2013 (10) TMI 1255 - AT - Customs

Mis-declaration of Goods - Duty Drawback personal penalty on directors - Waiver of Penalty Held that - The Adjudicating Authority has not imposed any penalty on the directors however the commissioner (appeal) Imposed penalty on all the three directors - He only reconsidered imposition penalty on all the three directors - Order refers to directors and not partners - There was wide difference of 47.5 kg out of total decleared quantity of 150 kg clearly indicating their was clear intent to avail higher drawback - Considering overall facts of the case and gravity of availing higher drawback claim, this is a fit case there is no leniency is required to be shown as prima-facie appellants are not able to make any case of waiver of penalty - all the three stay applications for waiver of penalty on directors are rejected - stay rejected.

Summary

Issues:
Penalty imposition on partners of a partnership firm for misdeclaration of export goods.

Analysis:
The case involved a penalty imposed on a partnership firm, M/s Poornima Handicrafts, for misdeclaring export goods as old and used clothes when they were actually 100% Cotton Printed Plain Woven Vintage-Throw. The penalty was also proposed on the partners, Shri Ganesh Kumar Rana, Smt. Sita Devi Ranal, and Smt. Revu Rana. The counsel for the appellants argued that if a penalty was imposed on the partnership firm, there should not be a penalty on the partners, citing relevant case laws.

Upon examination, it was noted that the Adjudicating Authority did not impose any penalty on the directors, but the Commissioner (Appeal) imposed a penalty on all three directors. The judge clarified that the judgments from Mumbai High Court and Gujarat High Court cited by the appellants were not relevant as they referred to partners, not directors. The discrepancy in the declared quantity of goods indicated an intent to avail higher drawback.

Considering the gravity of the case and the intent to avail higher drawback claim, the judge found no grounds for leniency and rejected all three stay applications for waiving the penalty on the directors. A deadline of six weeks was given for the penalty amount to be deposited, with compliance to be noted by a specified date.

In conclusion, the judgment upheld the penalty imposition on the partners of the partnership firm for misdeclaration of export goods, emphasizing the seriousness of the offense and the lack of grounds for leniency in this case.