Importer BOPPA Ltd. imported two consignments of ethyl alcohol which were allowed to be cleared for home consumption on execution of a bond undertaking to produce licence within a month. Since, BOPPA Ltd. failed to fulfi

The given case is similar to the case of Hira Lal Hari Bhagwati vs CBI (2003) 155 ELT 433 (SC). The Supreme Court of India had held that no penalty can be imposed if the goods are imported with bona fide belief that they are entitled to exemption, later on they could not fulfil conditions of exemptions but paid the duty. Further it was held that for establishing offence of cheating, complainant (i.e. importer) is required to show dishonest intention at the time of making promise or presentation. Thereby there is no penalty under section 112(a) of Customs Act, 1962. With regard to confiscation of the goods under section 111(d) of Customs Act, 1962, the Supreme Court in the case of Sachinanda Banerji v Sitaram Agarwala 110 ELT 292 (SC), held that goods imported against restrictions under section 11 of the Customs Act, 1962 (section 11 deals with power to prohibit importation or exportation of goods) are liable to confiscation. Therefore, action of the department to confiscate the goods u/s 111(d) of the Customs Act, 1962 is valid.