2008 (9) TMI 736 - AT - Customs

Summary

Issues: Export of medicines to USA in violation of Rule 31 of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977; Confiscation of goods, penalty imposition, reliability of guidelines from a website.

Analysis:
1. The case involves the export of medicines to the USA by the applicant, declared as 'non-controlled medicines in blister packings.' The department alleged that the export was not permitted under US laws, citing guidelines from a website. Consequently, the goods were held liable for confiscation, a portion of the sale proceeds was confiscated, and a penalty of Rs. 5 lakhs was imposed for violating Rule 31 of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977.

2. The applicant argued that the guidelines from the website used by the department were unreliable. They highlighted that multiple consignments of the same medicines had been exported to various customers in the USA without any seizures or legal actions, challenging the department's assertion of a violation of US laws. Moreover, the applicant pointed out that Rule 31, the basis of the penalty, had been deleted post the alleged violation.

3. After considering the facts and circumstances, the Tribunal found that the penalty imposed should be waived in this case. The Tribunal deemed it appropriate to waive the pre-deposit of the penalty and stayed the recovery of the penalty until the appeal was disposed of. This decision was made based on the arguments presented by the applicant regarding the reliability of the website guidelines and the absence of any legal actions in the USA against the exported medicines.

This detailed analysis covers the issues of export violation, confiscation, penalty imposition, and the reliability of the website guidelines, providing a comprehensive understanding of the judgment delivered by the Appellate Tribunal CESTAT, New Delhi.