2026-VIL-1601-CESTAT-ALH-CU
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CUSTOMS CESTAT Cases

Customs - Misdeclaration of goods, Concealment of undeclared branded goods, Violation of Intellectual Property Rights Enforcement Rules, Confiscation under Sections 111 and 118 of Customs Act – Consignment was found to be grossly mis-declared in quantity, description and value. Large quantities of branded goods of internationally recognized brands were concealed within the declared goods without any purchase order or NOC from brand owners. Importer claimed goods were wrongly shipped by supplier due to packing mistake - Right holders of branded goods joined the proceedings and submitted technical reports requesting strict action against the importer – Whether goods that were mis-declared and contained undeclared branded goods in violation of Intellectual Property Rights Enforcement Rules can be confiscated and penalty can be imposed under Section 112 of Customs Act – HELD – Goods are liable to confiscation under Section 111 of Customs Act as they were used to conceal and smuggle prohibited branded goods and were imported in violation of IPR Enforcement Rules. The importer who claimed innocence and attributed goods to supplier's mistake presented an afterthought defense which was not supported by any contemporaneous documentary evidence such as invoice, purchase order or any shipping documents - The Customs authority correctly followed procedures of IPR Enforcement Rules by informing brand owners and obtaining their technical reports. The goods were seized in presence of the importer and independent witnesses. The importer cannot claim innocence when clear breach of IPR rules was established and large quantities of undeclared branded goods were found without any authorization from brand owners - Redemption originally imposed is found to be excessive and was reduced to 10 percent of declared assessed value. Penalty of Rs. 4 lakhs originally imposed under Section 112 of Customs Act for misdeclaration and violation of IPR rules is found to be excessive and reduced to Rs. 2 lakhs as the statutory violation was established though full quantum of penalty was not warranted – Order of confiscation of branded goods is upheld - The appeal is partially allowed
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