Customs, Excise and Gold Tribunal - Bangalore
Sunrise Impex, R.A. Spinning Mills (P) ... vs Cc on 24 January, 2003
Equivalent citations: 2003(162)ELT474(TRI-BANG)
JUDGMENT K.K. Usha, J.
1. These appeals are at the instance of importers of old synthetic rags. They claimed clearance without licence under Para 5.3 (a) (iv) of Hand Book of Procedure Vol. I to Exim Policy 1997-2002. The above provision permitted import of Synthetic Rags/Woollen Rags/Shoddy Wool without licence subject to the condition that the mutilation conforms to the requirements specified by the Customs Authorities. On examination of the goods it was found that the mutilation did not conform to the norms specified through the Public Notice No. 86/94 issued by the Customs House. The importers were direct to mutilate the goods further as per Public Notice 86/94. Since they refuse to do so the Customs Authorities proceeded to confiscate the goods under Section 111(d) of the Customs Act, 1962 read with Section 3 of Foreign Trade (Development & Regulation) Act, 1992. It was also proposed to impose penalty under Section 112(a) of the Customs Act. Show cause notices were issued. Ultimately after protracted proceedings before the High Court and Supreme Court the adjudicating authority passed the impugned orders dated 6.8.1999 and 4.9.2000. The goods were ordered to be confiscated and the importers were granted an option to redeem the goods on payment of fine after mutilation of the goods by the importer at his own cost in terms of Public Notice No. 86/94. Penalty was also imposed under Section 112faJ of the Customs Act.
2. In these appeals challenging the adjudication order several contentions were taken. But, at the time of hearing Learned Counsel appearing on behalf of the appellants submitted that the appellants are restricting their contentions to those directed against the quantum of redemption fine and penalty. In view of the above submission, we are not going into the other contentions raised in these appeals. The value of the goods ordered to be confiscated, quantum of redemption fine and penalty imposed in each case are given below in the form of a chart.
S.No. Appeal No. Value of Goods confiscated Redemption Fine Penalty (1) C/447/99 2,29,131 6,00,000 1,15,000 (2) C/448/99 2,52,161 7,00,000 1,25,000 (3) C/449/99 2,73,635 7,00,000 70,000 (4) C/450/99 2,53,290 7,00,000 1,25,000 (5) C/451/99 5,34,576 14,00,000 1,40,000 (6) C/452/99 2,48,289 7,00,000 1,20,000 (7) C/453/99 3,23,700 8,00,000 1,60,000 (8) C/454/99 3,30,895 8,50,000 90,000 (9) C/455/99 2,27,079 6,00,000 60,000 (10) C/456/99 2,26,402 6,00,000 1,20,000 (11) C/13/2000 21,74,012 6,00,000 1,00,000 Learned Counsel appearing on behalf of the appellant contended that the quantum of redemption fine and penalty imposed in each case is unreasonably high. In support of the above contention he placed reliance on certain orders passed by this Tribunal as well as Commissioner of Customs under similar circumstances including the very same Commissioner who passed the impugned orders. In Final Order Nos. 1574-75/99-A dated 5.11.99 disposing of Appeal No. C/70 and 253/99-A (U. Prints v. CC, Cochin), this Tribunal had occasion to consider similar contention. In that case, the imported goods were declared as pre-mutilated old synthetic/woollen rags. However, on examination of the consignment it was found that part of the goods were serviceable garments. Value of the total consignment covered by Appeal No. C/70/99-A was approximately Rs. 26 lakhs. Out of the above goods valued at Rs. 15 lakhs were found to be not tallying with the declaration. But the entire consignment was confiscated with a redemption line of Rs. 2.5 lakhs and penalty of Rs. 1.5 lakhs. The Tribunal reduced the redemption fine to Rs. 1.5 lakhs and penalty to Rs. 1 lakh. In Appeal No. C/253/99-A the entire consignment valued at Rs. 22 lakhs was confiscated with a redemption fine of Rs. 2.5 lakhs and a penalty of Rs. 1.5 lakhs. The offending goods was assessed at Rs. 12 lakhs. The Tribunal therefore reduced the redemption fine to Rs. 1.2 lakhs and penalty to Rs. 1 lakh. While arriving at the above decision, the Tribunal followed its own earlier order (Final Order No. 1256/99-A dated 31.8.99). The learned Counsel points out that the redemption fine upheld by this Tribunal would come to about 10% of the value of the offending goods. Reference is also made to order dated 26.10.98 passed by the very same Commissioner of Customs who had passed the impugned orders, In the above case, the value of the impugned goods was about Rs. 22.15 lakhs. Redemption fine imposed was only Rs. 2.5 lakhs and penalty Rs. 1.5 lakhs.
3. In another order dated 25.4.2001 passed by the Additional Commissioner of Customs, Cochin where the value of similar offending goods was about Rs. 6.1 lakhs the redemption fine imposed was Rs. 65,000 and penalty Rs. 13,000. The same officer had passed another order dated 25.4.2001 where value of the similar offending goods was assessed at Rs. 4.55 lakhs. Redemption fine imposed was Rs. 50.000 and penalty Rs. 10,000. In the light of the above, the learned Counsel for the appellant submits that the quantum of redemption fine and penalty should be reduced in these appeals.
4. Learned DR, on the other hand, would submit that in these cases under each consignment the entire goods were offending goods. Therefore, the redemption fine and penalty are not liable to be reduced as prayed by the appellants. He also pointed out that the Commissioner has also referred in some of the orders that the importers have committed similar offence on earlier occasion also.
5. Taking into consideration the entire circumstances of the case including the earlier orders passed by this Tribunal referred above, we are of the view that the quantum of redemption fine and penalty has to be reduced even though not to the extent as pleaded by the appellant. We are therefore inclined to reduce the redemption fine at the rate of 20% and penalty to 10% of the value of the goods confiscated. We may record that the learned Counsel for the appellants did not raise objection to the above course. In the result, we modify the orders impugned in these appeals except the one in C/13/2000 by reducing redemption fine as 20% and penalty as 10% of the value of the goods confiscated. In C/13/2000 the quantum of redemption fine is reduced as 20% of the value of the goods confiscated.
The quantum of penalty is not modified as the amount imposed in the impugned order is less than 10% of the value of the goods confiscated.
6. The appeals stand partly allowed.