Import of Yogurt Flavoured Milk Drinks through Unauthorized Port Violates Livestock Import Norms: CESTAT Upholds Redemption Fine [Read Order]

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the redemption fine imposed under Section 111(d) of the Customs Act, 1962 and held that the import of yogurt flavoured milk drinks through an unauthorized port violated the Livestock Importation (Amendment) Act, 2001 and the Notification S.O. 2666(E) dated 16.10.2014.

The appellant, A.K. Jain Sales & Marketing Pvt. Ltd had imported 4,600 cartons of yogurt flavoured milk drinks through the Changrabandha Land Customs Station (LCS) vide Bill of Entry No. 6672215 dated 29.01.2020.

Changrabandha is not one of the ports authorized for the importation of livestock products under the Notification issued by the Department of Animal Husbandry, Dairying and Fisheries, Ministry of Agriculture. At the time of importation, the appellant could not produce any veterinary certificate and later submitted one issued by the Department of Livestock Services.

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The Assessing Officer (AO) found a violation of the Livestock Importation (Amendment) Act, 2001 read with Section 11 of the Customs Act, held the goods liable to confiscation under Section 111(d), but allowed clearance on payment of redemption fine at 10% and penalty at 5% of the assessable value, treating it as a venial breach.

On appeal, the Commissioner (Appeals) set aside the penalties but upheld the redemption fines, leading the appellant to approach the Tribunal.

The Bench comprising R. Muralidhar (Judicial Member) and K. Anpazhakan (Technical Member) noted that, as per S.O. 2666(E), all livestock products are to be imported only through specified ports, Delhi, Mumbai, Kolkata, Chennai, Bangalore, and Hyderabad, where Animal Quarantine and Certification Services Stations are located.

Since Changrabandha LCS was not one of the authorized ports, the appellant failed to comply with the said provisions. It observed that though the imported goods met sanitary and bacteriological standards, the act of importing through an unauthorized port itself constituted a violation.

The Tribunal held that the appellant was aware that Changrabandha LCS was not a notified port for livestock products, yet continued to import multiple consignments through it. The Tribunal reasoned that such port restrictions are meant to ensure examination by qualified authorities available only at designated ports.

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The Tribunal relied on the decision in Broadway Overseas Ltd. v. Commissioner of Customs, Amritsar (2014), which was affirmed by the Punjab & Haryana High Court, and the Tribunal held that import through an unauthorized port is contrary to statutory restrictions and justified the confiscation and imposition of a redemption fine. The Tribunal found no infirmity in the order of the Commissioner (Appeals) and rejected the appeals filed by the appellant.

Accordingly, the CESTAT upheld the redemption fine under Section 111(d) of the Customs Act, 1962, holding that import of livestock products through an unauthorized port is in violation of Livestock Import Norms.

The appellant was represented by Nilotpal Chowdhury along with Sweety Jha, while S. Chakravorty appeared for the Revenue.

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