2011 (1) TMI 770 - AT - Customs

Penalty u/s 112(a) and 112(b) - Find that unloading of un-manifested cargo without the supervision of the proper officer and delay in filing the manifest by the carrier is purely due to human error and no malafides can be attributed on them - The adjudicating authority has himself held that action of appellant of unloading cargo at Hyderabad was due to human error and no malafides can be attributed - Therefore, the penalty imposed on the appellant under Section 112(a) and 112(b) of the Customs Act, 1962 is excessive - Since the appellant has themselves taken into themselves the unloading of the goods without the supervision of the officers, they should be penalized - But the penalty imposed under Section 112 of the Act is excessive, reduce it to Rs.25,000/- As regards the penalty imposed under Section 30 - Penalty is unwarranted as the appellant has informed the Department his intention that the goods were to be unloaded at Hyderabad as they were not able to unload at Bombay - Thus, the penalty imposed under Section 30 of the Act is set aside.

Summary

Issues:
1. Unloading of cargo without proper supervision and delay in filing manifest.
2. Confiscation of goods under Section 111(f) and 111(g) of the Customs Act, 1962.
3. Imposition of penalties under Section 112(a) and Section 30 of the Customs Act, 1962.

Analysis:
1. The appeal was against an Order-in-original due to the unloading of cargo at Hyderabad airport without proper supervision and delay in filing the Import General Manifest (IGM). The appellant's flight was diverted to Hyderabad from its original route due to technical reasons. The Customs authorities alleged that the goods were liable for confiscation under Section 111(f) of the Customs Act, 1962, as the appellant did not inform them about the non-filing of the IGM. The adjudicating authority confirmed the confiscation but allowed redemption on payment of a fine and imposed penalties under different sections of the Act.

2. The consultant for the appellant argued that the unloading was necessitated by an emergency and technical reasons for diverting the flight. The adjudicating authority acknowledged the human error but still imposed penalties, leading to the appeal. The appellant contended that the goods were not liable for confiscation as they were eventually sent to the destination. The Departmental Representative (DR) argued that the appellant should have informed the Customs officers promptly, and the confiscation and penalties were justified due to the lack of proper documentation.

3. The Member(Judicial) analyzed the situation and found that the unloading was indeed due to human error and emergency circumstances, as acknowledged by the adjudicating authority. Therefore, the penalties imposed were considered excessive. The Member reduced the penalty under Section 112(a) and 112(b) to Rs. 25,000, considering that the appellant should be penalized for unloading without supervision. Additionally, the penalty under Section 30 was deemed unwarranted as the appellant had informed the Department about the unloading situation. Consequently, the penalty under Section 30 was set aside, and the appeal was allowed with modifications to the penalties imposed.