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TMI Blog1983 (4) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... (d) and (m) of the Customs Act but in lieu of confiscation, the appellants were given the option under Section 125 of the Act to clear the goods on payment of redemption fine of Rs. 50,000/-. The appellants appealed to the Central Board of Excise and Customs which sustained the order of confiscation but reduced the redemption fine to Rs. 20,000/-and directed :- "..........after the goods are mutilated to the satisfaction of Collector of Customs, Calcutta, by the importers at their cost and under customs supervision so as to render them unfit for use except rags and after payment of appropriate duty, the goods be released on payment of a fine of Rs. 20,000/- within three months hereof." The appellants then moved the Central Government in revision against the Board's order and in due course the revision was transferred to the Customs, Excise and Gold (Control) Appellate Tribunal. The Tribunal by its order dated 31st July, 1984 gave the following direction while disposing of the appeal :- "........the goods be released on payment of customs and other related duties, under T.I. 63.02, with countervailing duty as leviable under corresponding entry in the Central Excise Tariff. This i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it. Section 125 provides that :- "Whenever confiscation of any goods is authorised, by this Act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any law for the time being in force, and shall, in the case of any other goods, give to the owner of the goods an option to pay in lieu of confiscation such fine as the said officer thinks fit..........." Where such option is not given or even if such option is given it is not availed of, under Section 126, the goods are confiscated and upon confiscation they vest in the Central Government. 4. In view of these provisions in the Act, there can be little scope to dispute that until the goods is cleared for home consumption, the scheme of the Act requires the goods to remain in the hands of the Customs authorities and obviously the statutory liability to account for the goods would be of the authorities under the Act charged with the responsibility of keeping the goods. 5. 19 bales, as alleged, appear to be missing and 39 bales are said to be available. The appellants have contended that the goods has not been properly preserved and parts of some of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion fine of Rs. 20,000/- and mutilation of the goods to the satisfaction of the Collector at the cost of appellant and under the supervision of the Customs authorities. 6. The matrix of the case is that in accordance with the import policy of 1979-80 which provided for import of certain items including woollen rags though canalised agency, the appellant company placed order to the State Trading Corporation, the canalised agency, for import of mutilated woollen rags in which the contents of wool would be minimum 80% under the order of allocation issued by the Textile Commissioner, Bombay in the name of the appellant. On 4-4-1979 the foreign suppliers namely M/s. Gorodensky Regd., 8, Queen Street, Montreal, Canada entered into a contract for the supply of old rags of woollen textile fabrics (including knitted and crocheted fabrics) which are required for manufacture of shoddy yarn and not consist of articles of furnishing or clothing or other clothing so worn out, soiled or torn as to be beyond cleaning or repair. Fumigation Certificate from Government or Municipal Health Authorities was to be provided by suppliers at their cost with the State Trading Corporation. The specification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g any penalty under Section 112 of the Customs Act, 1962 as there was no force to show the complicity of either the STC or the Appellant in arranging for import of goods which are different from what had been ordered." 7. Against this order an appeal was made to the Central Board of Excise and Customs. The Central Board of Excise and Customs came to the conclusion that the goods imported could not be described as woollen goods at all as the wool contents were found to be not exceeding 10%. The Board however, considering the fact that the goods have been imported through the STC and there was no involvement of the importers in the importation of wrong goods took a lenient view and directed that after the goods are mutilated to the satisfaction of the Collector of Customs by the appellant at his cost and under Customs supervision so as to render them unfit for use except rags and after payment of appropriate duty, the goods be released on payment of a fine of Rs. 20,000/- within three months of the order. 8. Against this order the appellant filed an appeal before the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi. The Appellate Tribunal disposed of the appeal orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods by the Board, in respect of such goods. It has been further stated that the Collector of Customs under his order No. S.33/53/79A(GII) dated' 2-1-1980 confiscated the entire consignment of the said imported goods and removed 6 bales only from 1 K.P.D. to their confiscated godown at Clive Warehouse on 8-8-1981 by P.T.C.G. (Port Trust Covered Rly. Wagon) No. 1362, and the balance 39 bales have been lying since its landing at different points of docks in a very deteriorated condition. It was further stated that the entire consignment was confiscated by the Collector of Customs and only 6 bales were removed and the balance 39 bales had been lying in the Port premises at the sole risk of Customs and the Port Trust had no authority for the disposal of the goods which were confiscated by the Customs authorities. It has been stated that the Port Trust has no liability for loss or damage of these confiscated goods which are in the custody of the Customs authorities. 10. An affidavit has been filed on behalf of the appellant sworn by one Dharam Paul Oswal, Managing Director of the appellant mill on 31-3-1987 stating inter alia that their Manager, Mr. H.K. Goel visited the Calcutta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were unloaded from the ship in the Customs area. So these were under the control of the officers of Customs. Moreover after confiscation of the entire consignment of imported goods i.e. 45 bales out of 58 bales of woollen rags, the same vested in the Central Government in accordance with the provisions of Section 126 of the said Act. It is also clear from the averments made on behalf of respondent No. 2, the Calcutta Port Trust, as stated hereinbefore that the imported goods remained in the Customs area and these were subsequently confiscated by the Collector of Customs. The imported goods were not handed over to the custody of the Port Trust. Therefore it is the Customs authorities who are in possession and control of the said imported bales of woollen rags and they cannot shirk their responsibility for the loss and damage of the said goods and they are liable to pay the value of the goods to the appellant as damages in order to re-compensate the appellant. It is pertinent to mention in this connection that under Sections 42 and 43 of the Major Port Trusts Act, 1963 it is only when the goods have been taken charge of and receipt given for them under Section 42(7) of the said Act l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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