Case Law Details
Commissioner of Customs Vs S K P Enterprises (CESTAT Kolkata)
Introduction: In a noteworthy decision, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Kolkata dismissed an appeal made by the Revenue (Commissioner of Customs) against S K P Enterprises. The crux of the case involves the import of old and used worn clothing articles, which are restricted items as per the Foreign Trade Policy. This article offers a detailed analysis of the case, touching upon critical aspects such as the value enhancement, imposed fines, penalties, and the legality of the tribunal’s decision.
The Background of the Case: The respondent, S K P Enterprises, imported fumigated old and used worn clothing, which were assessed for value enhancement and subjected to confiscation along with the imposition of redemption fine and penalty. The declared value of the goods was increased from US$ 0.45 per kg to US$ 0.60 per kg based on regulations outlined in the Foreign Trade Policy 2009-2014 and Tariff Item No.63090000 of the First Schedule of the Act.
The Impugned Redemption Fines and Penalties: The Adjudicating Authority imposed redemption fines and penalties at the rate of 19.5% and 7.8% of the assessed value, respectively. In some cases where goods were not available, no redemption fine was imposed. The Revenue appealed before CESTAT for an enhancement of these fines and penalties.
Reference to Previous Rulings: The Tribunal referred to a previous case, Venus Traders Vs. Commissioner of Customs (Import), Mumbai, to guide its decision. It was observed that the proceedings against most imports started even before the filing of bills of entry. Therefore, invoking Section 111(m) of the Customs Act, 1962, for confiscation under the stated circumstances seemed inappropriate.
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