Customs, Excise and Gold Tribunal - Calcutta
Kothari Filaments vs Commissioner Of Customs (Port), ... on 19 April, 2002
Equivalent citations: 2002ECR758(TRI.KOLKATA), 2002(144)ELT80(TRI-KOLKATA)
ORDER Archana Wadhwa, Member (J)
1. Vide the impugned order Commissioner of Customs, Calcutta has confiscated the imported goods with an option to the appellants M/s. Kothari Filaments to redeem the confiscated goods on payment of redemption fine of Rs. 30.0 lacs (Rupees thirty lacs only). The appellants have been given an option either to re-export the goods, after redeeming or to clear the same on payment of duty for home consumption. Apart from that personal penalty of Rs. 5.0 lacs (Rupees five lacs only) has also been imposed upon M/s. Kothari Filaments under Section 112(a) of the Customs Act, 1962. Personal penalty of Rs. 1.0 lac (Rupees one lacs only) has been imposed upon the second appellant Shri Rajesh Kothari, proprietor of M/s. Kothari Filaments.
2. Briefly stated the facts of the case are as under :
2.1. The appellant M/s. Kothari Filaments filed a Bill of Entry for 21.5 MTs. of Lithopone 28-30% (Pigment) at the declared price of US $ 390 per M.T. After assessment duty was paid by the appellant on 7-6-99. Thereafter, the goods were examined 100% and it was found that out of the total 860 bags of 25 kgs. each, 460 bags contained lithopone and the balance 400 bags were of tetracycline HCL BP 93. The said tetracycline was not freely importable, as was the case with lithopone and required specific import licence, the same being negative list item. Moreover the said tetracycline attracted higher quantum of duty due to difference in the value of the same and the litho-pone. The said examination was conducted on 8-6-99.
2.2. Thereafter, as per the appellants, upon knowing from their clearing agent that the imported goods were not in accordance with the order placed by them, they immediately contacted their foreign supplier. After checking at his end the foreign supplier informed the appellant that due to mistake in their warehouse, the said consignment was wrongly sent and 10 MTs of tetracycline contained in 400 bags may be shipped back to them. The appellants vide their letters dated 12-6-99 and 25-6-99 brought the above fact to the notice of the Department and also enclosed the correspondence between the appellants and its overseas supplier M/s. Texpo International, Hongkong. The overseas supplier reported that the said 10 MTs. of tetracycline HCL was due to be shipped by them to Belgium importer namely, M/s. Loh How Fook. They also reported that such tetracycline would be to the extent of 10 MTs out of the total consignment of 25.5 MTs. and not 16.77 kgs. as ascertained by the Customs at Calcutta. Accordingly/ they requested for re-verification. The goods were re-examined and the above contention was found to be correct.
2.3. Thereafter, the Revenue conducted overseas enquiries and found that M/s. Texpo International does exist at the given address and no relationship was found between the appellant and the exporting firm at Hongkong. The Revenue also conducted enquiries at the Belgium in order to verify whether any order has been placed by them on the Hongkong Firm for tetracycline. However, said enquiries revealed that the address of the Firm in Belgium, being fake inasmuch as there is a restaurant and not the Firm by the name of M/s. Loh How Fook.
2.4. On the above basis the appellant was served with a show cause Notice proposing confiscation of the goods and imposition of personal penalties. The said show cause notice culminated into impugned order passed by the Commissioner of Customs.
3. Shri J.K. Srivastava, learned Advocate appearing for the appellants submits that import in question was the result of wrong shipment of the goods by their foreign supplier which has also been admitted by them with request to the appellant to re-export the goods. The entire correspondence exchanged between them and Hongkong suppliers have been placed on record and has also been found to be correct by the Customs as a result of their overseas enquiries. As regards enquiries made at Belgium he submits that first of all the result of such enquiries was never made available to the appellant and secondly it is a matter of business relation between Belgium and Hongkong supplier. The importer in India has no means to verify the correctness of the orders placed by the Belgium importer upon their Hongkong supplier. As such the Commissioner's finding that onus to prove that the firm in Belgium had, in fact, placed an order for tetracycline on the Hongkong supplier lies upon the appellant, is not in accordance with law inasmuch as the appellant does not have any connection with Belgium businessmen. He has business relationship only with Hongkong supplier, who have agreed to replace the goods inasmuch as the same were shipped wrongly by them. This, according to Shri Srivastava, is sufficient to establish their bona fides.
