COMMISSIONER OF CUSTOMS Vs. SUPREME WOOLLEN MILLS

JUDGEMENT

(1.) THE appeal has been filed by the Collector of Customs, Bombay against the appellate order dated 29 -4 -1994 passed by the Collector of Customs, Bombay. The respondents in this case imported a consignment of goods declared as completely premutilated Woollen/Synthetic Rags for the clearance of which they filed Bill of Entry on 27 -1 -1993 in the Bombay Customs House against the import under OGL against para 22 of the Exim Policy 1992 -97. The goods were examined and it was found that 1,022 kgs. out of the total quantity of 22,010 kgs. imported were complete serviceable garments, while the rest of the goods were completely premutilated goods as per the Notification No. 60/88 by the Customs House. Proceedings were initiated against the respondents for mis -declaration under Section 111(m) of the Customs Act, and the Assistant Collector of Customs Group -Ill ordered confiscation of the goods and gave the option of redemption the same on payment of fine of Rs. 17,500/ - and directed the clearance of the goods after being premutilated in consonance with the Public Notice No. 68/88. A penalty of Rs. 50,000/ - was imposed on the Respondents under Section 112 of the Customs Act. The Assistant Commissioner's order was challenged before the Collector of Customs (Appeals) who disposed of the appeal by passing the present impugned order whereby he held that the goods may be allowed clearance after premutilation without any redemption fine. The Collector (Appeals) took the view that once the goods are cleared after mutilation as per the Public Notice, the question of redemption fine will not arise, and that question of redemption fine arises only when the goods are cleared unmutilated.

(2.) SHRI Suman the ld. JDR contended that the goods have to be assessed in the form in which they are imported. A part of the consignment on examination was found to be not premutilated rags but fully serviceable garments, which are costlier and attract higher rat of duty. Therefore the view taken by the Collector (Appeals) that on mutilation the goods may be cleared without fine is erroneous. He also cited and relied upon Division Bench Judgment of the Madras High Court in the case of Vijay Kumar Garg Partner of Agarwal Loomtex v. Union of India -1992 (58) E.L.T. 416 (Mad.) whereby High Court has upheld the adjudication order confiscating consignment of serviceable garments imported along with premutilated garments and levying fine in lieu of confiscation with a direction that on redemption, the garments be cleared after mutilation. The respondents are absent despite Notice.