Antoine & Becouerel Organic Chemical Co. Vs Customs Excise and Service Tax Appellate Tribunal (Madras High Court)
The Madras High Court examined whether the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, acted within its jurisdiction while deciding an appeal filed by an assessee. The case arose from an order-in-original dated 28.03.2014 passed by the Commissioner of Customs, which confiscated imported goods under Section 111(d) of the Customs Act, 1962, read with the Drugs and Cosmetics Act, 1940 and the relevant Rules. However, the adjudicating authority permitted redemption of the goods under Section 125(1) of the Customs Act for the limited purpose of re-export, subject to payment of a redemption fine of ₹7,00,000.
The assessee challenged the confiscation, penalties, and interest before the CESTAT. Significantly, the Customs Department did not file any appeal under Section 129A(2) of the Customs Act, nor did it file cross-objections under Section 129A(4), against the part of the adjudication order permitting redemption and re-export. The Department also did not invoke suo motu revision powers under Section 129DA. Consequently, the direction allowing redemption and re-export attained finality.
Despite this, while deciding the assessee’s appeal, the CESTAT not only addressed the issues raised by the assessee but went further. It recorded findings alleging fraud and involvement in a smuggling racket, held that the goods had become “no man’s property,” and ordered absolute confiscation, thereby setting aside even the redemption and re-export allowed by the adjudicating authority. The Tribunal also observed that re-export of the goods had caused detriment to the interests of justice and left it to the Chairman of the Central Board of Excise and Customs to take appropriate action, noting that the goods had already been re-exported after payment of redemption fine.
