S.S. Sekhon, Member (T) - (1.)THE appellants are importers of Poppy Seeds who had filed Bill of Entry for total quantity of 112 M.Ts. of Poppy Seeds covered under Contract No. 087/94 dated 7.9.1994 and sought clearance of the goods under OGL, as the same was not appearing in the negative list of ITC Policy 1992 -97. On examination, the goods imported tallied with the declaration made by the appellants except an excess quantity of 70 kgs. The Department refused clearance as they viewed that the said licence as per Para 156 -A of Exim Policy 1992 -97 being consumer goods was required and also found value of goods to be at Rs. 13.56 per kg. as against the price declared at Rs. 13.00 per kg. The Collector of Customs confiscated the goods under Section 111(d) of the Customs Act. The Collector of Customs, however, gave an option to the appellants to redeem the fine of Rs. 5,00,000 in lieu of confiscation and also levied a personal penalty of Rs. 1,50,000. The present appeal is filed against this order.
(2.)THE grounds taken are - -
(a) The Poppy Seeds imported are consumer goods as per Para 156 -A of Exim Policy 1992 -97. Further the Collector has not given any reason for holding how they could be consumer goods and why the Poppy Seeds could not be raw material for the manufacture of Unani and Ayurvedic medicine and extracting of Poppy Seed Oil for export. When the Licencing Authority is considering that Poppy Seeds are raw materials and Collector has not denied that the Advance Licences have been issued for import of Poppy Seeds for extraction of Poppy Seed Oil.

(b) Even if there are alternative uses, the Customs department has no jurisdiction for interdicting clearance of the goods, if it can be used for manufacture of other items. The Collector has not considered the Poppy Seeds were not specified in the Negative List under Para 156(A) and hence confiscation under Section 111(d) of the Customs Act was not called for. The findings of the Collector that the goods are covered under 156(A) of the I.T.C. Policy 1992 -97 is totally without any basis as there is no discussion on the same.

(c) The value declared by them at Rs. 14,50,853 per MT for the Poppy Seeds imported is incorrect and the Collector of Customs ignored to take it into consideration. Rules 3 and 4 of the Customs Valuation Rules 1988 enjoin him to accept the transaction value. Since no amount has been paid in addition to the value, there is no ground to raise value at Rs. 13.56 per Kg. They relied upon the decision of the Collector of Customs, Bombay v. S.S. Enterprises 1994 (74) ELT 794 (SC).

(d) Redemption fine and personal penalty levied are excessive and, therefore, prayed for setting aside the order.

(3.)WHEN the matter was posted for hearing, the notice were returned by postal authorities with the remark 'addressee was not known', at the address given on record. However a letter dated 19.6.2002 from Shri E.S. Govindan, Advocate, Chennai was received and placed by the Registry before us. This letter stated he was not in a position to come down to appear before the Bench and the appeals may be decided on merits on the grounds as pleaded by the appellants. We have heard the Departmental Representative and considered the matter on record and find - -
(a) In the case of Harpreet International v. Commissioner of Customs, Amritsar (Tribunal -L.B.), the Larger Bench of this Tribunal has held that the import of Poppy Seeds during the period 1996 -97 redemption fine imposed by the Tribunal was 85% of the C.I.F. value and also held that import of Poppy Seeds without licence was objectionable and for that liability can be fastened on the importer. Therefore, we find, following this decision, confiscation under Section 111(d), in this case has to be upheld.

(b) The learned DR has submitted, Poppy Seeds and consignments of the same have been subject matter of catena of decisions of the Tribunal and have been allowed clearances only on redemption fine during the ITC policy period as in this case.

(c) We find from the impugned order that the Commissioner has determined the value of the goods at Rs. 15,90,659 and redemption fine under Section 111(d) and (m) which found goods liable for confiscation of Rs. 5 lakhs, i.e. less than 30%. Since the Larger Bench has held that the Tribunal was imposing redemption fine during the period 1996 -97 at 85% of the C.I.F. value, we do not find any reason to find that redemption fine, approximately, less than 30% would be excessive as submitted by the appellants. We therefore do not find any cause for reduction of redemption fine. As regards penalty of Rs. 1,50,000 imposed, we find that during the year 1995 and subsequent year 1996 -97, the imports were not permissible. We, therefore, cannot agree to the reduction of redemption fine and penalty, as arrived at by the Larger Bench, which in that case considered that subsequently Popply Seeds were covered under OGL. There is therefore, no case for reduction of penalty in this case. We therefore do not find any ground to interfere with the issue of fine and penalty as arrived at by the Commissioner in this appeal.

(d) As regards valuation, we find that in para 3 of the order, the Commissioner has gone by the price of such goods noticed at 1 CD (Bangalore) and has loaded the price. No material is available in this appeal as to how this comparison is not permissible. We find no material in this appeal to upset the order on valuation.