ORDER
Gowri Shankar, Member (T)
1. Appeal taken up for disposal with consent of both sides after waiving deposit.
2. Appellant is an agent in Mumbai of ships owners the names of which could not be disclosed to us by its representative. A considerable portion of cargo imported on such ships is in marine freight containers. In the normal course, these containers are exported, either empty or, generally, with export cargo after the imported goods then have been destuffed. To facilitate movement of such containers the Government has by Notification 104/94 exempted such containers when imported from duty subject to the condition that the importer undertake to re-export them within six months from the date of importation and furnishing evidence thereof. The notification empowers the Assistant Commissioner to extend the time within which such re-export may be permitted.
3. The appellant, on behalf of its principal, executed a bond in 1996 for re-export of such containers. A number of such containers covered by the bond could not be re-exported within six months and extension of two months which was granted. Despite this, a number of containers were not re-exported. Accordingly a notice was issued to the appellant on 19.11.1997 proposing to recover the duty in terms of the bond. After giving the appellant some more time the Commissioner has in the order impugned in this appeal confirmed demand for duty on 43 containers which he finds have not been re-exported, ordered their confiscation under Clause (a) of Section 111 with an option to redeem them on fine of Rs. 7 lakhs and imposed penalty of Rs. 70,000 under Section 112 of the Act.
4. The representative of the appellant says that it is not within the appellant’s control to always ensure that the containers are re-exported within the period specified. He says that there is often a delay in clearing the goods imported in such containers. The appellant had been pursuing the matter with the importers of the goods to have the containers released. He says that as of today all but four containers have been re-exported. He undertakes to produce before the Commissioner satisfactory evidence of the re-export of all the containers failing which duty due on them will be paid. He says that the goods ought not to have been ordered to be confiscated on the ground that there is no mala fide intention. He questions the imposition of penalty on the same ground.
5. The departmental representative adopts the reasoning in the impugned order. He says that confiscation has rightly been ordered for contravention of Section 111(o) and that sufficient time has been granted to the importer to produce evidence of re-export.
6. We are not entirely satisfied with the explanation put forth, that the delay in re-exporting the goods is beyond the appellant’s control. Even if there was some delay in clearance of cargo, the appellant could have taken steps to have the cargo restuffed and to export the containers. However if, as is contended all but four have been exported, the provisions of notification have been substantially complied with. We also take note of the submission that out of 96 containers in question 62 containers containing cargo of DCM Daewoo, an automobile manufacturer whose cargo could not be cleared because of financial difficulty caused by acute recession in the automobile market. In these circumstances, we are of the view that the Commissioner should have extended period of time. The fact that almost all the goods have been exported justifies setting aside the confiscation. Since, we do not find any deliberate intention on the part of the appellant to export the goods and agree that to some extent, the delay in re-export was due to the fact beyond its control, we do not find any justification for imposition of penalty.
7. The appeal is allowed and impugned order set aside. The representative of the appellant says that he will produce to the Commissioner evidence of the shipment of the containers within a month of receipt of this order and will deposit the duty on containers not exported. The Commissioner shall accordingly adjudicate on the matter according to law.