JUDGMENT : M.R. Shah, J. 1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 18th October 2005 passed by the Customs, Excise & Service Tax Appellate Tribunal, West Zonal Bench, Mumbai (hereinafter referred to as, "the Tribunal") in Appeal Nos. CD/949, 987, 395 & 503/86 by which the learned Tribunal has allowed the Appeals preferred by the respondent herein (original appellant) and has set-aside the demand of duty on the goods seized and consequently confiscated under Section 111 (m) and 111 (o) of the Customs Act, 1962, the Revenue has preferred the present Appeal to consider the following substantial questions of law : "(i) Whether in the facts and circumstances of the case, the Hon'ble Tribunal was right in law in passing the order for setting aside the demand for duty on the goods (4536 bales of PSF) as they were seized after custom clearance and absolutely confiscated under Section 111 (m) and 111 (o) of the Customs Act, 1962 ? (ii) Whether the Tribunal committed an error in interpreting the provisions of Section 12 of the Customs Act, 1962 by setting aside the duty on the absolutely confiscated goods which were already cleared from the customs notified area by the respondent claiming benefit of Notification No. 117/78 dated 08.06.78 ? (iii) Whether it is legally valid and correct not to charge duty when goods are absolutely confiscated, while in terms of provisions of Section 125 of the Customs Act, 1962 in the case of goods confiscated but permitted to be redeemed against fine, duty on the goods is payable in addition to fine ? (iv) Whether the liability to pay duty under Section 12 of the Customs Act, 1962 is independent of the liability under various punitive provisions of the Act, in view of the decision of Hon'ble Supreme Court reported at 1983 (13) ELT 1562 SC ?" 2. Facts leading to the present Appeal in nutshell are as under : 2.1 That, M/s. L.D Textiles Industries Limited obtained two advance licenses under the Duty Exemption Scheme envisaged in Appendix 19 of the 1983-84 Import Policy. These licenses were 2962655 dated 5.8.1983 for 512.50 M/Ts of Man-made fibres and 2963408 dated 4.6.1984 for 2050 M/Ts of Man-made fibres with duty exemption benefit within the overall limits of 550 and 2200 M/Ts. respectively. These licenses were 2962655 dated 5.8.1983 for 512.50 M/Ts of Man-made fibres and 2963408 dated 4.6.1984 for 2050 M/Ts of Man-made fibres with duty exemption benefit within the overall limits of 550 and 2200 M/Ts. respectively. One of the conditions of these licenses was that the licence holder should export 500 MT of man-made spun yard of Rs. 75 lakhs of f.o.b value and 2000 Mts of man-made spun yarn valued at US $ 29,00,000/=, as envisaged by the DEEC Scheme. Against the first import licence M/s. L.D Textile Industries Limited imported 2050 bales of manmade fibres of net weight 512.50 M/Ts valued at Rs. 82,71,459/= under Bill of Entry No. 63 dated 30.3.84 per M.T Strathfyne at Veraval Customs House and cleared the same for home consumption. The representative sample of the goods from the consignment was drawn by the Veraval Custom House and was tested in the Custom House Laboratory at Kandla which gave the result that the goods were wholly man-made fibres of cellulosic organic (viscose). The consignment was cleared free of duty under the Customs Notification No. 117/78 dated 9.6.78 as amended. For availing of exemption under this Notification, the importers were issued the Duty Exemption Entitlement Certificate (DEEC) Book No. 5088/Kandla dated 6.8.83. This import entailed the export obligation of shipping 500 M/Ts of yarn spun out of imported man-made fibres of British counts 15s ranging to 60s of f.o.b value of Rs. 75,00,000/=. However, the importers could not fulfill the export obligation and they by their letter dated 26.2.85 signed by Shri Yogesh Mehra addressed to the Superintendent of Customs, Veraval intimated that due to our non ability to comply with the export obligation, forced by factors beyond our control, since there was an illegal strike at our factory at Ankleshwar, which lasted more than 90 days, we were not in a position to manufacture and ship our goods on time. They thus paid the duty of Rs. 62,84,656.54 by bank draft drawn in favour of Veraval Customs. 2.2 Against the second licence No. 2963408 dated 4.6.84, M/s. L.D Textile Industries Limited imported two consignments of 3100 and 3000 bales weighing 812 M/Ts and 750 M/Ts valued at Rs. 1,51,09,631/= and Rs. 1,30,30,004/= respectively per m.v. Strathfyne and cleared them under Bill of Entry No. 22 dated 30.10.84 and 23 dated 30.10.84 respectively. 2.2 Against the second licence No. 2963408 dated 4.6.84, M/s. L.D Textile Industries Limited imported two consignments of 3100 and 3000 bales weighing 812 M/Ts and 750 M/Ts valued at Rs. 1,51,09,631/= and Rs. 1,30,30,004/= respectively per m.v. Strathfyne and cleared them under Bill of Entry No. 22 dated 30.10.84 and 23 dated 30.10.84 respectively. The samples were drawn from these two consignments and sent to the Kandla Customs House for test. The test reports revealed that the goods were dull whit entangled mass of short staple fibre (discontinuous) wholly made of man-made fibres of cellulosic origin (Viscose). These two consignments were also cleared free of duty vide the Duty Exemption Entitlement Certificate Book 7003/Kandla 4.6.84 and in terms of the aforesaid Customs Notification No. 117/78 dated 9.6.78 as amended. These two imports entailed export of 2000 Mts of spun yard made out of man-made fibre valued at US $ 29 lakhs within a period of six months from the date of clearance of first consignment in India against the advance licence. 