2023 (9) TMI 417 - AT - Customs

Valuation of imported goods - imported old and used worn clothing, completely fumigated - restricted item or not - classified under Tariff Item No.63090000 or not - enhancement of value - confiscation - redemption fine - penalty - HELD THAT - This issue came up before this Tribunal in the case of VENUS TRADERS, RAINBOW INTERNATIONAL, AL-YASEEN ENTERPRISES, GLOBE INTERNATIONAL, KRISHNA EXPORT CORPORATION, PRECISION IMPEX, BMC SPINNERS PVT. LTD., SHIVAM TRADERS, LEELA WOOLEN MILLS, M.U. TEXTILES VERSUS COMMISSIONER OF CUSTOMS (IMPORTS) MUMBAI 2018 (11) TMI 625 - CESTAT MUMBAI , wherein this Tribunal has observed the paucity of evidence and the negligible scope for ascertainment at this stage deters us from doing so. In the light of the admitted failure to comply with the licensing requirements, we uphold the confiscation of the goods under Section 111(d) of Customs Act, 1962. However, it is our opinion that the ends of justice would be served by reducing the redemption fine to 10% of the ascertained value and penalty to 5%. The redemption fine and penalty imposed on the respondents by the adjudicating authority is sufficient to meet the end of justice - there are no infirmity in the impugned order and the same is sustained - appeal of Revenue dismissed.

Summary

Issues involved:
The issues involved in the judgment are the enhancement of redemption fine and penalty imposed on the respondent for importing old and used worn clothing, the classification of the goods under Tariff Item No.63090000, and the compliance with licensing requirements under the Foreign Trade Policy.

Issue 1: Enhancement of Redemption Fine and Penalty
The Revenue appealed against the impugned order which enhanced the declared value of imported old and used worn clothing and imposed redemption fine and penalty. The Adjudicating Authority had imposed redemption fine and penalty at the rate of 19.5% and 7.8% of the assessed value respectively. The Revenue sought enhancement of these amounts.

Issue 2: Classification of Goods and Licensing Requirements
The goods imported by the respondent were classified under Tariff Item No.63090000, which is a restricted item for import as per the Foreign Trade Policy. Import of goods under this tariff item is allowed only against a valid specific license. The Adjudicating Authority imposed redemption fine and penalty based on the classification and non-compliance with licensing requirements.

Judgment Summary:
The Tribunal considered the arguments and evidence presented by both parties. Referring to a previous case, the Tribunal highlighted that confiscation under Section 111(d) of the Customs Act was justified for importing old and serviceable garments without the required import license. The Tribunal upheld the confiscation but reduced the redemption fine and penalty to 10% and 5% of the ascertained value respectively, in the interest of justice.

The Tribunal noted that the respondents did not challenge the confirmed duties and penalties, hence confirming the redemption fine and penalty imposed by the Adjudicating Authority. Based on a previous decision, the Tribunal concluded that the redemption fine and penalty were sufficient to meet the ends of justice. Therefore, the impugned order was upheld, and the appeals filed by the Revenue were dismissed.

In conclusion, the Tribunal found no infirmity in the impugned order and upheld the redemption fine and penalty confirmed by the Adjudicating Authority, in line with the principles of justice and legal provisions.