4. Shri Srivastava's main contention is that having allowed the reexport of the goods, the Adjudicating authority was not justified in imposing any redemption fine. By referring to various decisions, he submits that it is well settled that no redemption fine can be imposed on re-export being allowed. In this connection he refers to the following decisions :
(a) Siemens Public Communications v. C.C., Airport, Calcutta. - 2001 (137) E.L.T. 623 (Tribunal) = 2001 (43) RLT 57 (CEGAT -Kolkata)
(b) Siemens Limited v. CC. - 1999 (113) E.L.T. 776 (S.C.)
(c) HCL Hewlett Packard Ltd. v. C.C. - 1997 (92) E.L.T. 367 (T)
(d) Skantrons (P) Ltd. v. C.C. - 1994 (70) E.L.T. 635 (T)
(e) G.V. International v. C.C. - 2000 (118) E.L.T. 517 (T) = 2000 (39) RLT 272 (CEGAT)
(f) CC, Calcutta v. J.B. Pvt. Ltd. - 2000 (39) RLT 1074 (CEGAT) As such he submits that inasmuch as the goods have already been re-exported on payment of redemption fine and penalties, the Revenue be directed to refund the same to the appellant.
5. We have also heard Shri V.K. Chaturvedi, learned SDR appearing for the Revenue.
6. The appellant's main contention is that the Adjudicating Authority having allowed the re-export of the goods was not justified in fixing redemption fine or personal penalties upon the appellants. Tribunal in the case of Siemens Public Communication Networks Ltd. v. C.C.(Airport), Calcutta - 2001 (137) E.L.T. 623 (T) = 2001 (43) RLT 57 (CEGAT), Calcutta, after taking note of the earlier decisions of the Tribunal has held that on the option being given to the importer for re-export of the goods, no redemption fine can be imposed. Paras 5 & 6 of the said judgment, which discusses the precedent decisions is reproduced below for better appreciation :
"5. We have heard the submissions made from both the sides. During the course of the arguments the ld. Advocate appearing for the appellant made it clear that the appellants have opted for re-export of the goods. Accordingly, they have challenged the order of the Commissioner imposing a redemption fine and penalty for the said re-export, which according to the appellants is not permissible to be imposed in view of the various case laws relied upon by them. It is seen that in the case of Siemens Ltd. v. C.C. - 1999 (113) E.L.T. 776 (S.C.), their Lordships have held that since goods have been allowed to be re-exported, neither redemption fine nor duty was required to be paid. The Tribunal in the case of HCL Hewlett Packard Ltd. - 1997 (92) E.L.T. 367 (T) has held that no redemption fine is imposable when re-export of the goods is allowed. To the same effect is the decision of the Tribunal in the case of Padia Sales Corporation v. C.C. - 1992 (61) E.L.T. 90 and in the case of Skantrons (P) Ltd. - 1994 (70) E.L.T. 635. We further find that the Tribunal in the case of G.V. International and Another - 2000 (39) RLT 272, following the earlier decisions of the Tribunal, has set aside the orders passed by the lower authorities ordering confiscation of goods and their release on payment of redemption fine and penalty. Further in the case of Commissioner of Customs, Calcutta v. J.B. (P) Ltd. - 2000 (39) RLT 1074, the order of the lower authorities allowing re-export of the goods without fine and penalty was upheld.
