The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai bench has held that the redemption fine cannot be imposed when the goods are allowed to be re-exported.
The goods imported by the appellant were seized by the department based on specific intelligence by SIIB, Chennai. After opening the boxes, it was noticed that the cartons contained “used / old mini tower computer cases with motherboard / system board having brand names such as Dell, HP etc. attached with power supply port, hard disk / CD / DVD drive, USB ports, audio port, VGA port and accessories”. The goods declared as per the bill of entry was “mini tower computer case with power supply accessories”. There were undeclared goods along with declared items. Consequently, the goods were found illegally imported and the department imposed redemption fine.
The appellant argued that the shipper had provided information that the Container No. CAIU7487227 had wrongly been exported to them and it was actually to be shipped to another customer of another country.
Judicial Member Ms. Sulekha Beevi observed that the Commissioner (Appeals) has set aside the order passed by the adjudicating authority allowing the appellant to re-export the goods.
“I find that this conclusion arrived at by the Commissioner (Appeals) to set aside the order of the adjudicating authority is highly erroneous in absence of an appeal filed by the department. The said order passed by the Commissioner (Appeals) to confiscate the goods without option to redeem the goods for re-export requires to be set aside, which I hereby do,” the Tribunal said.
Granting relief to the appellant, the Tribunal concluded that “in the above decision, the Tribunal has held that when the goods are allowed to be re-exported, the imposition of redemption fine cannot sustain. In the present case, the adjudicating authority has also imposed penalty of Rs.2 lakhs. The adjudicating authority after considering the submissions made by the appellant that the goods were intended to be supplied to another customer of another country has allowed the request for re-export. On such score, when the goods have not been intended to be imported by the appellant, no penalty can be imposed.”
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