The Banglore Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has reduced the redemption fine from Rs. 5 Lakhs to Rs. 2 Lakhs on re-export of Cocoa Beans.
The bench of Pullela Nageswara Rao (Technical Member) has observed that on recall of the goods by the Authorised Officer and after the issue of the show cause notice, the Adjudicating Authority as per the request of the appellant permitted re-export of the impugned goods on payment of redemption fine and penalty.
The appellant/assessee imported ‘Cocoa Beans’ from Indonesia and filed 2 Bills of Entry along with the certificates of quality and test reports from the foreign suppliers indicating various characteristics along with grade limits. The test reports show that the imported ‘Cocoa Beans’ met the standards prescribed in Indonesia, which is “SNI 2323:2008 for Grade: I-B”. SNI is the Indonesian National standards for products, which are manufactured or imported into Indonesia.
On import the Department issued an examination order directing to produce clearance under FSS Act or Regulations, or a no objection certificate (NOC) from the Authorized officer, FSSAI, Cochin.
The Authorized Officer subjected the Cocoa Beans to test under Clause 2.2 of the Food Safety and Standards (Contaminants, Toxins and Residues) Regulations, 2011 and a further test was conducted under the category of ‘Dry Fruits and Nuts’ under Clause 2.3.47.5 of the Food Safety and Standards (Food Product Standards and Food Additives) Regulations 2011.
The Test Report was issued that the ‘cocoa bean’ does not satisfy the specification of the approved standards. Contending that no standard has been fixed under FSS Act or Regulations for the ‘cocoa beans’, the only standard available is under BIS, the test report was challenged by the Appellant in Writ Petition No. 22987/2014 before the High Court of Kerala.
The Authorized officer informed the appellant for drawing samples from the premises of the appellant on 19.03.2015 in compliance of the Division Bench judgment of the High Court of Kerala. The Export Inspection Agency (EIA) issued Analysis Report and the opinion of the test report was the sample cocoa beans does not conform the requirement as laid down in “IS 8865:2003 for the above listed parameters.
Basing on the result of the EIA Test report the Authorised Officer issued a notice for recalling of all the products covered under the 4 Bills of entry on the ground that the samples do not conform to the requirements laid down in IS 8865:2003.
Show Cause Notices were issued under Section 124 of the Customs Act, 1962 by the Customs for the impugned imports. The Adjudicating Authority passed the impugned order dated 08.07.2015, confirmed the allegations made in both the Show Cause Notices and ordered confiscation of imported ‘Cocoa Beans’ and imposed redemption fine of Rs. 15,00,000 and penalty of Rs. 5,00,000.
The appellant has filed the appeal for waiver of fine and penalty imposed by the Adjudicating Authority, while allowing the re-export of the goods.
The tribunal held that the redemption fine and penalty imposed by the Adjudicating Authority could be considered for reduction. The redemption fine is reduced to Rs. 5,00,000 and penalty to Rs. 2,00,000.
Case Details
Case Title: M/s. Mondelez India Foods Ltd. Versus Commissioner of Customs
Case No.: Customs Appeal No. 22140 of 2015
Date: 24.12.2024
Counsel For Appellant: Syed Peeran
Counsel For Respondent: Rajesh Shastry
