2024 (2) TMI 1266 - AT - Customs

Imposition of redemption fine - import of Limestone Blocks - imported goods not covered by the license - confiscation of goods - penalty - HELD THAT - We observe that the order was placed by the Appellant during the validity of their license wherein out of the total shipments in dispute, Bill of lading bearing No. MSCUS5860867 was issued and the rest within a month of the same time which we observe is close to the lapse of the license of the Appellant. Furthermore, we note that the Appellant have voluntarily updated the adjudicating authority about the said issue. Taking the said facts into consideration we are of the view that the Appellant is a bonafide as they have not suppressed facts relevant in the present case. We also find that in the present case the appellant suffered heavy demurrage due to which the profit of the appellant has also wiped off. Thus, we are of the view that appellant deserve the leniency with regard to quantum of redemption fine and penalty. Accordingly, we reduce the redemption fine and penalty in the matter of Appeal No. C/10327/16 to Rs.25,00,000/- and Rs.4,00,000/- respectively and in Appeal No. C/10623/16 to Rs.20,00,000/- and Rs. 3,00,000/- respectively. The impugned orders are modified to the above extent. Appeals are partly allowed in the above terms.

Summary

Issues involved:
The judgment involves the issue of confiscation of goods under section 111(d) of the Customs Act 1962 with an option to redeem the same upon payment of a fine and penalty under Section 112(a) of the Customs Act 1962 due to delayed import of restricted goods post expiry of the import license.

Details of the judgment:

Issue 1: Consideration of gravity of offense and circumstances before levy of fine and penalty
The Appellant argued that the adjudicating authority did not adequately consider the gravity of the offense, profit margin, and case circumstances before deciding on the redemption fine and penalty. They contended that their working profit was only between 5-10%, supported by their chartered accountants' certification, contrary to the department's projection of 55% profit without detailed working. The Appellant also highlighted heavy demurrage and detention charges incurred due to delayed shipment, which were not factored into the authorities' decision. The Tribunal found the Appellant to be bonafide, having voluntarily updated the authority about the license lapse, and suffering heavy demurrage, leading to wiping off their profit. Relying on relevant case laws, the Tribunal reduced the redemption fine and penalty, considering the Appellant's circumstances.

Issue 2: Reduction of redemption fine and penalty
After careful consideration of submissions from both sides and perusal of records, the Tribunal observed that the Appellant acted within the validity of their license, with most shipments occurring close to the license lapse, voluntarily informing the authority about the issue. Recognizing the Appellant as bonafide and noting the heavy demurrage suffered, the Tribunal decided to reduce the redemption fine and penalty. In Appeal No. C/10327/16, the redemption fine and penalty were reduced to Rs. 25,00,000/- and Rs. 4,00,000/-, respectively. In Appeal No. C/10623/16, the redemption fine and penalty were reduced to Rs. 20,00,000/- and Rs. 3,00,000/-, respectively. The impugned orders were modified accordingly, and the appeals were partly allowed.

( Pronounced in the open court on 26. 02. 2024 )