Full Judgment
They import watch components, movement, for the said activity & placed orders with one M/s. Ravi Diffuser. Goods were despatched by Air Cargo and B/E was filed in Ahmedabad for clearance under a Quantity Based Advance License on Release Advise obtained from Kandla Custom House.
2. On examination, the goods were (SIC) not as per the invoice. By letters dated 14.03.98 & 17.3.98, the supplier explained that the goods were an incorrect shipment.
3. Since only components and raw materials i.e. 10,000 pieces of Quart/ Analogue Watch movements like button cell, hour wheel key stem, fixing washer, handset, cases, dial, knobs and metal bands separately were permissible for import and as goods under import was found to be complete watches and clocks in SKD condition & the 14 pcs. of Mechanical Movements imported, they were not permissible to be imported without a licence, the clearance of benefit of Notfn. No. 149/95 duty free against the license produced was alleged to be not available & for the act of their import the appellant was liable & goods for action under Section 111 (m) & 111(d).
4. The appellant submitted that they had ordered for goods as permissible and for despatched goods, sent by mistake, they are not willing to take delivery, they requested permission to send the same back and no penalty or them was called.
5. Commissioner ordered the confiscation of goods under Section 111(d) of the Custom Act and allowed Re-export on fine of Rs. 6 Lakhs and imposed penalty of Rs. 2.5 Lakhs on the importer. Hence this appeal.
6. The plea that licence permits the imports of all components & SKD imports is also imports of components & goods are covered by the licence produced would not call for confiscation and relying on Akbar Badruddin Jiwani (1990(47) ELT 161) & State of Orissa 1978 (2)ELT (1159) (S.C.) penalty is not called are pleas which have not been considered by the lower authority. The lower authority has found no malafides in the request for reshipment, instead he has found that the request has force and has permitted reshipment. The liability to confiscate the watch composed imported in such condition, without a licence, calls for violation of Section 111(d) & confiscation. The redemption fine given for export, of Rs. 6 Lakhs, without challenging the assessable value declared for movement and parts is on the higher side. Redemption fines are to be related to and determined on Margin of Profit. On effecting exports there would no Margin of profit. The fine is therefore reduced to a token fine of Rs. 25,000/-. There is no cause for a penalty on the importer, when the bonafide of the mistake shipment claim is not being found to be questioned by the adjudicator.
Relying on the fact of reshipment being allowed, the penalty is set aside. The reshipment to be effected within a period of one month from the date of receipt of the order.