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TMI Blog2024 (11) TMI 750X X X X Extracts X X X X X X X X Extracts X X X X ..... Sea Shore Logistics, SEZ Mundra, upon the examination of goods imported in 7 containers, the quantity of the PCB were found to be 276525 as against declared quantity of 296251. 1.1 It was also noted that maximum number of PCBs were old and used, also a number of packages and sheets were having marking as rejected and/or containing 'X' mark as a sign of being rejected. It was noticed that many packages were having slips containing date/ year of manufacturing as 2009, 2010, 2013 etc. The PCBs were having marking of M/s Genus or M/s Philips. The officers also drew representative samples from the consignment as the goods appear to be old and used and the appellant had declared the value of the entire consignment as Rs.184,25,76,231/-. The services of chartered engineers and government approved valuer M/s. B. G. Bhatt & Co. Ahmedabad were taken to ascertain approximate value of subject consignment. The chartered engineer vide report dated 08.10.2022 reported that estimated C & F value of the consignments as Rs.18.67 Crores, therefore, it appears that the appellant had mis-declared the goods with respect to description and value of goods and accordingly, the goods were liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not specify any amount of Bank Guarantee or Security Deposit. The Circular refers to only securing the interest of the revenue in case of dutiable goods, in such situation the differential duty leviable is required to be taken into consideration. In the present case, since the goods were imported by the SEZ and the same is to be exported, no duty involvement is there, therefore the question of any revenue interest is not involved. He further submits that the entire basis of seizure of the goods is Chartered Engineer certificate wherein, Chartered Engineer found that the 5% goods are rejected. He submits that there is no evidence of arriving at the conclusion by the Chartered Engineer, therefore, only on the basis of the Chartered Engineer certificate, goods are not liable for seizure. He submits that since the goods are meant for export from SEZ, question of confiscation, redemption fine, penalty does not arise. He placed reliance on the following judgments:- Hazel Mercantile Ltd vs. Commissioner of Custom, Kandla 2022 (379) E.L.T. 357 (Tri.-Ahmd.) SankarPandi vs. Union of India 2002 (141) E.L.T. 635 (Mad.) Selvam Industries Ltd vs. Commissioner of Customs, Tuticorin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he orders passed directing the petitioner to pay penalty regarding payment of redemption value for the articles which are brought from Singapore. Subsequently, the petitioner contended that he is no longer interested to take return for the purpose of use or consumption within India, but he wanted to re-export the same. Therefore, he prayed that he need not pay any redemption value. No order has been passed in the revision petition where such prayer has been made. Hence, the present Writ Petition has been filed. 3.It appears that the question relating to re-export is covered by the decision of the Supreme Court rendered in the case of Siemens Limited v. Collector of Customs reported in S.C. 1999 (113) E.L.T. 776. Keeping in view the abovesaid decision there cannot be any doubt that the petitioner is entitled to re-export the articles in question and for the abovesaid purpose, it is not necessary for him to pay redemption fine as imposed by the authorities. 4.The learned Counsel for the petitioner further submitted that since the petitioner is not going to import the articles and use or sell the articles within India, the imposition of penalty of Rs. 33,000/- should be quashed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e penalty from Rs. 2 lakhs to Rs. 1,00,000/- (Rupees one lakh only). The appeal is partly allowed in the above terms." In the case of M/s. Simplex Engineers & Traders Final Order No.41581/2019 dated 26.11.2019, by the CESTAT Chennai bench following order was passed: "5. The first issue is with regard to the redemption fine imposed. The appellant is willing to re-export the goods and is not contesting the order passed directing the appellant to re-export the goods. The Hon'ble Apex Court in the case relied upon by the ld. counsel for appellant has affirmed the decision of the Hon'ble High Court wherein it was held that redemption fine cannot be imposed when the goods have to be redeemed only for the purpose of export. Following the said decision, I am of the view that the redemption fine imposed is unjustified and requires to be set aside, which I hereby do. 6. The second issue is with regard to the penalty imposed. Ld. counsel has adverted to the contract entered into between the appellant and the overseas supplier to argue that there was no intention to import goods which do not conform to the FSSAI Regulations. However, the appellant