2013 (11) TMI 594 - AT - Customs

Penalty under Section 114 - export of rice - Held that - separate penalty on partner when also imposed on partnership firm - no such corresponding provision in relation to imposition of penalties under the Act - Tribunal was justified in holding that no separate penalties were warranted on the partners in addition to the penalty on the partnership firm no separate penalty - Decided in favour of assessee.

Summary

Issues involved:
Appeals against penalty imposition under Section 114 of the Customs Act on a partnership firm, a Customs House Agent (CHA), and employees of the CHA for attempting to export non-basmati rice as basmati rice.

Analysis:
1. Penalty on Partnership Firm:
- The partnership firm, M/s. Haryana Trading Co., attempted to export non-basmati rice as basmati rice.
- The firm paid the penalty imposed, leading to a question of imposing a separate penalty on the partner, Shri Solly Perumal.
- Citing a judgment by the Hon'ble High Court of Gujarat, it was held that no additional penalty can be levied on a partner if the firm has already been penalized.
- Consequently, the penalty on Shri Solly Perumal was set aside.

2. Penalties on CHA and Employees:
- The CHA, M/s. Trinity Shipping, and its employees were penalized for their involvement in the attempted export.
- The argument presented was that the CHA and employees were not aware of the misrepresentation of the rice quality.
- Drawing on a previous case involving a similar issue, it was noted that there was no evidence proving the awareness of the CHA or its employees regarding the misrepresentation.
- The Tribunal found that the penalties on the CHA firm and its employees were based on presumption and lacked legal basis.
- As there was no evidence implicating the CHA and its employees in the violation, the penalties were deemed unwarranted and set aside.

3. Conclusion:
- The Tribunal disposed of the appeals by setting aside the penalties imposed on the partnership firm, the CHA, and its employees.
- The judgment emphasized the necessity of concrete evidence to support penalty imposition under the Customs Act, ensuring fair treatment based on legal provisions.

This detailed analysis of the judgment highlights the legal considerations and interpretations that led to the decision to set aside the penalties imposed on the parties involved in the attempted export of non-basmati rice as basmati rice.