The Kolkata bench of the Customs Excise & service tax appellate tribunal(CESTAT) confirmed the penalty and redemption fine as the exact description and quantity of imported old used worn clothes not determined since no 100% examination of all containers was done at the time of clearance of goods.
M/s. K.K. Woollens & Others, the respondent imported old and used worn clothing, completely fumigated which were assessed after value enhancement, confiscation and imposition of redemption fine and penalty.
The declared value was enhanced from US$ 0.45 per kg to US$ 0.60 per kg and redemption fine and penalty were also imposed on the ground that the old and used worn clothing articles are classifiableunder Tariff Item No.63090000 of the First Schedule of the Act and is restricted item for import as per of Foreign Trade Policy 2009-2014, read with ITC HS Classification of import and export items 2009-2014.
Import of goods under Tariff Item No.63090000 is restricted and their import is allowed only against the valid specific license. The Adjudicating Authority has imposed redemption fine and penalty at the rate of 19.5% & 7.8% of the assessed value respectively.
It was observed that the exact description and quantity of goods, container wise, cannot be determined at this stage since no 100% examination of all containers was done at the time of clearance of goods. At any event all the importers had agreed during the personal hearing conducted by the then Commissioner of Customs (I), that the impugned goods were either old and used garments other than rags or they were not mutilated as per the norms laid down in this regard.
Considering the various issues and submissions made and 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.
In the light of the admitted failure to comply with the licensing requirements, we uphold the confiscation of the goods under Section 111(d) of Customs Act, 1962. However, it is our opinion that the ends of justice would be served by reducing the redemption fine to 10% of the ascertained value and penalty to 5%.
Against the confirmed duties and the penalties the Redemption Fine imposed by the Adjudicating Authority, the Respondent has not filed any appeals.
A two member bench of Mr. R. Muralidhar, Member (Judicial) and Mr. Rajeev Tandon, Member (Technical) held that 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.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
