PLASTO FINE INDUSTRIES Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) THESE appeals have been filed against Order -in -Original No. KDL/Commr./16/2008, dated March 31, 2006 passed by the Commissioner of Customs, Customs House, Kandla, imposing penalties on all the appellants. The brief facts of the appeals are that the appellant units procured and exported "castor oil" directly after procuring the same from the units situated in domestic tariff area without following the procedure prescribed under section 11(1) of the Foreign Trade (Development and Regulation) Act, 1992 read with paragraph 18(c) of Appendix 14 -II to the Export and Import Policy, 2002 -07 and Central Board of Excise and Customs Circular No. , dated April 1, 2003 for not taking necessary permission. These acts of the appellants have been held to be a violation of section 113(d) of the Customs Act, 1962 by the adjudicating authority and accordingly penalties have been imposed upon the appellants under section 114(i) of the Customs Act, 1962.

(2.) SHRI B. Rama Rao, (advocate) appearing on behalf of the appellants argued that the impugned goods have not been confiscated by the adjudicating authority and accordingly penalties cannot be imposed upon the appellants under section 114 of the Customs Act, 1962 as per the CESTAT, Chennai Bench judgment in the case of K. Kamala Bai v. Commissioner of Customs and Central Excise : (2005) 186 ELT 459 (Trib. -Chennai). It was also his case that there was no prohibition under the Exim Policy for the export of castor oil and therefore, the provisions of section 113(d) of the Customs Act, 1962 cannot be invoked, especially when the export goods were not confiscated. It was also argued that the appellants had the permissions from the DGFT for trading in castor oil and could procure castor oil from the DTA units and export by such outsourcing. It was argued by the learned advocate that if the export of castor oil is not prohibited under the Exim Policy, the same can not become prohibited because of mere failure on the part of an exporter to abide the condition of the Exim Policy making them liable to confiscate under section 113(d) of the Customs Act, 1962.

(3.) HEARD both sides and perused the case records. The issue required to be deliberated is whether penalties can be imposed upon the appellants under section 113(d) of the Customs Act, 1962. The adjudicating authority has imposed penalties upon all the appellants by holding that "castor oil" exported by the appellants were liable to confiscation for violation of section 113(d) of the Customs Act, 1962. Section 113(d) of the Customs Act, 1962 is reproduced below: