2020 (2) TMI 8 - AT - Customs

Re-export of imported goods - low Aromatic White Spirit - grant of authorization from DGFT for import of the impugned goods - HELD THAT - The Original Adjudicating Authority has ordered to redeem the goods and re-export the same. Further, the goods were confiscated for violation of the provisions of the Customs Act read with Foreign Trade Policy. The Foreign Trade Policy has not provided for restriction by any other importers than State Trading Enterprises to import the same. As per the policy, after getting an authorization from DGFT persons other than State Trade Enterprises can import the impugned goods. There has been a violation of such none production of authorization from DGFT. The order to re-export the same is not sustainable - that part of the impugned order through which the impugned goods were ordered to be re exported after redemption is set aside - clearance of the impugned goods for home consumption on the payment of redemption fine ordered through the impugned orders along with customs duties required to be paid is allowed - all personal penalties set aside. Appeal allowed in part.

Summary

Issues:
Import of goods without authorization from DGFT, violation of Foreign Trade Policy, confiscation of goods, redemption fine, re-export order, personal penalties.

Analysis:
The case involved three appeals concerning the import of goods declared as 'low Aromatic White Spirit' and 'Industrial Composite Mixture' without obtaining authorization from DGFT. The goods were tested and found to meet the requirements of Kerosine as per I.S.1459:2018, leading the revenue to believe they could only be imported by State Trading Enterprises. The Original Adjudicating Authority confiscated the goods, imposed a redemption fine, and ordered re-export, along with personal penalties.

The appellant argued that they were willing to pay the redemption fine as they had violated the provision of the Foreign Trade Policy by not obtaining authorization from DGFT. The revenue supported the Adjudicating Authority's decision based on the lack of authorization.

Upon review, the Tribunal found that the Foreign Trade Policy allows persons other than State Trading Enterprises to import the goods after obtaining authorization from DGFT. Since there was no specific restriction on other importers, the Tribunal held that the failure to produce authorization from DGFT constituted a violation. Consequently, the order for re-export was deemed unsustainable. The Tribunal set aside the re-export order, allowing clearance of the goods for home consumption upon payment of the redemption fine and customs duties. Additionally, all personal penalties imposed were also set aside.

In conclusion, the Tribunal partially allowed the appeals by overturning the re-export order, clearing the goods for home consumption upon payment of fines and duties, and nullifying the personal penalties.