1. Brief facts are that the appellant imported cloves from Sri Lanka, which was detained by Customs department for the reason that the goods did not
conform to the FSSAI, 2006 and Rules and Regulations made there under. Original authority for re-export of the goods had imposed redemption fine
of Rs.2 lakhs under section 125 of the Customs Act, 1962 and imposed penalty of Rs.50,000/- under section 112(a) of the Customs Act, 1962. Against
this, the appellant filed appeal before the Commissioner (Appeals), who vide order impugned herein reduced the redemption fine from Rs.2 lakhs to
Rs.1 lakh and the penalty was reduced from Rs.50,000/- to Rs.25,000/-. Aggrieved by such order, the appellant is now before the Tribunal.
2. The learned counsel Shri Abdul Nazeer appeared and argued for the appellant. He relied upon the decision in the case of M/s. Sankar Pandi Vs
Union of India reported in 2002 (141) E.L.T.635 (Mad.) to argue that when the goods were redeemed for the purpose of re-export and that the
redemption fine imposed is illegal and requires to be set aside. With regard to the penalty, he submitted that the appellant has suffered huge financial
loss due to the re-export of the goods and also huge demurrage charges. He, therefore, prayed that the penalty may be set aside.
3. The learned Authorised Representative Shri M. Jagan Babu supported the findings in the impugned order.
4. After hearing both sides, it is seen that the redemption fine is imposed only for the purpose of re-export of goods. In the case of M/s. Sankar Pandi
(supra), the Hon’ble jurisdictional High Court has held that no redemption fine can be imposed when the goods are redeemed only for the purpose
of re-export. The said decision has been upheld by the Hon’ble Supreme Court in the case of M/s. Siemens Ltd. Vs Commissioner of Customs
reported in 1999 (113) E.L.T.776 (S.C.).
5. For these reasons, I hold that the imposition of redemption fine of Rs.1 lakh is unsustainable and requires to be set aside, which I hereby do.
6. The learned counsel has also argued to set aside the penalty. The penalty has been reduced by the Commissioner (Appeals) to Rs.25,000/-. Due to
violation of the FSSAI Rules by the appellant for import of the goods, I am of the view that the penalty of Rs.25,000/- [Rupees Twenty Five
Thousands only] is reasonable and I uphold the same.
7. The impugned order is modified to the extent of setting aside the redemption fine only. Appeal is partly allowed in the above terms with
consequential reliefs, if any.
(Dictated and pronounced in open court)
