2009 (12) TMI 810 - AT - Customs

Summary

Issues: Rectification of error apparent in the final order reducing penalty imposed under Section 114 of the Customs Act.

The judgment pertains to an application filed by M/s. Passage Cargo Pvt. Ltd. seeking rectification of an error apparent from the records contained in the Final Order Nos. 276 & 277/2009 dated 9-3-2009 of the Tribunal, which partially allowed the appeal filed by the Customs House Agent (CHA) for setting aside the penalty of Rs. 1 lakh imposed under Section 114 of the Customs Act. The Tribunal had reduced the penalty to Rs. 50,000. The lower appellate authority had previously reduced the penalty from Rs. 2 lakhs to Rs. 1 lakh. The appellant challenged the order before the Tribunal on various grounds, including the argument that the lower authorities had not justified the penalty imposed and that only the Commissioner of Customs was competent to initiate action against a CHA under the Custom House Agents Licensing Regulation (CHALR), 2004. The appellant also contended that the Tribunal had not considered the question of law raised in the supplementary affidavit. The appellant relied on a previous Tribunal decision and a case law to support their arguments.

The application highlighted that the Tribunal did not consider the appellant's submission that the penalty was imposed under Section 114 of the Act without a finding that the appellant had been guilty of any act leading to the export goods being liable for confiscation under Section 113 of the Act. The impugned order by the Commissioner (Appeals) made observations regarding the abetment in splitting a single consignment into different shipping bills but did not find any willful act by the appellant leading to the confiscation of export goods. Consequently, it was concluded that since the appellant was not found guilty of rendering export goods liable for confiscation under Section 113 of the Act, the penalty imposed under Section 114 of the Act could not be upheld. Therefore, the ROM application was allowed, the penalty was set aside, and the appeal was allowed, necessitating a change in the order of the Tribunal.

In summary, the judgment revolved around the rectification of an error apparent in the final order reducing the penalty imposed under Section 114 of the Customs Act. The appellant challenged the penalty on various grounds, including lack of justification and the competency of the authorities to initiate action. The Tribunal's failure to consider the appellant's submission regarding the penalty imposition without a finding of guilt for confiscation under Section 113 was a crucial point in the judgment, leading to the allowance of the ROM application, setting aside the penalty, and allowing the appeal.