#confiscation of goods

CESTAT Chennai rules that payment of differential duty and interest under the EPCG Scheme extinguishes liability for confiscation and penalty, provided there is no evidence of diversion or deliberate breach. The ruling clarifies that procedural lapses without mens rea do not warrant punitive action, offering relief to importers facing export obligation defaults.

CESTAT rules that penalties under Rule 26 of the Central Excise Rules cannot be imposed unless there is a prior finding that the goods are liable to confiscation. The tribunal invalidated penalties where the adjudicating authority failed to establish confiscation liability, setting a precedent for procedural compliance in excise penalty cases.