Case Law Details
Commissioner of Customs Vs Oriental Trimex Ltd. (CESTAT Delhi)
If the confiscated goods allowed to redeemed on a redemption fine then the sale proceeds will be paid only after deduction of such fine
In the given case the importer appellant is engaged in the business of import of marble from various countries into India and the goods in question are covered under the category of restricted goods in terms of provisions of Exim Policy and a license is required for valid importation of these goods as per DGFT Policy Circular No. 37 (RE-08) 2004-2009 dated 31/10/2008. The importer – appellant appeared to have not cleared the imported goods namely marble blocks classifiable under heading No. 2515 valued at Rs. 59,07,768/- even after expiry of the period of 30 days as stipulated under Section 48 of the Customs Act, 1962. Accordingly, seven Show Cause Notices having different dates were issued to the importer – appellant as well as to any other person making any claim on the goods. During the course of personal hearing the importer claimed that as they were facing acute financial crisis, a request was made for granting time till 31/10/2012 for taking clearance of the goods. The Adjudicating authority vide order-in-original dated 26/11/2012 ordered for confiscation of the impugned goods in 16 containers under Section 111(d) of the Customs Act, 1962 with an option to redeem the goods on payment of redemption fine of Rs. 20,00,000/- under Section 125 of the Customs Act, 1962 and imposed a penalty of Rs. 10,00,000/- under Section 112 of the Customs Act, 1962 on the importer feeling aggrieved, the importer filed an appeal before the Commissioner (Appeals).
Thus after carefully examining the rival arguments, though CESTAT are of the considered view that once confiscation of the goods is held to be valid in any proceedings, the property in the goods is vested in the Government and the sale proceeds being the total consideration of such property, as a natural corollary such sale proceeds will represent the confiscated goods. Once the confiscated goods allowed to the redeemed on a redemption fine, the sale proceeds which represent the goods, will be paid to the importer only after deduction of such fine. Thus, the redemption fine is to be charged from the importer while releasing the goods, the same also needs to be recovered from the sale proceeds which represent the consideration of the property.
However, in view of the contradicting decisions on the matter at hand by the benches of the Tribunal, CESTAT refer the matter to Larger Bench on the issue “whether the redemption fine and penalty, if any, imposed in the adjudication order needs to be recovered from the sale proceeds, if the confiscated goods are sold/disposed of by auction during the pendency of appeal”.
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