CESTAT allows Home Consumption of Confiscated Goods on Application of Beneficial Notification, Modifies Re-Export Condition [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai Bench, held that confiscated goods are allowed to be cleared for home consumption on application of a beneficial amending notification and modified the condition restricting redemption to re-export, holding that such beneficial notification is applicable and warrants permitting clearance on payment of applicable duty, interest and other charges.

The appellant, Shireen Imex, filed Bill of Entry dated 06.12.2024 for clearance of imported goods, which were subjected to assessment and found to be in violation of Minimum Import Price (MIP) conditions under DGFT Notification No. 33/2024 dated 01.10.2024.

The respondent, Commissioner of Customs, declared the value was below the prescribed threshold and the goods were treated as prohibited and were confiscated under Section 111(d) of the Customs Act, 1962, with penalty imposed under Section 112(a) and Redemption was allowed only for re-export.

Krishnanandh, the appellant counsel, contended that the appellant had paid the redemption fine and penalty and agreed to pay duty on enhanced value, the goods ought to be allowed for home consumption. It was further contended that the amending notification being beneficial in nature should be applied retrospectively.

Vineet Goyal, the counsel for the Respondent, contended that the import was in violation of the policy prevailing at the time of import and that the benefit of subsequent notification is not applicable.

M. Ajit Kumar, Technical Member observed that the appellant does not dispute confiscation or penalty and challenges only the restriction limiting redemption to re-export.

The Tribunal held that although confiscation was justified at the time of import, the subsequent amending notification altering the status of goods to “restricted” is beneficial in nature and is required to be applied.

Accordingly the Tribunal held that beneficial notifications are to be given retrospective effect in appropriate cases and that redemption for home consumption could be allowed at the enhanced value as offered by the appellant.

In light of facts and circumstances, the Tribunal modified the order to permit clearance of the goods for home consumption after redemption, subject to payment of applicable duty, interest and other charges.

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