6. As discussed above the issue is squarely covered in favour of the appellants by the various decisions of the Tribunal and the Hon'ble Supreme Court. Inasmuch as the Commissioner vide his impugned order has given an option to the appellants to re-ship the goods back to the supplier, we hold that the redemption fine and the penalty imposed by him was not justified. We accordingly set aside the same and allow re-export of the consignment in question without any redemption fine or penalty or duty.
Appeal is thus allowed in above terms."
7. As is clear from above reading of the paragraphs reproduced, the issue is no more res Integra. The various decisions as discussed above are to the effect that no redemption fine is imposable when re-export of the goods is allowed. Accordingly the impugned order imposing redemption fine and penalties is set aside on this ground alone and appeals are allowed with con-sequential relief.
Sd/-
(Archana Wadhwa) Member (J)
8. [Contra per : C.N.B. Nair, Member (T)]. - The plea for quashing redemption fine and penalties is made on the ground that the Commissioner has allowed re-export of imported goods and once re-export of imported goods is permitted imposition of redemption fine and penalty is not legally permissible. This submission that fine and penalty are not permissible in cases where re-export of imported goods is permitted has been raised relying on the decision of the Supreme Court in the case of Siemens Ltd. v. CCE reported in [1999 (113) E.L.T. 776 (S.C)] and the decision of the Tribunal in the case of Siemens Public Communications v. CC, Airport, Calcutta - 2001 (137) E.L.T. 623 (T) = 2001 (43) RLT 57 (CEGAT-Kolkata). I am afraid, the above cited decision of the Supreme Court and Tribunal are not applicable to the present case.
9. This position is clear from the impugned order itself. Relevant paras 48 to 50.1 of the order read as under :-
"48. I have already held in para 46 supra that the goods misdeclared to the extent of 10 MTs of Tetracycline detected in the consignment of 21.5 MTs Lithopone as per declaration on the Bill of Entry, the above consignment of 21,5 MTs is liable for confiscation under Sections 111(d) and 111(m) of the Customs Act, 1962, read with Section 119 ibid and Section 3 of the Foreign Trade Development and Regulation Act, 1992. The learned Advocate has referred to a case of East Indian Commercial Company Ltd. v. Collector reported in 1983 (13) E.L.T. 1342 (S.C.) and also order of CEGAT in the case of Skantrons Pvt. Ltd. v. Collector of Customs, New Delhi, It has been held in these cases as "imposition of redemption fine and confiscation of goods under Section 111(d) while giving an option for re-export of the goods is not correct in law. When the goods are confiscated because of any ITC prohibition in terms of Section 111(d) and an option to pay fine in lieu of such confiscation is given, the effect of such option is to lift the prohibition. In other words, the importer/appellant is entitled to import the goods and consume them within the country on payment of such redemption fine. Therefore, the simultaneous imposition of two conditions, namely, (i) imposition of fine in lieu of confiscation and (ii) directing re-export cannot co-exist together. In view of this legal position, the appellant is entitled to refund of redemption fine paid by him if the goods have been re-exported". In this case, however, I find that there is not only ITC violation, but this is also a clear case of misdeclaration and goods are not only liable for confiscation under Section 111(d) of the Customs Act, 1962, but also under Section 111(m) of the Customs Act, 1962. Moreover, the plea of the importers that the goods were mis-sent by the supplier has also been found incorrect on overseas investigation. Therefore, the ratio of the cited case would not apply to this case. In this case, ITC violation has taken place. Misdeclaration and mala fide intention is also conclusively proved. Option to redeem the goods can be allowed for the purpose of re-export as requested by the party, but the party would have to redeem the confiscated goods after only such option is given to him. I am inclined to consider importer's request for re-export of the whole consignment subject to importer's making payment of redemption fine and penalty imposed by this order and also after getting 'no objection' certificate for such re-export from RBI within a specified period as there is a question of involvement of foreign exchange for the import of the subject consignment.
49. Request for the release of 11.5 MTs of Lithopone and re-export of 10 MTs of Tetracycline out of 21.5 MTs of the consignment mis-sent is not possible on the basis of my findings supra.
