2016 (12) TMI 887 - AT - Customs

Confiscation - Determination of DEPB credit - Held that - It would appear that the goods were not available for confiscation at the time of availability of the impugned order. The appellant had already remitted the redemption fine and penalties before export of the goods. Impliedly the goods were allowed to be exported by the proper officer after having complied with the terms of the impugned order. The actual date of receipt of the impugned order by the appellant, relevant only for determining the maintainability of the appeal, is not germane to the present proceedings. Had the goods not been in the custody of the customs authorities, the appellant would not have exercised the option to redeem them on payment of fine. Therefore, there is no miscarriage of justice in confiscating the offending goods - Penalty is imposed as a deterrent to prevent mis-declaration of this nature in future. Considering those circumstances and the value of the goods there is no reason to interfere with the impugned order - appeal dismissed - decided against appellant.

Summary

Issues:
Challenge to re-determination of DEPB credit | Customs officers' power to confiscate and impose penalties on DEPB exports | Validity of confiscation and penalty | Jurisdiction of customs authorities | Imposition of penalty as a deterrent

The judgment by the Appellate Tribunal CESTAT MUMBAI involved the challenge by M/s Rainbow Silks against the re-determination of DEPB credit in six shipping bills. The goods declared as dyed fabrics were found to be embroidered sarees, leading to a reduction in DEPB rates. The appellant initially contested the order, arguing that customs officers lacked the authority to confiscate and penalize DEPB exports. The issue was referred to a Larger Bench, which confirmed the jurisdiction of customs officers to do so. The appeal focused on setting aside the confiscation and penalty, with the appellant claiming that the goods were already exported and not available for confiscation, and the penalty amount was disproportionate.

The Authorized Representative defended the confiscation, citing mis-declaration as the basis for it, and argued that the penalty was reasonable compared to the total value of the goods. The Tribunal noted that the goods were not present for confiscation when the impugned order was issued, as the appellant had already paid the redemption fine and penalties before exporting the goods. The Tribunal emphasized that since the goods were allowed to be exported after complying with the order, confiscating them did not result in a miscarriage of justice.

The penalty was upheld as a deterrent against future mis-declarations, considering the circumstances and the value of the goods. The Tribunal concluded that there was no justification to intervene in the impugned order and dismissed the appeals. The judgment was pronounced on 08/07/2016 by Member (Technical) Shri C J Mathew.

This detailed analysis covers the issues of DEPB credit re-determination, customs officers' power to confiscate and penalize DEPB exports, the validity of confiscation and penalty, the jurisdiction of customs authorities, and the imposition of penalty as a deterrent. The judgment provides a thorough examination of the arguments presented by the parties and the rationale behind upholding the confiscation and penalty in this case.