Customs, Excise and Gold Tribunal - Tamil Nadu
Standard Fire Works Ltd. vs Commissioner Of Customs on 31 January, 2005
Equivalent citations: 2005(185)ELT75(TRI-CHENNAI)
ORDER P.G. Chacko, Member (J)
1. The appellants had imported two second-hand machines and filed a Bill of Entry for clearance thereof on 12-5-1999. The machines were assessed to duty on the basis of documents produced by the importer. As per the documents, the goods were shipped prior to 1-4-1999, the date from which the EXIM Policy 1997-2002 stipulated that secondhand machinery could be imported only under a specific licence. The Bill of Lading presented by the party showed 28-3-1999 as the date of shipment of the goods. On this basis, the above restriction under the EXIM Policy was not applied to the goods and its clearance was allowed. Later on, it was found by the department that the goods had actually been shipped on 10-4-1999. When queried, the local agents of the liners stated that the Bill of Lading was back-dated as per the shipper's instructions. As any second-hand machine shipped on or after 1-4-1999 and imported otherwise than under specific licence was liable to confiscation under Section 111 of the Customs Act, the authorities seized the machines from the appellants' premises on 15-7-1999. A statement was recorded from the Director of the appellant-company, who acknowledged that the goods had actually been shipped on 10-4-1999. He, however, pleaded innocence as regards the date of shipment shown in the Bill of Lading. In the face of the department's proposal to confiscate the machines and to impose penalty on the importer, the appellants waived show-cause notice and requested for early adjudication of the case. Accordingly, the Commissioner of Customs passed the impugned order, whereby the machines were confiscated under Section 111(d) of the Customs Act with an option for redemption thereof on payment of a fine of Rs. 2 lakhs. Ld. Commissioner did not impose any penalty on the party, after recording a finding that there was no evidence to show that they had deliberately tried to manipulate the Bill of Lading.
2. In this appeal, the appellants' focus is on the findings contained in para-8 of the Commissioner's order, wherein it was noted that there was no evidence to show that the party had played any role in manipulation of the Bill of Lading. Ld. Consultant, apart from reiterating the grounds of appeal, submits that the seizure and confiscation of the imported machinery is not lawful for want of departmental challenge to the assessment of the Bill of Entry. The assessed duty was paid and the assessment became final. Thereafter, it was not open to the department to proceed against the goods, consultant argues. It is also submitted that any manipulation of Bill of Lading was at the end of the supplier, for which the importer was not to be penalised, particularly after lawful clearance of the imported goods. These arguments are opposed by learned DR on the strength of the findings recorded by the Commissioner. Ld. DR. further, points out that the adjudicating authority has been fairly lenient in the matter of determining the redemption fine as also of dealing with the question whether any penalty was imposable on the party. A fine of Rs. 2 lakhs is quite reasonable visa-vis the value of the goods estimated at Rs. 19 lakhs.
3. After carefully considering the submissions, we find that there is no dispute of the fact that the goods in question were shipped to India on 10-4-1999. It is also pertinent to note that show-cause notice was waived by the party in the face of the department's proposal to confiscate the seized machines. Now they cannot turn round and say that the confiscation is bad on account of the date of shipment having been manipulated at the supplier's end. Admittedly, secondhand machines shipped after 1-4-1999 required specific licence for their import into India. The appellants did not have any such licence and they chose to obtain clearance under OGL. Though such clearance might smack of fraud on the Revenue, the learned Commissioner of Customs, in fairness, restrained himself from penalising the importer, after observing that there was no evidence of manipulation on their part in relation to the Bill of Lading. We also reject the argument that it was not open to the Department to seize the goods without challenging the assessment. The seizure/confiscation of the goods imported in breach of the restriction was independent of the assessment of the goods to duty. The offending goods were liable to confiscation. Corning to the quantum of redemption fine, we find that fine of Rs. 2 lakhs imposed by the Commissioner under Section 125 of the Customs Act is still below what could have been imposed on the party under the said provision, having regard to the value of the machines and the duly paid thereon. The machines were valued at over Rs. 19 lakhs and the duty paid thereon was over Rs. 10.50 lakhs. In terms of Section 125, a higher amount than Rs. 2 lakhs could perhaps have been imposed as redemption fine. Ld. Commissioner has, obviously, been fair to the appellants in this regard.
4. The impugned order is affirmed and this appeal is rejected.