2013 (10) TMI 729 - AT - Customs

Confiscation - CD Writers of foreign origin - Held that - In view of the first proviso to Section 128A( 3) of the Customs Act, 1962, the ld. Commissioner (Appeals) ought to have followed the procedure laid down under the said provisions of the Customs Act. Not following the laid-down procedure, in my opinion, the Order of the ld. Commissioner (Appeals) becomes bad in law and accordingly, the same is liable to be set aside. Consequently, the Order of the ld. Commissioner (Appeals) is set aside and the Appeal is remitted to the ld. Commissioner (Appeals) for deciding the issue afresh, after following the procedure laid down under Section 128A(3) of the Customs Act, 1962. Needless to mention that a reasonable opportunity of hearing be granted to the Appellant - Decided in favour of assessee.

Summary

Issues:
1. Jurisdiction of Commissioner (Appeals) under Section 128A of the Customs Act, 1962.

Analysis:
The appeal was filed against an Order-in-Appeal passed by the Commissioner of Customs (Appeals), Kolkata, which involved the recovery and subsequent seizure of 20 cartons containing CD Writers of foreign origin. The Appellant claimed ownership of the goods after they were seized. The Assistant Commissioner of Customs directed the absolute confiscation of the seized goods and imposed a penalty on the Appellant. The Commissioner (Appeals) enhanced the penalty and redemption fine without following the procedure laid down under Section 128A(3) of the Customs Act, 1962.

The Appellant argued that the Order-in-Appeal was without jurisdiction as it did not adhere to the procedure under Section 128A of the Customs Act, specifically mentioning the lack of notice before enhancing the penalty or fine. The Appellant contended that the Order-in-Appeal was illegal and should be set aside.

The Revenue supported the findings of the Commissioner (Appeals) during the proceedings.

Upon hearing both sides and examining the records, it was found that the Commissioner (Appeals) had indeed increased the penalty and redemption fine without following the prescribed procedure under Section 128A(3) of the Customs Act, 1962. The relevant provisos to the section were cited, emphasizing the requirement for providing the appellant with a reasonable opportunity to show cause against the proposed order of enhancement. Consequently, the Order of the Commissioner (Appeals) was deemed unlawful and set aside. The matter was remitted back to the Commissioner (Appeals) for a fresh decision after following the proper procedure and ensuring a fair hearing for the Appellant. The decision was made in favor of the Appellant by way of remand.