50. Based on my findings above, I pass the following order :-
(i) I order confiscation of the whole consignment weighing 21.5 MTs containing 10 MTs of Tetracycline and 11.5 MTs of Lithopone under Sections 111(d) and (m) of the Customs Act, 1962, read with Section 119 ibid read with Section 3 of Foreign Trade (Development and Regulation) Act. I, however give the importers an option to redeem the confiscated goods on payment of a fine of confiscation Rs. 30,00,000/- (Rupees thirty lakhs only) in lieu of confiscation. The option must be exercised within three months of the receipt of this order or such extended period as may be allowed by the Commissioner of Customs (Port). After redemption the importers may re-export the goods within a fortnight from the date of such redemption without any payment of duty leviable thereon or the importers may take out the goods for home consumption on payment of duty on the date of such redemption".
10. From a perusal of the above findings and order of the adjudicating authority, it is clear that the Commissioner considered the appellant's explanation that the goods were mis-sent and came to the conclusion that it was not a case of wrong goods being sent by mistake but was a case of deliberate import of Tetracycline in question in a clandestine manner. The import of Tetracycline required specific import licence under the import control and, being a medicine, it also had to be, in conformity with the provisions of Drugs and Cosmetic Act. Instead, 10 MT of Tetracycline was concealed in a consignment of Lithopone and imported in the garb of Lithopone. 10 MTs of Tetracycline was intermixed in a consignment declared as 21.5 MT of Lithopone. This was clear from the packing adopted. Tetracycline was concealed in the consignment declared as Lithopone and Chits of paper indicating the goods as Tetracycline were kept in those bags so that the receipient of the goods makes out the Tetracycline from the other packets containing Lithopone. The import of Tetracycline was sought to be achieved through concealment of its identify from various authorities by mis-declaring the consignment as exclusively of Lithopone. Thus, passing off the Tetracycline packets also as Lithopone packets and the importer being able to make out the Tetracycline packets inter alia from the chits of paper containing, the correct description as Tetracycline dropped in the packets. Taking all these factors as well as other evidence into account, the Commissioner clearly rejected the appellant's explanation regarding error at the despatch point and held that "Misdeclaration and mala fide intention is also conclusively proved" and the Commissioner ordered that option to export the goods can be given only if the goods are redeemed and no objection certificate for the re-export is obtained from the RBI. Further, in para 49, the Commissioner specifically rejected the request for re-export of the 10 MT of Tetracycline on the ground of the consignment being mis-sent. From these findings in the impugned order, it is clear that this was not a case where the Commissioner allowed re-export of the goods. Instead, goods were clearly held to be liable to confiscation for violation of Clauses (d) and (m) of Section 111 of the Customs Act. The Commissioner, in fact, gave no permission for re-export of the goods. This is clear from the relevant portion of the order in para 50(i). The last sentence of the para 50(i) of the order merely observes as under :
"After redemption, the importers may re-export the goods within a fortnight from the date of such redemption without any payment of duty leviable thereon or the importers may take out the goods for home consumption on payment of duty on the date of such redemption".
11. The reading of the impugned order, in particular, paras 48 to 50(i) reproduced earlier in this order makes it abundantly clear that this is a case where the adjudicating authority clearly held that the goods came within two Sub-clauses (d & m) of Section 111 of the Customs Act for the purpose of confiscation. The Commissioner totally rejected the explanation preferred by the appellant-importer, that part of the consignment (tetracy-cline) had been mis-sent by mistake by his supplier. The observation regarding re-export contained in para 50(i) is only in the nature of clarifying the position that the appellants could dispose of the confiscated goods, after its redemptions, either for home consumption on payment of duty or export without payment of duty. These observations can, in no way, be construed as permission to re-export. The observations regarding disposal of redeemed goods are superfluous and irrelevant, to the adjudication proceedings.
12. In view of the above position observed from the order, I am of the strong view that the cited decision of the Supreme Court and the Tribunal are not of any relevance to the present case and there is no warrant for quashing of fine and penalties.