2.3 Prior to 13.3.85, the Customs Authorities of Ahmedabad Collectorate received information that M/s. L.D Textiles Industries Limited, Ankleshwar had imported large quantities of polyester staple fibres under the advance licence scheme and they were selling the same in the open market through mis-declaration of goods as non-cellulosic synthetic waste. The information further indicated that the goods sold were being sent to the truck under cover of fictitious consignees. On 13.3.85, a specific information was received that one truck containing 40 bales of polyester staple fibre was leaving Ankleshwar for Ahmedabad. Thereafter, the truck driver was given fictitious documents describing 40 bales as non cellulosic synthetic waste and he was directed to take the lot to Bhiwandi via Bombay and hand over the goods near a Petrol Pump to a person who would produce a copy of the said consignment note. This was done and the said 40 bales were handed over and transferred to an another truck having Kerala registration. 2.4 These facts confirmed the information received against M/s. L.D Textile Industries Limited that they were selling the goods imported by them under the advance licence scheme. Accordingly, the Headquarters preventive party was sent to Ankleshwar on 14.3.85 to check the stock and accounts of M/s. L.D Textile Industries Limited of the fibre imported by them in terms of the Duty Exemption Export Entitlement Scheme. Accordingly, the Headquarters preventive party was sent to Ankleshwar on 14.3.85 to check the stock and accounts of M/s. L.D Textile Industries Limited of the fibre imported by them in terms of the Duty Exemption Export Entitlement Scheme. The check of the accounts revealed that their books of accounts showed Nil balance of the raw materials imported by them. Therefore, their godowns was searched and the search yielded 2275 bales of polyester fibre of different makes. These bales included 365 bales of polyester staple fibre imported by M/s. L.D Textile Industries Limited in April 1984. All these 2275 bales were seized under Panchnama dated 15.3.85 as the same were liable to confiscation. Further inquiries revealed that the importers were having another godown outside their factory premises in Shed No. A-1/7307. On search of this godown, it was found that it contained 1837 bales of Korean Polyester staple fibre of brand "Eslon". These 1837 bales were also seized under a panchnama dated 15.3.85, the Customs Officers also seized records relevant to the enquiry, recorded statements and conducted investigations. The scrutiny of the seized documents revealed that M/s. L.D Textiles Industries Limited sold or transferred 1978 bales to different parties including the other captioned appellants. The investigations further confirmed that these 1978 polyester fibre bales were the same as imported under Bills of Entry No. 63 dated 30.3.84 and Nos. 22 and 23 dated 30.10.84. 2.5 After the investigation were completed the Collector of Customs, Ahmedabad issued the show cause notice dated 22.5.85 and held the enquiry and passed the impugned adjudication order dated 21.4.86 under which he ordered absolute confiscation of 4486 bales plus one bale in loose condition of polyester fibres seized on 15.3.85, 1.5.85 and 3.5.85 from the possession of M/s. L.D Textiles Industries Limited. He also confiscated absolutely 49 bales of polyester staple fibre seized from M/s. P.G Textile Mills Limited on 16.3.85 and also 171 bags of yarn seized from M/s. Arunoday Mills Limited and 6 bales of polyester fibre seized from M/s. Jayashree Textiles Limited. He demanded duty amounting Rs. He also confiscated absolutely 49 bales of polyester staple fibre seized from M/s. P.G Textile Mills Limited on 16.3.85 and also 171 bags of yarn seized from M/s. Arunoday Mills Limited and 6 bales of polyester fibre seized from M/s. Jayashree Textiles Limited. He demanded duty amounting Rs. 4,20,88,370.16 in respect of bill of Entry No. 63 dated 30.3.85 for 2050 bales of polyester fibre after giving the credit of the duty already deposited by M/s. L.D Textiles Industries Limited through the bank draft in favour of Veraval Customs House with their letter dated 26.2.85 and the amount of duty paid by them after the search of their premises in March, 1985. The Collector also demanded interest at 18% on this amount of duty from the date of clearance of the imported consignments through Veraval Customs House, till the actual date of payment of duty. He further demanded duty of Rs. 6,99,91,236.08 in respect of Bill of Entry No. 22 dated 30.10.84 for the Polyester fibre bales with interest at 18% on this amount from the date of clearance of the goods through Veraval Customs House till the date of actual payment of duty. In addition, the Collector of Customs, demanded Customs duty amounting to Rs. 6,32,60,298=30 in respect of Bill of Entry No. 23 dated 30.10.84 covering 3000 bales of Polyester Staple Fibre