Per P. Karthikeyan : M/s. New Bombay Exports imported 10 M.Ts of cloves declared to be of Srilankan origin and of value of Rs. 5,86,810/- under a Bill of Entry dated 02.06.98. Goods originating from SAARC countries are subject to a preferential rate of import duty. The goods under import, on test by the Senior Scientist of Spices Board, was found to be not of Srilankan origin. The markings on the gunny bags indicated the goods to be of Madagascar origin. Moreover, there were discrepancies in dates figuring on the packing list and the related invoice. There was a discrepancy in the container number. Therefore, after due process of law, the original authority confiscated the consignments under Section 111 of the Customs Act and offered an option to redeem the goods on payment of a fine of Rs. 50,000/-. He also imposed a penalty of Rs. 50,000/- on the importer M/s. New Bombay Exports under Section 112 of the Customs Act.

2. In the impugned order, the Commissioner (Appeals) set aside the order of the original authority. He found that the country of origin of the impugned goods had been decided by the original authority on the basis of the opinion of an expert and not on the basis o