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2022 (12) TMI 321 - AT - CustomsDenial of redemption fine in lieu of confiscation of goods - Wilful mis-declaration of imported goods - Low Sulphur Waxy Residue (fuel oil) - violation of of paragraph 2.7 of Foreign Trade Policy 2009-2014 read with Rule 13 (4) or not - Confiscation - levy of penalty u/s 112 (a) of the Customs Act - HELD THAT - The facts are not in dispute. The imported good, declared as low sulphur wax residue fuel oil was on testing, found to be waste oil . Import of waste oil is prohibited under the Rules. The appellant had no licence or permission to import and process waste oil . Therefore, the confiscation of the goods under section 111 (d) and 111 (m) must be upheld as there was not only misdeclaration of the goods but the import itself was in violation of the prohibition under the Rules. Since import of the disputed good was prohibited, the Adjudicating Authority had the discretion to either allow redemption or not. In our considered view, the Adjudicating Authority has correctly exercised its discretion not to allow redemption of hazardous waste to the appellant and the Commissioner (Appeals) has, in the impugned order, correctly upheld it. Section 112 (a) of the Customs Act provides for penalty for acts or omissions which render goods liable to confiscation under Section 111. The amount of penalty imposed is Rs. 1,00,000/- which, is fair and proper considering that the value of the confiscated goods is Rs. 10,98,772/-. Appeal dismissed.
Issues:
1. Import of prohibited goods under the Hazardous Waste Rules. 2. Confiscation of imported goods and imposition of penalties. 3. Request for redemption or re-export of confiscated goods. 4. Interpretation of Sections 125 and 126 of the Customs Act. Analysis: Issue 1: Import of prohibited goods under the Hazardous Waste Rules The appellant imported "Low Sulphur Waxy Residue (fuel oil)" which was identified as "waste oil" under Schedule VI of the Hazardous Waste Rules. The import of this good was prohibited under Rule 13(4). A show cause notice was issued alleging mis-declaration and violation of the Foreign Trade Policy. The Additional Commissioner's order confiscated the waste oil and imposed penalties under the Customs Act. Issue 2: Confiscation of imported goods and imposition of penalties The Commissioner (Appeals) upheld the confiscation but set aside the personal penalty on the Director of the appellant. The appellant did not dispute the prohibition or lack of permission to import the waste oil. The appellant requested release to another entity with the necessary license or re-exportation. The Department argued against release or re-exportation due to confiscation and the serious environmental implications of importing hazardous waste. Issue 3: Request for redemption or re-export of confiscated goods The appellant requested redemption or re-exportation of the waste oil, but the Tribunal noted that on confiscation, the goods vest in the Central Government as per Section 126 of the Customs Act. The Adjudicating Authority correctly exercised discretion in not allowing redemption due to the prohibition on importing hazardous waste. Issue 4: Interpretation of Sections 125 and 126 of the Customs Act The Tribunal clarified that the Adjudicating Authority has the discretion to allow redemption of confiscated goods based on the nature of the goods being imported. Since the disputed goods were prohibited, the Authority correctly chose not to allow redemption. The penalty imposed under Section 112 (a) was deemed appropriate considering the value of the confiscated goods. In conclusion, the Tribunal upheld the impugned order, rejecting the appeal and affirming the confiscation and penalties imposed. The judgment emphasized the seriousness of importing hazardous waste and the legal provisions governing redemption and confiscation under the Customs Act.
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