13. Quashing of fine and penalty in the present case would also be clearly against the mandate of the relevant Sections of the Customs Act. Section 111 of the Customs Act mandates that imported goods attracting the various clauses of that Section have to be confiscated. In the present case, the offending goods are medicines. The import of medicines required both import licence and clearance under Drugs and Pharmaceuticals Act. Both are vital requirements in the interests of import regulation as well as protection of public health. In the present case, the evidence on record have established that to import over 10 MT of medicines in the guise of import of Lithopone. Thus, a huge fraud was under way. It included also an evasion of customs duty of over Rs. 38 lakhs. In these circumstances, the redemption fine of Rs. 30 lakhs and the penalty of Rs. 5 lakhs imposed on the importing firm can be treated only as very lenient punishments. The provisions contained in Section 125 of the Customs Act relating to quantum of redemption fine and the provisions regarding quantum of penalty contained in Section 112 of the Customs Act envisage much stricter punishment. And the facts and circumstances of the case warranted a higher quantum of punishment. I, therefore, do not consider it necessary to grant any relief in respect of the fine of Rs. 30 lakhs and penalty of Rs. 5 lakh on the importing firm. However, a personal penalty of Rs. 1 lakh imposed on the Proprietor of the firm is superfluous, as a penalty of Rs. 5 lakh has already been imposed on the Proprietary firm, which penalty is payable by the Proprietor.
14. In view of what is stated above, I am of the view that this appeal is only required to be rejected.
Sd/-
(C.N.B. Nair) Member (T) POINT OF DIFFERENCE In view of separate Orders by Member (Judicial) and Member (Technical), difference of opinion is framed as under :-
"Whether the appeal is required to be allowed as held by Member (Judicial) or the same is required to be rejected as held by Member (Technical)."
Sd/- Sd/- (C.N.B. Nair) (Archana Wadhwa) Member (T) Member (J) Dated : 12-10-2001.
15. [Order per : Justice K.K. Usha, President]. - Appeals are at the instance of the assessee challenging the order dated 29-12-2000 passed by the Commissioner of Customs (Port) Calcutta.
16. The appellant filed a home consumption Bill of Entry for clearance of goods imported by them where the goods were declared as 21.5 MTs of Lithopone 28-30% (pigment). Lithopone is freely importable. Bill of Entry was assessed to duty as per declaration given on 3-6-99. After assessment and payment of duty when the goods were further examined on 8-6-99 it was found that out of the total 860 poly-bags there were 671 bags of yellow chemical weighing 16.775 MT, the remaining 108 bags contained white colour chemical. White colour chemical was packed only in poly bags, whereas yellow colour chemical was packed in two paper bags which were finally packed in poly-bag. On test it was found that white colour chemical was Lithopone and yellow colour chemical was Tetracycline HCL. Explanation offered by the importer was that their suppliers had by mistake sent 10 MT of Tetracycline HCL which were due to be shipped to Belgium importer; namely, Lok Hauw Fook NV. On further examination it was found that Tetracycline was 10 MT and not 15.775 MT. On overseas enquiry it was found that the so-called importer at Belgium, viz., Lok Hauw Fook NV was not a firm engaged in the business of Tetracycline but was only a restaurant. Tetracycline is an item found in the negative list in the Exim Policy which required licence for its import. Physical examination brought to light that Lithopone and Tetracycline were so much intermixed and the method of packing made it clear that there was intention of concealment. The contention raised by the importer that the goods were mis-sent was not accepted. It was held that Tetracycline has been imported by way of concealment and under misdeclaration in the guise of Lithopone to evade duty and in contravention of the provisions of Customs Act, 1962. It was held that the whole consignment of Tetracycline and Lithopone is liable to confiscation under Section 111(d) and 111(m) read with Section 119 of the Customs Act, 1962. The Commissioner thereafter passed the following order :
ORDER "50(i) I order confiscation of the whole consignment weighing 21.5 MTs containing 10 MTs of Tetracycline and 11.5 MTs of Lithopone under Section 111(d) and (m) of the Customs Act, 1962, read with Section 119 ibid, read with Section 3 of Foreign Trade Development and Regulation Act. I, however, give the importers an option to redeem the in confiscated goods on payment of a fine of confiscation Rs. 30,00,000 (Rupees thirty lakhs only) in lieu of confiscation. The option must be exercised within three months of the receipt of this order or such extended period as may be allowed by the Commissioner of Customs (Port). After redemption, the importers may re-export the goods within a fortnight from the date of such redemption without any payment of duty leviable thereon or the importers may take out the goods for home consumption on payment of duty on the date of such redemption.
