2018 (6) TMI 393 - AT - Customs

Exemption on goods to be re-exported within stipulated time - Benefit of N/N. 104/94-Cus dated 16.3.1994 - The case of the Department is that 31 containers were re-exported but after the prescribed time period of 2 six months, and the containers were confiscated - Redemption Fine - Penalty - Held that - The containers which were ordered to be confiscated were never seized and released provisionally nor the containers are available for confiscation. In such case, the confiscation of goods and consequent redemption fine cannot be imposed - redemption fine set aside. Penalty - Held that - There is admitted violation of condition of N/N. 104/94-Cus dated 16.3.1994 inasmuch as the appellant did not re-export the containers within six months, therefore, for such violation, the appellant is liable for penalty - penalty imposed but quantum of penalty reduced. Appeal allowed in part.

Summary

Issues:
1. Imposition of redemption fine and penalty for not re-exporting containers within the prescribed time period under Notification No. 104/94-Cus dated 16.3.1994.

Analysis:
The case involved the appellant importing containers in 1996 under an exemption that required re-export within six months. The Department claimed that 31 containers were re-exported after the deadline, leading to the confiscation of 26 containers valued at ?7,80,000/- and 5 containers valued at ?1,60,000/-. Additionally, a penalty of ?1 lakh was imposed. The appellant contested the redemption fine and penalty, arguing that since the confiscated containers were never seized or released provisionally, redemption fine should not apply. The appellant cited relevant judgments to support this argument.

The Tribunal considered the submissions and focused on the issue of redemption fine and penalty. It noted that since the confiscated containers were neither seized nor available for confiscation, the redemption fine could not be imposed. This decision aligned with a previous ruling by the Larger Bench of the Tribunal in the case of Shiv Kripa Ispat Pvt. Ltd. The Tribunal set aside the redemption fine based on this reasoning.

Regarding the penalty, the Tribunal acknowledged the violation of the re-export condition under the notification. Despite this violation, considering the overall circumstances, the penalty was reduced from ?1 lakh to ?50,000. The Tribunal's decision reflected a balance between acknowledging the violation and mitigating the penalty amount based on the case specifics.

Ultimately, the appeal was disposed of with the redemption fine set aside and the penalty reduced to ?50,000. The judgment was pronounced on 11.05.2018 by the Tribunal members Shri Ramesh Nair and Shri Raju.