bales with 18% interest the amount from the date of clearance of the goods till the date of payment of duty. 2.6 The Collector further held that the interest was determined with reference to para 21 of Appendix 19 of the Import Policy for 1984-85. He observed that the duty figures as shown in the show cause notice had not been challenged in the proceedings. He further held that the demands had been ordered under section 28 as well as under Section 143-A of the Customs Act. The demands for the duty in respect of Bills of Entry No. 22 and 23 dated 30.10.84 were made after the provisional assessment of the goods covered by these two Bills of Entry was finalized by the Collector under his impugned order. The order of confiscation and levy of duty was made as part of adjudication without prejudice to the action for levy of penalty on the importers and other respondents, as mentioned in the show cause notice." 3. The order of confiscation and levy of duty was made as part of adjudication without prejudice to the action for levy of penalty on the importers and other respondents, as mentioned in the show cause notice." 3. Feeling aggrieved and dissatisfied with the order passed by the Adjudicating Authority, the respondent herein preferred appeals before the learned CESTAT. By the impugned common judgment and order, the learned Tribunal has though confirmed the order of confiscation of the goods seized, however, has set-aside the demand of duty on the goods seized and thereafter confiscated under Section 111 (m) and 111 (o) of the Act. 4. Feeling aggrieved and dissatisfied by the impugned common judgment and order passed by the learned Tribunal in quashing and setting aside the demand for duty on the confiscated goods, the Revenue has preferred the present Tax Appeal. 5. Heard Ms. Avni Mehta, learned counsel appearing on behalf of the Revenue. Though served, no body appears on behalf of the respondent. 6. The present Tax Appeal is of the year 2006 and as such arising out of the show cause notice issued in the year 1995 and arising out of the order-in-original passed by the Collector of Customs, Ahmedabad dated 21st April 1986, we proceed ex parte. 7. Ms. Avni A Mehta, learned counsel appearing on behalf of the Revenue has vehemently submitted that in the present case, the learned Tribunal as set-aside the demand of duty on the goods in question solely on the ground that they were seized after the customs clearance and actually confiscated under Section 111 (m) and 111 (o) of the Customs Act, 1962. It is submitted that the questions involved in the present Tax Appeal are as such squarely covered and the issue is no longer res integra in view of the decision of the Hon'ble Supreme Court in the case of Union of India & Ors. v. Security & Finance (P) Limited, reported in 1984 (13) ELT 1562 (SC). It is submitted that in the said decision, the Hon'ble Supreme Court has observed and held that the action/proceedings under Section 111 and 125 are altogether different and they can be said to be penal provisions and despite the confiscation of goods under Section 111 of the Customs Act, the liability to pay duty on the confiscated goods still continues. It is submitted that in the said decision, the Hon'ble Supreme Court has observed and held that the action/proceedings under Section 111 and 125 are altogether different and they can be said to be penal provisions and despite the confiscation of goods under Section 111 of the Customs Act, the liability to pay duty on the confiscated goods still continues. It is submitted that in the present case, the demand of duty on the goods in question have been set-aside by the learned Tribunal solely on the ground that once the goods were seized, after customs clearance and they were actually confiscated under Section 111 (m) and 111 (o), there cannot be any further demand of duty. It is submitted that therefore, in light of the decision of the Hon'ble Supreme Court in the case of Security & Finance (P) Limited (Supra), the present Tax Appeal is required to be allowed and the impugned judgment and order passed by the learned Tribunal deserves to be quashed and set-aside and the demand of duty on the goods in question is required to be confirmed. 8. We have heard learned counsel appearing on behalf of the Revenue and perused the impugned judgment and order passed by the learned Tribunal. A short question which is put for our consideration is as to whether in the facts and circumstances of the case, the learned Tribunal is justified in setting aside the demand of duty on the goods on the ground that though they were seized after customs clearance and absolutely confiscated under Section 111 (m) and 111 (o) of the Customs Act ? Considering Sections 111 and 125 of the Act, it appears that both are penal in nature. The liability to pay duty has nothing to do with confiscation of the goods under Section 111 and/or under Section 125 of the Act. Under the circumstances, the learned Tribunal has materially erred in setting aside the demand for duty on the goods solely on the ground that they were seized after the customs clearance and absolutely confiscated under Section 111 (m) of the Customs Act. 9. Identical question came to be considered by the Apex Court in the case of Security & Finance (P) Limited (Supra). In