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2021 (8) TMI 542 - AT - CustomsLevy of redemption fine and penalty - import of Raw Agarbathies - restricted import or not - HELD THAT - Raw Agarbathies classified under CTH 33074100 became a restricted item for import into India vide Sl. No. III of Notification No. 15/2015-2020 dated 31.08.2019 issued by the Directorate General of Foreign Trade - The invoices raised by the supplier in the case on hand are dated 27.08.2019 and 28.08.2019, which are well within the date of the above Notification, by which time the contract between the importer and the supplier had concluded. There are no mala fides in so far as the import of the goods in question are concerned. Admittedly, the prohibition in question was not in force as on the date of invoice and it is nobody s case that the appellant was aware as to the change in law at the time of signing of the contract or when the invoice was raised in terms of the contract. There are no justification in redemption fine and penalty being imposed on the appellant - appeal allowed - decided in favor of appellant.
Issues:
1. Imposition of redemption fine under Section 125(1) of the Customs Act, 1962. 2. Imposition of penalty under Section 112(a)(i) of the Customs Act, 1962. Analysis: The judgment revolves around the imposition of redemption fine and penalty on the appellant-importer under the Customs Act, 1962. The key issue was whether the Revenue was justified in imposing these sanctions. The facts were undisputed, with "Raw Agarbathies" being classified as a restricted item for import into India. The goods were imported before the prohibition came into force, as evidenced by the invoices dated before the relevant notification. The court found no mala fides on the part of the importer, as they were unaware of the change in law at the time of signing the contract or raising the invoices. The judgment referenced a previous case, M/s. P.T. Impex Pvt. Ltd. v. C.C.E., Delhi-III, where a similar view was supported by the Delhi Bench of the CESTAT and subsequently confirmed by the High Court of Punjab and Haryana. Drawing from this precedent, the court concluded that there was no justification for imposing the redemption fine and penalty on the appellant. Consequently, the impugned order was set aside, and the redemption fine and penalty were deleted. The appeals were allowed, and the order was pronounced in open court on 05.08.2021. In summary, the judgment highlights the importance of considering the timing of import in relation to changes in regulations when determining liability for fines and penalties under the Customs Act, 1962. It emphasizes the need for a lack of mala fides and awareness of legal changes on the part of the importer to avoid unjust sanctions. The decision underscores the significance of legal precedent in shaping judgments related to customs matters and serves as a reminder of the principles governing such cases.
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