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Issues: Imposition of penalties under Section 112 of the Customs Act, 1962 on the appellants for clearance of a consignment containing undeclared medicines.
Facts: The appellants, registered as authorized courier agents, filed a bill of entry for a consignment declared as documents but found to contain medicines. Show cause notices were issued for penalties under Section 112. Lower authorities upheld penalties, leading to the appeals. Appellants' Arguments: The appellants claimed they acted in good faith by filing the bill of entry based on information received from the consignor. They argued that penalties under Section 112 require specific sub-clauses to be invoked, citing legal precedents to support their position. Respondent's Arguments: The respondent contended that as authorized courier agents, the appellants should have filed a proper bill of entry and obtained necessary authorizations. They argued that penalties under Section 112 were justified despite the absence of specific sub-clauses in the show cause notice. Analysis: Section 112 of the Customs Act pertains to penalties for improper importation of goods liable for confiscation under Section 111. The consignment in question was indeed liable for confiscation under Section 111, establishing the basis for penalty imposition. Regulatory Compliance: The appellants, as authorized courier agents, were obligated to exercise due diligence per Regulation 13 of the Courier Import and Export (Clearance) Regulations, 1998. Failure to provide correct consignee information and lack of diligence justified penalties under Section 112. Employee Penalty: The penalty imposed on the employee of the courier company was deemed unwarranted as he lacked knowledge of the goods' true nature. The employee's penalty was set aside based on the manifest provided by the original forwarding company. Appellant Courier Company Penalty: While the company displayed laxity in regulatory compliance, their lack of awareness regarding the consignment's contents was evident. The penalty under Section 112 was deemed appropriate but excessive, leading to a reduction from Rs. 1,00,000 to Rs. 50,000. Conclusion: The penalties on the appellants and the employee were analyzed, resulting in the reduction of the company's penalty. The appeals were disposed of accordingly.
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