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Commissioner of Customs v. M/s. Atul Automations Pvt. Ltd.

Civil Appeal · 2019 INSC 90Decided 24 Jan 2019
Civil Appeal No. 1057 of 2019
Chief Justice Ranjan Gogoi · Justice Navin Sinha · Justice K.M. Joseph

Background

The respondents imported used multi-function devices (digital photocopiers/printers) without the import authorisation required under the Foreign Trade Policy. Customs authorities detained the consignments, treating them as restricted "other wastes," and imposed redemption fines and penalties. The Customs Appellate Tribunal and the High Court both allowed release of the goods on payment of a redemption fine rather than ordering confiscation or re-export, prompting the Revenue's appeal to the Supreme Court.

Decision Breakdown

The Court held that the imported machines, though imported without authorisation, were "restricted" (not "prohibited") items under the Foreign Trade Policy and the Hazardous Wastes Rules, since they still had a usable life of 5-7 years as certified by a Chartered Engineer. Reading the Foreign Trade Act together with Section 125 of the Customs Act, the Court upheld the authorities' discretion to permit release of such goods on payment of redemption fine at market value rather than mandating re-export or confiscation. The appeals filed by the Commissioner of Customs were dismissed, affirming the Tribunal and High Court's view.

Lesson Learnt

Importing used/restricted goods without proper authorisation does not always mean automatic confiscation: if the goods are "restricted" rather than outright "prohibited" and still have genuine economic utility, customs law allows their release on payment of a redemption fine.

Official source (sci.gov.in)View Judgment (PDF)

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