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TMI Blog2024 (12) TMI 1471X X X X Extracts X X X X X X X X Extracts X X X X ..... h order has been filed by the department. The said fact has not been disputed by the learned AR for Revenue as well. The payment of redemption fine and penalty were made under protest and as such, the right of the appellants to file the present appeal cannot be disputed or questioned by the department. Imposition of redemption fine - HELD THAT:- The issue regarding imposition of redemption fine on re-exportation of the goods is settled by the judgement of Hon ble Supreme Court in the case of Siemens Ltd Vs. Collector of Customs [ 1999 (8) TMI 84 - SUPREME COURT ], wherein the imposition of redemption fine by the department was set aside, holding that in case of re-exportation of goods, neither the redemption fine nor the duty is required to be paid and accordingly, ordered for refunding the redemption fine paid by the importer-appellants therein - the Hon ble Supreme Court have dealt with the issue relating to the same notification and similar set of facts, as involved in the present appeal. However, the only difference being that while we appreciate the submissions of the appellants that the said findings are importer specific, it cannot be lost sight of the fact that the redempti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Writ Petitions were filed by the importer viz., being Nos. 9321 of 2018 and 13392 of 2019 before the Hon ble High Court of Rajasthan, challenging various notifications issued by the Directorate General of Foreign Trade ( DGFT ), as under: (i) Notifications No. 04/2015-2020 and 05/2015-20, both dated 25.04.2018, which had revised the Import policy of Peas falling under CTH 07131000 from free to restricted ; (ii) Notification dated 02.07.2018 read with 31/2015-20 and notification no. 32/2015-20 dated 30.08.2018, wherein the import policy of Yellow beans, Green beans, Dun Peas and Kapse Peas were amended from free to restricted till30.09.2018; (iii)Notification No. 37 /2015-2020 dated 28.09.2018, which had extended the restriction on import of these items upto 31.12.2018, which was further extended upto 31.03.2019 vide notification S.O 6364 (E) dated 28.12.2018; (iv) Notifications dated 29.03.2019 bearing S.O. No. 1478-E, 1479-E,1480-E and 1481-E further extended restriction on import of Peas and Pulses covered under various Customs Tariff Heading; (v) Notification No. 37/2015-20 dated 18.12.2019 which subjected import of peas to an annual (fiscal quota) quota of 1.5 lakh MT as per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon ble Supreme Court. 2.8 Pursuant to the Hon ble Supreme Court s Order dated 17.06.2021, the importer had made a representation dated 22.06.2021, requesting the customs authorities to allow them to reexport 12,929.70 MTs of Black Matpe, which were pending clearance since December 2019. The importer had also requested for re-export of 480 MTs of goods, wherein a Bill of Entry was filed in December 2019, but were purged in Customs EDI system. 2.9 Thereafter, the Hon ble Bombay High Court in Writ Petition No. 2504 of 2021 vide Order dated 08.07.2021, had disposed of the petition, by directing the Additional Commissioner of Customs, Appraising Group I IA, Nhava Sheva-I, Jawaharlal Nehru Customs House to decide the aforesaid representation filed by the importer seeking re-export of goods. 2.10 Meanwhile, the appellants, being the unpaid seller had also filed a representation vide letter dated 05.08.2021, requesting for re-export of the goods, pending clearance on the basis of the Tripartite Agreement and the Hon ble Supreme Court s judgment in the case of Union of India v. M/s. Raj Grow Impex LLP and Ors. in Civil Appeal No(s). 2217-2218 of 2021 arising out of the SLP (C) 14633-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the unpaid seller and the said fact has been accepted by the Commissioner (Appeals) in the impugned order as well. It was submitted that the aforesaid finding of the Commissioner (Appeals) has been accepted by the Department and hence the same has attained finality. (iii) The recovery of fine and penalty on re-export of goods from the appellants are bad in law, as they were the unpaid seller in respect of such goods. It was submitted that both the Orders passed by the respective lower authorities, have not recorded any specific findings to the extent that the appellant (un paid seller) had contravened any provisions of the Act of 1962, or were in any manner involved in the alleged improper importation of the goods. It was further submitted that it is not the case of the department that the appellants had derived any benefit from the alleged improper import of the goods. Furthermore, the finding of the Hon ble Supreme Court in the case of Raj Grow Impex LLP (supra) are in relation to importers, who were involved in import of goods. The said findings cannot be applied to an unpaid seller. It is a trite law that once the assessee is entitled to re-export the articles in question, then ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the learned Commissioner (Appeals). Further, in response to the query from the Bench, as to whether, the findings of the learned Commissioner (Appeals) regarding locus of the appellants to file the appeal has been accepted by the Department, he has stated in affirmative, stating that the same has been accepted. 5. We have heard both sides and examined the case records. The questions involved in the present appeal, for consideration before the Tribunal are as under: (i) Can the Redemption fine be recovered from an unpaid seller, for re-exporting the goods, without any contravention having been committed by them under the Act of 1962? (ii) whether Redemption fine is imposable in the facts and circumstances of the present case, and, if the answer is in the affirmative, then can it be said that the fine imposed by the authorities below, is excessive and arbitrary? (iii) whether the action on the part of the Customs department is justified for recovery of the penalty amount from the unpaid seller, on whom the same was not imposed under the provisions of the Act of 1962? 