The Kolkata bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT)upheld the Redemption Fine and Penalty imposed Under Customs Act,1962 on failure to comply with import license requirements as it met end of justice.
M/s. S N Enterprises and M/s. Shree Krishna Enterprises, 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 classifiable under Tariff Item No.63090000 of the First Schedule of the Act and is restricted item for import as per Para 2.17 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. In some of the cases where goods are not available, no redemption fine is imposed. The Revenue appealed for enhancement of redemption fine and penalty.
In the case of Venus Traders Vs. Commissioner of Customs (Import), Mumbai reported in 2019 (365) ELT 958 (Tri.-Mumbai), wherein this Tribunal has observed that “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. However, the paucity of evidence and the negligible scope for ascertainment at this stage deters us from doing so. 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%.”
It was evident that the respondent doesn’t filed appeal against the confirmed duties and the penalties the Redemption Fine imposed by the Adjudicating Authority.
A two member bench compriisng 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.”
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