(ii) I impose a penalty of Rs. 5,00,000 (Rupees five lakhs) on M/s. Kothari Filaments Pvt. Ltd. under Section 112(a) of the Customs Act, 1962.
(iii) I also impose a personal penalty of Rs. 1,00,000 (Rupees one lakh only) on Mr. Rajesh Kothari, Proprietor of the importing firm M/s. Kothari Filaments under Section 112(b) of the Customs Act, 1962.
(iv) I don't find any allegation against the clearing agents M/s. P.B.A. Clearing Agents Pvt. Ltd. Hence I don't impose any penalty u/s 112(a) of the Customs Act, 1962. They discharged their function u/s 147 of the Customs Act, 1962, where the liability of the agent had been made specific and the liability of the agent in this case is not conclusively proved."
17. Appellant contended that 10 MTs of Tetracycline was mis-sent and the allegation of mis-declaration is not correct. It is not seen that the above contention is accepted by the Learned Member (Judicial) even though she was inclined to allow the appeal on another ground. As far as the Learned Member (Technical) is concerned he has entered a finding that the Commissioner has correctly held that the goods were liable to be confiscated for violation of Clause (d) and (m) of Section 111 of the Customs Act.
18. The appellant has further contended that the adjudicating authority having allowed re-export of the goods was not justified in fixing redemption fine or personal penalty upon the appellant. After referring to various decisions Learned Member (Judicial) took the view that the impugned order imposing redemption fine and penalty is to be set aside as no redemption fine is imposable when re-export of the goods is allowed. On the other hand, Learned Member (Technical) took the view that the order impugned cannot be understood as one granting permission to re-export. According to the Learned Member a reading of the impugned order would show that the Commissioner had totally rejected the explanation offered by the importer and had come to the conclusion that this is a case where the goods came within the two Sub-clauses (d) and (m) of Section 111 of the Customs Act for the purpose of confiscation. Therefore, when the Commissioner has passed order directing confiscation and imposition of redemption fine, the adjudication proceeding comes to an end. According to the learned Member no permission is granted by the Commissioner to re-export the goods. The last sentence in paragraph 50(i) is superfluous and irrelevant to the adjudication proceedings. It is only in the nature of clarifying the position that the appellants could dispose of the confiscated goods, after its redemption, either for home consumption on payment of duty or export without payment of duty.
19. It is in the light of the above difference of opinion between the two Members, the following point is referred :
"Whether the appeal is required to be allowed as held by Member (Judicial) or the same is required to be rejected as held by Member (Technical)".
20. On going through the records of the case and after hearing the parties, I do not find any reason to take a view that the goods are not liable to be confiscated in view of violation of Clause (d) and (m) of Section 111 of the Customs Act. The procedure adopted in the mode of packing and mixing Lithopone with Tetracycline would make it clear that there was definite intention to conceal Tetracycline. Tetracycline was concealed in the consignment declared as Lithopone and chits of paper indicating the goods as Tetracycline were kept in those bags so that the recipient of the goods could identify Tetracycline from the other packets containing Lithopone. The explanation offered by the appellant that the goods were mis-sent were correctly rejected by the Commissioner. The Commissioner was justified in holding that there was mis-declaration and mala fide intention which made the goods liable for confiscation for violation of Clause (d) and (m) of Section 111 of the Customs Act.
