2012 (3) TMI 407 - HC - Customs

Summary

Issues Involved:
The judgment deals with the following substantial questions of law:
1. Liability for penalty under Section 112(a) of the Customs Act, 1962.
2. Liability for penalty in absence of ownership claim over exported rough diamonds and non-filing of bills of entry under Section 46 of the Customs Act, 1962.
3. Liability for confiscation of rough diamonds under Section 111(d) of the Customs Act despite being accompanied by Kimberly Process Certificate.
4. Liability for penalty concerning the issuance of Kimberly Process Certificate by the exporter.
5. Liability for confiscation of rough diamonds in light of Circular No. 53/2003 issued by the Central Board of Excise and Customs.
6. Compliance with previous decisions of the Tribunal.

Liability for Penalty under Section 112(a):
The Tribunal was questioned for holding the appellant liable for penalty under Section 112(a) of the Customs Act, 1962. The appellant argued against this decision, raising concerns about the legal errors committed by the Tribunal.

Ownership Claim and Non-filing of Bills of Entry:
Another issue raised was the liability for penalty despite the appellant never claiming ownership over the rough diamonds exported and not filing bills of entry under Section 46 of the Customs Act, 1962. The Tribunal's decision was challenged based on these grounds.

Confiscation of Rough Diamonds with Kimberly Process Certificate:
The Tribunal's decision to hold the consignments of rough diamonds liable for confiscation under Section 111(d) of the Customs Act was disputed, especially when accompanied by Kimberly Process Certificate and confirmed by the exporter. The appellant questioned the legal basis for this decision.

Role in Kimberly Process Certificate Issuance:
The appellant contested the liability for penalty concerning the Kimberly Process Certificate issued by the exporter, emphasizing the lack of control or role in the certificate's issuance process. This issue raised questions about the Tribunal's understanding of the circumstances.

Compliance with Circular No. 53/2003:
The Tribunal's decision on the liability for confiscation of rough diamonds in light of Circular No. 53/2003 issued by the Central Board of Excise and Customs was challenged. The appellant sought clarity on the application of the circular and its relevance to the case at hand.

Precedent and Tribunal Decision Compliance:
Lastly, the Tribunal's failure to follow its own decision in a previous case and the confirmation by the Honorable Supreme Court was highlighted. The appellant argued for consistency in decisions and urged the Tribunal to adhere to established precedents.

Civil Application and Interim Order:
In a separate order on civil applications, the Court granted an interim order restraining the respondent authority from taking adverse action or recovery proceedings for the penalty subject to the appeals. The appellant was given the liberty to apply for an extension of the interim order, signaling a temporary relief granted by the Court.