2024 (9) TMI 468 - AT - Customs

Enhancement of redemption fine and penalty - Valuation of imported goods - imported old and used worn clothing, completely fumigated - restricted item or not - 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 appellate authority is sufficient to meet the ends of justice. Therefore, the redemption fine and penalty confirmed by the appellate authority are upheld. There are no infirmity in the impugned order and the same is upheld - appeal of Revenue dismissed.

Summary

Issues:
Appeal against impugned order regarding import of old and used worn clothing, value enhancement, confiscation, redemption fine, and penalty. Enhancement of redemption fine and penalty sought by Revenue. Interpretation of relevant provisions of Customs Act, 1962, Foreign Trade Policy 2015-2020, and Handbook of Procedures (HBP).

Analysis:

1. Value Enhancement and Imposition of Redemption Fine and Penalty:
The case involved the import of old and used worn clothing, which was fumigated and assessed after value enhancement. The declared value was increased, and redemption fine and penalty were imposed due to classification under a restricted tariff item. The Appellate Authority reduced the redemption fine and penalty percentages from those imposed by the adjudicating authority. The Revenue appealed for further enhancement of these amounts.

2. Legal Interpretation of Customs Act and Foreign Trade Policy:
The Tribunal referred to a previous case where it was observed that invoking Section 111(m) for goods not corresponding in value with the entry made is not in conformity with law if the declaration is absent. Confiscation under Section 111(d) was justified for importing items without the required license as per the Foreign Trade Policy. The Tribunal upheld the confiscation but reduced the redemption fine and penalty percentages based on the ends of justice.

3. Tribunal's Decision and Upholding of Appellate Authority's Order:
The Tribunal, following the precedent, upheld the redemption fine and penalty imposed by the appellate authority, deeming it sufficient to meet the ends of justice. Despite no appeal by the Respondent against the confirmed duties and fines, the Tribunal dismissed the Revenue's appeals, finding no infirmity in the impugned order.

In conclusion, the Tribunal dismissed the Revenue's appeals, upholding the appellate authority's decision on redemption fine and penalty. The judgment focused on the legal interpretation of relevant provisions and previous case law to determine the appropriate penalties in the case of imported old and used worn clothing.