import of OFLOXACIN from China, which required specific import licenses as per Rule 23 of the Drugs and Cosmetics Rules, 1945. The appellant was found to have violated Rule 23, leading to the goods not being permitted for import into India. The impugned goods were valued at Rs.42,34,481.37 and were deemed to be imported against the provisions of the Rules, making them liable for confiscation under section 111(d) of the Customs Act, 1962.

Confiscation of Impugned Goods:
Section 111(d) of the Customs Act, 1962 stipulates that goods imported contrary to prohibitions imposed by law are liable for confiscation. In this case, the impugned goods were imported against the provisions of the Drugs and Cosmetics Rules, 1945, making them liable for confiscation under the Customs Act. The adjudicating authority allowed re-export of the goods on payment of a redemption fine of Rs.5 lakhs and a penalty of Rs.2 lakhs, which was later reduced by the Commissioner (Appeals).

Re-export Request and Adjudication:
The respondent requested re-export of the goods, which was allowed by the adjudicating authority on payment of a redemption fine and penalty. The Commissioner (Appeals) further reduced the fine and penalty considering the circumstances, including the lack of deliberate intent to import without the required license and the absence of foreign exchange involvement. The Tribunal, following a previous decision, upheld the reduction of the redemption fine and penalty, ultimately rejecting the Revenue's appeal.

Comparison with Previous Tribunal Decision:
The Tribunal noted a previous decision involving the same issue and parties, where a similar appeal by the Revenue was rejected. In that case, the Tribunal found no malafide intent on the part of the importer and upheld the reduction of the redemption fine and penalty by the Commissioner (Appeals). The Tribunal, in the current case, followed the earlier decision and rejected the Revenue's appeal based on similar grounds.

This comprehensive analysis of the judgment highlights the key issues involved, the legal provisions applied, the decisions of the adjudicating authority, Commissioner (Appeals), and the Tribunal, as well as the reasoning behind the reduction of the redemption fine and penalty in the case.