2015 (2) TMI 1083 - AT - Customs

Penalty u/s 112(a) on courier agency - Failure to inform that the goods are second hand - Confiscation of goods - Held that - Appellant is absent, inspite of several opportunities given, and accordingly the appeal is being disposed of after hearing the Ld. AR and perusing the records. This Tribunal finds no case of mis-declaration by the courier, as it is evident on the face of the document the invoice and courier shipment airway bill that the import in question is made for repairs and thereafter for sending back. These documents are annexed to the bill of entry at the time of clearance. As such the authorities below are in error in holding that a case of mis-declaration and suppression is made out against the appellant courier agency. Further SO2 Analyser is a capital goods under para 9.12 of FTP, which includes instrument for testing, research, quality on pollution control - Courier agency is entitled to refund of pre-deposit made during the investigation or pending of proceedings. - Decided in favour of appellant.

Issues:
1. Allegation of non-declaration of second-hand goods by the courier.
2. Imposition of penalty under Section 112(a) of the Customs Act.
3. Interpretation of the definition of capital goods.
4. Obligation of the courier regarding due diligence and declaration of goods.
5. Applicability of IEC number for imports.

Analysis:
1. The appellant, a courier agency, appealed against an Order-in-Appeal by the Commissioner of Customs regarding the non-declaration of second-hand goods imported for repairs. The appellant argued that the goods were not restricted under FTP 2004-09 and hence not liable for confiscation. They contended that as a courier service, they were not responsible for penalties. The Commissioner dismissed the appeal, stating that the goods were second-hand and liable for confiscation under para 2.17 of FTP. The Commissioner also noted the absence of an IEC number, mandating its requirement for imports.

2. The Commissioner imposed a penalty under Section 112(a) of the Customs Act, citing the courier's failure to declare the goods as old/used/second-hand and the absence of an IEC number. The Commissioner held that the courier had not exercised due diligence, violating Courier Import and Export Regulations 1998. The appellant challenged this penalty before the Tribunal.

3. The Tribunal found no mis-declaration by the courier, as evidenced by the documents showing the import was for repairs and subsequent re-export. The Tribunal disagreed with the lower authorities, stating that the courier agency did not commit mis-declaration or suppression. The Tribunal classified the SO2 Analyser as a capital good under FTP, including instruments for testing and research, thereby allowing the appeal and ordering a refund of the pre-deposit made during the proceedings.

4. The Tribunal's decision emphasized the importance of proper documentation and the lack of evidence supporting mis-declaration by the courier agency. The judgment clarified the classification of the imported goods and highlighted the courier's entitlement to a refund based on the findings of the case.

5. In conclusion, the Tribunal's ruling favored the appellant courier agency, overturning the penalty imposed by the Commissioner and emphasizing the correct interpretation of capital goods and due diligence obligations for couriers in import processes.

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