2007 (7) TMI 528 - AT - Customs

Summary

Issues Involved:
The issues involved in this case are the confiscation of goods provisionally exported, restriction of drawback amount, imposition of penalty on the Customs House Agent (CHA), and the liability of the exporter.

Confiscation of Goods:
The case involved the provisional export of goods under a shipping bill where the duty drawback claimed was found to be exaggerated. The adjudicating authority ordered the confiscation of the goods provisionally exported under the Customs Act, 1962, but allowed redemption on payment of a fine. The appellants contested this order, arguing that the mistake in claiming excess duty drawback was unintentional and due to a calculation error by the CHA clerk. The appellate authority considered the submissions and found that there was no evidence of mala fide intention on the part of the exporter. It was concluded that the confiscation, fine, and penalty imposed were unwarranted, and the order was set aside.

Restriction of Drawback Amount:
The dispute in this case centered around the quantity of drawback claimed on the exports. The CHA clerk mistakenly filled in the weight of batteries instead of the number of batteries in the documents, leading to the incorrect calculation of the drawback amount. The appellate authority noted that there was no intention on the part of the manufacturer to claim excess duty drawback. The adjudicating authority accepted these facts and found no evidence of connivance or attempt by the exporter to avail undue drawback. Consequently, the penalty on the exporter was not warranted, and the order restricting the drawback amount was set aside.

Imposition of Penalty on CHA:
The penalty was imposed on the CHA under Section 114(iii) of the Customs Act, 1962, for the mistake made by the clerk in declaring the quantity of batteries in the export documents. The CHA argued that the error was due to a lack of technical knowledge and understanding of the documents provided by the exporters. However, the appellate authority held that the CHA's actions were binding on the employer, and the lack of proper care in filing the export documents led to the misdeclaration and the claim of undue drawback amount. Therefore, the CHA was held liable for penal action under Section 114(iii) of the Customs Act.

Liability of Exporter:
The exporter, ABB Ltd., was found to have correctly declared the number of batteries and FOB value in the export documents. The appellate authority determined that there was no mala fide intention on the part of the exporter to avail undue drawback. The mistake in claiming excess duty drawback was attributed to the CHA clerk's error, and the exporter was exonerated from any penalty or fine. The appellate authority set aside the confiscation, fine, and penalty imposed on the exporter, as there was no evidence of intentional wrongdoing on their part.