Chemspark India Pvt Ltd. Vs Commissioner of Customs (CESTAT Mumbai)
In the case of Chemspark India Pvt Ltd. vs Commissioner of Customs, the CESTAT Mumbai addressed the legality of an absolute confiscation order under the Customs Act, 1962. The appellant had imported 1,600 kg of Zinc Pyrithione and 5,000 kg of Sodium Coco Ampho Diacetate from China, paying applicable customs duties. Zinc Pyrithione required mandatory registration under the Insecticides Act, 1968, and the importer did not possess the requisite CIB permit at the time of import. The appellant requested warehousing to avoid detention charges and sought multiple extensions, totaling nine, for obtaining the permit. Unable to secure the permit, the appellant requested permission to re-export the goods to the overseas supplier, which was granted for limited purposes under Section 125 with a redemption fine of ₹1,00,000 and a penalty of ₹25,000, both duly paid.
Revenue challenged this decision before the Commissioner of Customs (Appeals), which resulted in an order of absolute confiscation under Section 111(d), holding that the goods were prohibited and not eligible for redemption. The appellant challenged this order before CESTAT, submitting evidence of re-export through a Let Export Order dated 7.10.2019, which occurred prior to the Revenue’s appeal. The Tribunal observed that once goods are re-exported, they are no longer available for confiscation, except in specific cases such as clearance under bond, which was not applicable here. Consequently, the Tribunal held that the absolute confiscation order was unsustainable in law. The CESTAT allowed the appeal, set aside the impugned order, and held that the Adjudicating Authority’s original order permitting redemption for re-exportation was lawful.
