2011 (5) TMI 735 - HC - Customs

Whether Tribunal has committed substantial error of law in extending benefit of reduced penalty under section 114A of the Customs Act, 1962 subject to the respondent depositing 25% of the penalty along with the balance amount of demand and interest within period of 30 days from passing of the impugned order by the Tribunal - Held that - As the language of Section 114A of the Customs Act, as in the case of section 11AC of the Central Excise Act permits option to the assessee, the ratio laid down in M/s. Akash Fashion Prints Private Limited (2009 - TMI - 33022 - GUJARAT HIGH COURT) is also applicable in the present appeal, no question of law arising in this appeal, appeal is dismissed

Summary

Issues:
1. Reduction of penalty under section 114A of the Customs Act, 1962
2. Imposition of redemption fine in absence of seizure of goods
3. Compliance with legal requirements in the Tribunal's order

Reduction of Penalty under Section 114A:
The case involved a company engaged in the manufacture of Twisted Yarn, facing charges of illicit clearance of imported raw materials without following due procedures or paying required duties. The Tribunal confirmed the demand for duty, interest, and a reduced penalty. The main issue raised was whether the Tribunal erred in reducing the penalty to 25% of the duty amount under section 114A. The Tribunal, citing previous judgments, extended the option to deposit 25% of the penalty within 30 days, aligning with the provisions of Section 114A and the Central Excise Act. The Court upheld the Tribunal's decision, emphasizing the applicability of legal provisions and dismissing the appeal.

Imposition of Redemption Fine:
The Tribunal's order was challenged on the grounds of imposing a redemption fine without the seizure of goods, citing a previous case. However, the Court found no error in the Tribunal's decision, as the legal provisions allowed for the imposition of penalties even without seizure under Section 114A, similar to Section 11AC of the Central Excise Act. The Court referenced relevant judgments to support the Tribunal's ruling, ultimately dismissing the appeal due to the lack of legal merit.

Compliance with Legal Requirements:
The appellant contested the Tribunal's order on various grounds, primarily focusing on the reduction of penalty. However, the Court found that the Tribunal's decision was in accordance with the law, as it provided the appellant with the option to deposit a reduced penalty amount within the specified timeframe. Citing previous judgments and legal provisions, the Court concluded that no error existed in the Tribunal's order. Consequently, the appeal was dismissed without costs, highlighting the adherence to legal principles and precedents in the judgment.