6. Before addressing the questions framed as above, we would like to refer to the adjudication order dated 16.08 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid observations of the original authority, that while the redemption fine of Rs. 3 crores has been imposed for contravention of Section 111 (d) of the Act of 1962 for redeeming the goods, penalty has been imposed specifically against M/s. Agricas LLP. In other words, while penalty has been recovered from the appellants on behalf of the unpaid seller, the same was never imposed upon them. 8. Admittedly, Notifications Nos. 04/2015-2020 and 05/2015-20, both dated 25.04.2018 were issued by the DGFT, revising the import policy for import of various dals, peas, beans, pulses, which amended the import policy from free to restricted . The validity of the said notifications were extended from time to time. The present appeal is filed by M/s. V3 Agencies, who are the agents of M/s. Arvee International Pte. Ltd., who are one of the largest exporters of beans and pulses and unpaid seller in the present case. M/s. Arvee International Pte. Ltd. had entered into the contacts with M/s. Agricas LLP for sell of black matpe on CFR basis. A writ petition was filed by the importer before the Hon ble Rajasthan High Court challenging the vires of the aforesaid Notifications, amending the impor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n payment of fine. It is also logical to hold in light of order in Sampat Raj Duggar case supra that if the payment for goods have not been done by the importer, the title post redemption of goods would have to be treated with the supplier. Thus, once redemption of the offending goods is allowed for reexport on payment of fine, the supplier can put forth their claim for re-export of goods to them on ground of non-payment by the importer as per terms of tripartite contract between the supplier and importer. I therefore hold that once the goods are allowed for redemption for re-export the importer and supplier may follow the terms of contract between them and request for reshipment back to supplier M/s Arvee. Also if the re-export is done through third party it shall be permitted subject to non availment of any export benefit and compliance with other law as may be applicable. 10. It is clear from the aforesaid observations of the original authority that the unpaid seller s application for re-export has been allowed by him and the said fact has been accepted by the department, which is evident that no appeal against such order has been filed by the department. The said fact has not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or contravention of any of the provisions contained in the Act of 1962. 14. On the issue raised by the learned AR with regard to the right of the appellants to file the present appeal in view of voluntary payment of the redemption fine and penalty, we find that the said submission is contrary to the declaration made by the appellants in their letter dated 02.09.2021, which reads as under: V3 Agencies Pvt Ltd has paid redemption fine and penalty as mentioned in Part A of the above OIO on our behalf as follows: a) Redemption fine Rs 3,00,00,000/- pay order No. 051063 dated 26.08.2021, HCM No. 223 dated 2nd September 2021 b) Penalty Rs 1,45,00,000/- pay order No. 051064 dated 26.08.2021 HCM No. 224 dated 2nd September 2021 Please note that we are paying redemption fine and penalty under protest and reserve our right to appeal for reduction/waiver of redemption fine and penalty. 15. The said letter clearly records that the payment of redemption fine and penalty were made under protest and as such, the right of the appellants to file the present appeal cannot be disputed or questioned by the department. 16. The issue regarding imposition of redemption fine on re-exportation of the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scretion ought to be exercised in these matters. When personal business interests of importers clash with public interest, the former has to, obviously, give way to the latter. Further, not a lengthy discussion is required to say that, if excessive improperly imported peas/pulses are allowed to enter the country's market, the entire purpose of the notifications would be defeated. The discretion in the cases of present nature, involving far-reaching impact on national economy, cannot be exercised only with reference to the hardship suggested by the importers, who had made such improper imports only for personal gains. The imports in question suffer from the vices of breach of law as also lack of bona fide and the only proper exercise of discretion would be of absolute confiscation and ensuring that these tainted goods do not enter Indian markets. Imposition of penalty on such importers; and rather heavier penalty on those who have been able to get some part of goods released is, obviously, warranted. .. ... 96. For what has been discussed hereinabove, these appeals deserve to be allowed and, while setting aside the orders passed by the High Court and approving the orders-in-appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... findings of the Hon ble Supreme Court are importer specific, as none of the exporter and/or unpaid seller was before the Hon ble Court. Accordingly, as far as the present appellants are concerned, the facts of the case are relevant to determine whether imposition of redemption fine was warranted, and if yes, what would be the quantum of the same. 19. We also find that the Hon ble Supreme Court have dealt with the issue relating to the same notification and similar set of facts, as involved in the present appeal. However, the only difference being that while we appreciate the submissions of the appellants that the said findings are importer specific, we cannot lose sight of the fact that the redemption fine has been imposed on redeeming the offending goods under Section 125 of the Act of 1962. 20. We are in agreement with the submissions of the appellants that the unpaid seller has not contravened any provisions of the Act of 1962, which have rendered the goods liable for confiscation. The said argument of the appellants has been accepted by the learned AR as well and rightly so, as the adjudicating authority in the original order has held that the importer itself had not gained any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 1962. The aforesaid letter dated 02.09.2021 which was submitted during the hearing, clearly records that the amount towards penalty was paid under protest by the unpaid seller. It is also important to note that in terms of the direction of the Hon ble Supreme Court in the case of Raj grow Impex (supra), the parties had to file an application for re-export of goods within two weeks from the date of order. 24. Given the above facts, while we find merits in the contention of the appellants that they were constrained to deposit the amount of penalty, despite the fact that no penalty was imposed on them, but we are unable to entertain the plea of refund of penalty due to want of jurisdiction, as the appropriate forum to seek refund of amount wrongly collected is not at the Tribunal s end. Accordingly, liberty is granted to the appellants to approach the appropriate Court/Statutory authority(s), for seeking necessary remedy, if they so desire. Further, the department is also left with the option for recovering the penalty amount from M/s Agricas LLP, who is the importer of the impugned goods. 25. In view of the foregoing discussion and analysis, the impugned order dated 26.04.2023 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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