V.P. Gulati, Member (T)

1. This appeal is against the order of the learned Collector of Customs (Appeals), Madras. Under the impugned order confiscation of a container load of diesel engines has been upheld and the appellants have not been given any option for redemption of the same.

2. In the proceedings before the learned original authority the appellants were also charged with mis-declaration of value and the value of the goods was enhanced from the declared value of Singapore dollars 20250 equivalent to Indian Rs, 3,77,865 on appraisal by the Customs authorities to Rs. 9,90,146/-. The learned lower appellate authority by the impugned order has set aside the order of enhancement of the value, while upholding the order of confiscation of the goods.

3. The learned Advocate for the appellants pleaded that the goods imported were second-hand diesel engines intended for different models of the cars and had been imported under the bona fide belief that the same were allowed for import in terms of Import Export Policy 1992-97. He pleaded that appellants were guided by the Import Trade Control Order No. 1/92-97 issued under Section 3 of the Imports and Exports (Control) Act, 1947. He pleaded under this Import Control Order, which is by way of an amendment to the Import (Control) Order, 1955, all goods of the description specified in Schedule I are allowed to be imported freely except the goods which are covered under Prohibited Items, Restricted Items and Canalised Items under the Negative List of Imports in Chapter XV in the Export and Import Policy 1992-97 and that import of goods in second-hand condition including waste, scrap, etc. could be made without a licence. He pleaded the understanding of the appellants was that all second-hand goods could be imported so long as these were not specifically prohibited or restricted for import. He pleaded that the diesel engines as such are not prohibited items under the Import Export Policy 1992-97 by specific mention therein. At this stage he was asked to state under which category of goods the diesel engines imported would fall. He pleaded that these would be in the nature of consumer goods and not capital goods. The learned SDR for the Department also pleaded that diesel engines have to be considered as only consumer goods. The learned Advocate was asked, therefore, in this context to refer to the Policy governing the consumer goods and after referring to the Policy he conceded that the consumer goods were listed under the list of Restricted Items. He, however, pleaded that the amended Import (Control) Order, referred to above, appeared to allow the import of second-hand goods of all categories without licence. He pleaded that in any case, without admitting that the goods are not permissible for import, the absolute confiscation of the goods was not called for. He pleaded that the Customs authorities had been allowing release of the second-hand diesel engines all along on levy of varying redemption fines and in this connection he referred us to the list of such items which were allowed to be released on redemption fines. The list is reproduced below for convenience of reference :

He also cited the case of M/s. S. Regina Imports Exports, where the Additional Collector of Customs, Madras, by his adjudication order No. 95/92-App. dated 28-7-1992 has allowed the redemption of the goods valued at Rs. 1,47,640 on redemption fine of Rs. 6,00,000. He pleaded this fine was reduced by the High Court on a writ petition filed by the importers viz. M/s. Regina Imports Exports to Rs. 3,00,000 for the purpose of clearance of the goods. He pleaded that the import in this case also pertains to the same period as that of the appellants.

4. The learned SDR pleaded that inasmuch as consumer goods figure in the list of Restricted Items, a licence is required for the import of the same and the same not having been produced the goods have been correctly confiscated by the lower authority. He pleaded