ought to have made all efforts to impor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges payable in respect of such goods.] [(3) Where the fine imposed under sub-section (1) is not paid within a period of one hundred and twenty days from the date of option given thereunder, such option shall become void, unless an appeal against such order is pending. Explanation. - For removal of doubts, it is hereby declared that in cases where an order under sub-section (1) has been passed before the date on which the Finance Bill, 2018 receives the assent of the President and no appeal is pending against such order as on that date, the option under said sub-section may be exercised within a period of one hundred and twenty days from the date on which such assent is received." 7.2.1 Clearly, as the heading itself points out, the fine i.e., redemption fine, is an option in lieu of confiscation and hence, both cannot run simultaneously, which means redemption fine is leviable only as an alternative to confiscation. The appellant here in this case has not questioned the confiscation and hence, there is no option available to it. Consequently, there is no questio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion has thereafter been upheld by the Hon'ble Apex Court, as reported in 2018 (360) E.L.T. A214 (S.C.), wherein similar penalty has been upheld. 8.3 But however, considering the facts and circumstances of this case and the undisputed bona fides of the appellant, the penalty under Section 112 (a) is reduced to Rs. 10,000/- only. The impugned order of the First Appellate Authority on the penalty under Section 112 (a) is therefore modified to this extent. 9. In the result: (i) The impugned order as regards the redemption fine is set aside; (ii) The impugned order as regards the penalty under Section 112 (a) is modified to the extent as indicated above; 10. The appeal is partly allowed." In case of Lalkamal Enterprises, the division bench of Chennai CESTAT passed the following order:- "5.1 The main contention of the department is that the imported goods have been misdeclared as copper scrap, lead scrap and insulated material whereas they are actually "Copper Wire Scrap with PVC sheathing of Druid grade" which can be imported without a license only by the units registered with the Ministry of Environment and Forests but the importer herein does not possess such licens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Bill of Entry, all the other documents including those required under Hazardous Wastes Rules were furnished at the time of import. Nonetheless, we find that Lalkamal, the High sea buyer, M/s. Sterling Steels, the original importer will surely require a rap on the knuckles at least for the wrong declaration in the Bill of Entry. However, the penalties imposed on these persons under Section 112(a) of the Customs Act, 1962 of Rs. 2 lakhs each, in our view, is excessive and interest of justice would be served by reducing the penalties on them to Rs. 1,00,000/- (Rupees one lakh only). So ordered. We further note that the penalties on the other appellants Vimal Kumar, Asif Rehman cannot be sustained since they are proprietors of Sri Lalkamal Enterprises and Sterling Steels respectively and it is settled law that both proprietor and the proprietaryship firm cannot be penalized in such matters. Hence penalties imposed on these persons are set aside. 5.4 Appellant Shri Abdul Saleem has been indicated as friend of Shri Asif Rehman, Proprietor of Sterling Steel who had allegedly arranged import consignment from Qatar. In our view, the said appellant was only in the nature of a broker or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... primary adjudicating authority that no foul play was suspected, let alone established, by him. Indeed, the facts and circumstances of the case clearly point towards the absence of any mala fide on the part of the appellants. We find that that CESTAT in similar circumstances has held repeatedly that for allowing re-export, RF and penalties are not warranted as is evident from the following judgments : (a) Simens Public Communication Networks Ltd. v. C.C. (Airport), Calcutta - 2001 (137) E.L.T. 623 (Tri.-Kolkata). (b) Guru Ispat Ltd. v. C.C (Port), Calcutta - 2003 (151) E.L.T. 384 (Tri.-Kolkata). (c) HCL Comnet Systems & Services Ltd. v. C.C., New Delhi - 2003 (158) E.L.T. 349 (Tri.-Del.). Our attention was also drawn to the Circular of the Board No. 100/2003, dated 28-11-2003 wherein the C.B.E. & C. has observed that in case of wrong shipments where no mala fide is suspected reexport may be allowed on payment of a nominal penalty or without penalty. The judgment of CESTAT in the case of Authentic Impex v. C.C. (General), Mumbai (supra) cited by the ld. AR for Revenue is related to the import of goods which required import licence and therefore has no applicability with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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