the case before the Hon'ble Supreme Court, fine in lieu of confiscation under Section 183 of the Sea Customs Act was ordered by the Dy. 9. Identical question came to be considered by the Apex Court in the case of Security & Finance (P) Limited (Supra). In the case before the Hon'ble Supreme Court, fine in lieu of confiscation under Section 183 of the Sea Customs Act was ordered by the Dy. Collector of Customs, who also imposed and directed payment of full duty on the goods imported. The question arose before the Hon'ble Supreme Court was, "does the order under Section 183 of the Act preclude the Collector from levying duty under Section 20 of the Act ?" While holding the same in affirmative, it is held and observed that the levy of duty and the order of confiscation both operate in a different field. It is further observed that the import duty has to be paid inevitably by the importer. Confiscation or fine in lieu thereof is an infliction on the offender or circle of offenders. It is also observed that sometimes, the burden in both the cases, falls on the same person and at the other times, they may fall on different person. In para 7, 8 and 10 of the decision, the Apex Court has observed and held as under :- "7. Import duty has to be paid inevitably in these cases, by the importer confiscation or fine in lieu thereof is an infliction on the offender or circle of offenders falling within Section 167 Entry 8. Sometimes, the burden in both the cases falls on the same person. At other times, they may fall on different person. In some cases, the importer as well as the confiscatee may be identified and so the duty and the penalty may be imposed validly. In other cases, it may be difficult to get at the actual person who imported or was concerned in the offence of importation contrary to the prohibition or restriction clamped down by the law. In that event, only confiscation and, alternatively, fine may be imposed. 8. Viewed in this perspective, the answer to the question that arises for decision is simple. In the present case, as held by the High Court, the respondent did import auto cycles pedals outside the permit or licence. He is therefore liable to pay import duty normally leviable from pedal importers. 8. Viewed in this perspective, the answer to the question that arises for decision is simple. In the present case, as held by the High Court, the respondent did import auto cycles pedals outside the permit or licence. He is therefore liable to pay import duty normally leviable from pedal importers. He has admittedly transgressed the provisions of Entry 8 of Section 167 by importing goods not covered by the licence and therefore comes within the penal complex set out in Sections 182, 183 & 184. In the present case, the Deputy Collector, the competent authority has chosen to give the owner of the goods, the respondent, option to pay in lieu of confiscation, a fine. He has not confiscated the goods and therefore, Section 184 is not operational in this context. In short, the obligation under Section 20 is independent of the liability under Section 183. The order, dual in character, although clubbed together in a single document, is therefore valid in entirety. Even so, the confusion has been caused by the Deputy Collector failing to keep distinct the two powers and the two liabilities and thereby leading to avoidable jumbling. 9. xx xx xx 10. However, we are prepared to gather from the order under attack two levies imposed in exercise of two distinct powers, as earlier explained. The import duty has been made a condition for the clearance of the goods. This is right and it is impossible to say that the said payment is not justified by Section 20. Likewise, the authority, when it imposed a fine, was exercising its power under Section 183. We can readily see that he did not mean to confiscate the goods. He only proposed to confiscate and proceeded to fix a fine in lieu thereof. Non felicitous and inept expressions used in the order are perhaps apt to mislead, but the intendment is clear that what was done was not confiscation but giving an option to pay a quantified fine in place of confiscation. The order was composite one, when read in the sense we have explained, and is quite legal. Therefore, we reach to the conclusion that the appellant is entitled to win and the High Court was in error." 10. In view of the above, the questions raised in the present Tax Appeal are required to be answered in favour of the Revenue and against the assessee. Therefore, we reach to the conclusion that the appellant is entitled to win and the High Court was in error." 10. In view of the above, the questions raised in the present Tax Appeal are required to be answered in favour of the Revenue and against the assessee. Consequently, the impugned common order dated 18th October 2005 passed by the Customs, Excise & Service Tax Appellate Tribunal, West Zonal Bench, Mumbai setting aside the demand of duty on the goods in question deserves to be quashed and set-aside. 11. In view of the above and for the reasons aforestated, the present Tax Appeal succeeds. The impugned common Order No. A/211 to 214/WZB/05 CI (CSTB) dated 18th October 2005 is hereby quashed and set-aside. We answer the questions in favour of the Revenue and against the assessee.