2023 (6) TMI 1091 - AT - Customs

Confiscation - imposition of redemption fine and penalty - Import of old and used worn clothing completely fumigated - restricted item or not - classifiable under Tariff Item No.63090000 of the First Schedule of the Act or not - HELD THAT - This issue came up before this Tribunal in the case of VENUS TRADERS RAINBOW INTERNATIONAL AL-YASEEN ENTERPRISES GLOBE INTERNATIONAL KRISHNA EXPORT CORPORATION PRECISION IMPEX BMC SPINNERS PVT. LTD. SHIVAM TRADERS LEELA WOOLEN MILLS M.U. TEXTILES VERSUS COMMISSIONER OF CUSTOMS (IMPORTS) MUMBAI 2018 (11) TMI 625 - CESTAT MUMBAI wherein this Tribunal has observed the failure of the original authority to comply with the direction in remand to disclose the margin of profit that prompted the fine and penalty the matter would normally have to be remitted back by another remand order. The redemption fine and penalty imposed on the respondents by the adjudicating authority is sufficient to meet the end of justice. Therefore the redemption fine and penalty confirmed by the adjudicating authority are upheld - there are no infirmity in the impugned order and the same are upheld appeal of Revenue dismissed.

Summary

Issues involved:
The issues involved in the judgment are the enhancement of redemption fine and penalty imposed on the respondent for importing old and used worn clothing, the classification of the imported goods under Tariff Item No.63090000, and the compliance with licensing requirements under the Foreign Trade Policy.

Issue 1: Enhancement of Redemption Fine and Penalty
The respondent imported old and used worn clothing, which were assessed after value enhancement, confiscation, and imposition of redemption fine and penalty. The declared value was increased from US$ 0.45 per kg to US$ 0.60 per kg. The adjudicating authority imposed redemption fine and penalty at the rate of 19.5% and 7.8% of the assessed value, respectively. The Revenue appealed for the enhancement of redemption fine and penalty.

Issue 2: Classification under Tariff Item No.63090000
The imported old and used worn clothing articles were deemed to be classifiable under Tariff Item No.63090000 of the First Schedule of the Act. Import of goods under this Tariff Item is restricted and allowed only against a valid specific license. The adjudicating authority imposed redemption fine and penalty based on this classification and the restrictions under the Foreign Trade Policy 2009-2014.

Issue 3: Compliance with Licensing Requirements
Confiscation under Section 111(d) of the Customs Act, 1962 was invoked for the import of 'old and serviceable garments' without the required import license as per the Foreign Trade Policy. The Tribunal upheld the confiscation under Section 111(d) due to the lack of the necessary license. The redemption fine was reduced to 10% of the ascertained value and the penalty to 5% to serve the ends of justice.

The Tribunal referred to a previous decision where it was highlighted that confiscation of goods is empowered when material particulars are incorrectly recorded in the declaration. The Tribunal upheld the confiscation of goods under Section 111(d) due to the lack of the required import license for the imported garments. The Tribunal reduced the redemption fine and penalty to 10% and 5% of the ascertained value, respectively, to meet the ends of justice. The appeals filed by the Revenue for enhancement of redemption fine and penalty were dismissed.