21. It is relevant to note that while the Learned Member (judicial) holds that no redemption fine is imposable when re-export of goods is allowed, learned Member (Technical) does not hold otherwise. On the other hand, by interpreting the order of the Commissioner the Member (Technical) comes to the conclusion that no permission has been granted by the Commissioner to re-export and therefore the question that Commissioner cannot pass an order granting permission to re-export while imposing redemption fine does not arise in this case. In paragraph 48 of the order impugned the Commissioner refers to the argument as to whether simultaneous imposition of two conditions, namely, (i) imposition of fine in lieu of confiscation and (ii) direction to re-export can co-exist. Ultimately in paragraph 49 he rejects the request for release of 11.5 MTs of Lithopone and re-export of 10 MTs of Tetracycline. Thereafter in paragraph 50 he orders confiscation of the whole consignment containing 10 MTs of Tetracycline and 11.5 MTs of Lithopone under Section 111(d) and (m) of the Customs Act, 1962 read with Section 119 and Section 3 of the Foreign Trade Development & Regulation Act. An option to redeem the confiscated goods was then granted on payment of a fine of Rs. 30 lakhs in lieu of confiscation. Thereafter he observed that the importer may re-export the goods after redemption or take out the goods for home consumption. The above observation cannot be treated as an option given to the importer to re-export. No provision of law has been brought to my notice which gives jurisdiction to the Commissioner in an adjudication proceedings as in the present case to grant permission for re-export. In Goodyear India Ltd. v. Collector of Customs (Final Order No. A/32/90-NRB, dated 27-12-90) which was followed in Padia Sales Corporation v. Collector of Customs - 1992 (61) E.L.T. 90, it has been held as follows :
"7. The Collector by his order confiscated the goods. However, as per Section 125 of the Customs Act, 1962 he is empowered to allow the importer to redeem the goods on payment of fine. The imposition of fine only validates the import, in other words, on payment of fine the importer becomes absolute owner of the goods, and he is free to export them subject to the provisions of Customs Act, 1962 and Rules made thereunder. The provision enables the owner, to avoid confiscation by paying the fine imposed. However, there is no provision under the Act empowering the Collector to re-export the goods on payment of redemption fine. The order passed by the Collector is, therefore, without jurisdiction. The reliance placed by Ms. Mann on para 128 of the Handbook of Import and Export Procedures 1985-88 is irrelevant to the facts of the case.
8. We, therefore, modify the order of the Collector in the following manner :
"The goods are confiscated, but the appellants are entitled to redeem the same on payment of Rs. 5000/-. Accordingly, we dispose of the appeal."
In the above mentioned two cases challenge was against the imposition of redemption fine while permitting re-export and in both the cases the Tribunal modified the orders retaining that portion of the order directing confiscation and imposing redemption fine. Direction for re-export was vacated. The position of law as explained in the above decision is that once the redemption fine is paid and the confiscated goods are redeemed the importer becomes the full owner of the goods and it is open to him to deal with the goods as he desires either to use it in domestic consumption or to export the same subject to relevant rules. In the light of the above, there is justification in the view taken by the Learned Member (Technical) that the last sentence in paragraph 50(i) of the order may be treated as an observation with regard to the legal position. This is more so in view of the rejection of the prayer of the importer to release the goods for re-export in paragraph 49 of the order.
22. I am not referring to the number of decisions referred by the learned Member (Judicial) on the issue whether redemption fine can be imposed along with direction or permission to re-export the goods as no different view is expressed by the learned Member (Technical) on this issue, The redemption fine and penalty imposed on the importer firm are upheld. The personal penalty of Rs. 1 lakh imposed on the proprietor of the firm is vacated.
23. In the light of the above, I am of the view that the appeal has to be rejected, as held by the learned Member (Technical).
Sd/-
(Justice K.K. Usha) President FINAL ORDER In view of the majority opinion, the appeals are rejected.
Sd/- Sd/- (C.N.B. Nair) (Archana Wadhwa) Member (Technical) Member (Judicial)