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2018 (6) TMI 394 - AT - CustomsViolation of condition of N/N. 64/88 dated 1.3.1988 - import of medical equipments - Demand of duty u/s 28(1) of the Customs Act, 1962 - Held that - The demand of duty can be sustained under Section 28(1) of the Customs Act, 1962, which was invoked in the show-cause notice although ignored in the impugned order on account of mis-interpretation of the decision of Hon ble Apex Court in the case of Jagdish Cancer & Research Centre 2001 (8) TMI 113 - SUPREME COURT OF INDIA . The appellants in appeals contended that no market enquiry has been conducted before arriving at the quantum of redemption fine. In these circumstances, we have no option but to set aside the redemption fine imposed and remand the matter to the original adjudicating authority to conduct the necessary market enquiry before quantifying the redemption fine. Penalty of ₹ 10,000/- has been imposed on the main appellant and amount of penalty has been imposed on Dr. S. Krishnamurthy, MD - Held that - Considering the facts of the case that the appellants imported the machine and failed to follow the post importation conditions, the penalty of ₹ 10,000/- imposed is sufficient. Appeal disposed off.
Issues:
Appeal against confiscation of medical equipments, imposition of redemption fine, confirmation of duty under Section 125(2) of the Customs Act, 1962, and imposition of penalties. Detailed Analysis: Issue 1: Confiscation of Medical Equipments The appellants failed to fulfill the conditions of Notification No. 64/88-Cus, leading to the issuance of a notice under Section 28(1) of the Customs Act, 1962. The impugned order confirmed the duty under Section 125(2) of the Customs Act, upholding the confiscation of goods due to the violation of the notification conditions. The decision was influenced by the case of Fortis Hospital Ltd., emphasizing the obligation to pay duty upon non-compliance with notification conditions. Issue 2: Demand of Duty under Section 125(2) vs. Section 28(1) The impugned order confirmed the demand under Section 125(2) instead of Section 28(1), citing an undertaking by the importer to pay duty in case of non-compliance with post-import conditions. However, the decision was based on a misinterpretation of the Supreme Court's ruling in the case of Jagdish Cancer & Research Centre. The Apex Court clarified that the demand of duty can be enforced under Section 28(1) in such cases. Issue 3: Market Enquiry for Redemption Fine The appellants contested the redemption fine without a prior market enquiry. The Tribunal set aside the redemption fine and remanded the matter to the adjudicating authority for conducting a market enquiry to determine the fine accurately. Issue 4: Imposition of Penalties A penalty of &8377;10,000 was imposed on the main appellant, and a separate penalty on Dr. S. Krishnamurthy, MD. Considering the failure to comply with post-import conditions, the Tribunal deemed the penalty of &8377;10,000 sufficient in this case. Conclusion: The demand of duty confirmed under Section 125(2) of the Customs Act, 1962 was modified to confirm under Section 28(1) of the Customs Act, 1962. The Tribunal disposed of the appeals accordingly, emphasizing the importance of compliance with notification conditions and the correct application of legal provisions in such cases.
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