2014 (2) TMI 345 - AT - Customs

Amendment to Bill of entry - Declaration of one painting (instead of two) in the Bill of Entry - Confiscation and penalty - Held that - First check order was passed on 18.8.2006 whereas request of amendment was made on 17.8.2006. On the other hand, it is contention of Revenue that amendment application was moved only after First check was ordered by the appraising group, it is also noticed that consignor and consignee are same, value is same, date of invoices is same and both invoices are not numbered. It is not clear what stopped the consignor to issue a single invoice for both paintings with different description of Bindu and Rajasthan. Under such circumstances, if amendment application is filed after first check is ordered by the appraising group, denial of amendment by the proper officer cannot be faulted with. Under Section 149 of the Customs Act the proper officer may, in his discretion, authorise any document, after it has been presented in the Customs House to be amended . The proper officer is given discretion to allow the amendment or not. - Additional Commissioner has applied his discretion in not allowing the amendment and consequently confiscating the goods and imposing the penalty on the appellant. - No infirmity in denying the amendment of Bill of Entry - Decided in favor of revenue.

Summary

Issues Involved:
1. Whether the amendment to the Bill of Entry was justified.
2. Whether the misdeclaration was intentional or unintentional.
3. Whether the confiscation of the painting and imposition of penalty were appropriate.
4. Whether the penalty imposed should be reduced.

Issue-Wise Detailed Analysis:

1. Justification of Amendment to the Bill of Entry:
The respondents imported two paintings but declared only one in the Bill of Entry dated 12.8.2006. They later requested an amendment to include the second painting, arguing it was an oversight. The Commissioner (Appeals) allowed the amendment under Section 149 of the Customs Act, 1962, stating that denying such amendments would render Section 149 irrelevant. The Tribunal found that the request for amendment was made before the examination of the goods and held that the oversight was unintentional, thus justifying the amendment.

2. Intentional or Unintentional Misdeclaration:
The Tribunal examined whether the omission of the second painting in the Bill of Entry was intentional. The respondents argued that the mistake occurred because both invoices were dated the same and valued at Euro 20,000 each. The Tribunal found that the invoices looked similar except for the painting titles, and the payment for both paintings had been made before filing the Bill of Entry. Therefore, it concluded that the misdeclaration was unintentional and a bona fide error.

3. Confiscation and Penalty Imposition:
The original adjudicating authority confiscated the painting and imposed a penalty, which the Commissioner (Appeals) set aside. The Tribunal, in its majority decision, found that the amendment request was made before the examination of goods and that the oversight was unintentional. However, one member dissented, arguing that the misdeclaration was deliberate and aimed at evading duty. This member cited precedents where mens rea was not required for confiscation and penalties under the Customs Act. Ultimately, the majority upheld the view that the confiscation was not justified for an unintentional mistake.

4. Reduction of Penalty:
The Tribunal was divided on whether the penalty should be reduced. The majority opinion held that the penalty should be reduced from Rs. 2 lakh to Rs. 1 lakh, considering the unintentional nature of the mistake. The dissenting member argued that the penalty should be maintained or only slightly reduced due to the deliberate nature of the misdeclaration. The final decision, based on the majority, reduced the penalty to Rs. 1 lakh.

Final Judgment:
The Tribunal, by a majority decision, set aside the order of the Commissioner (Appeals) and allowed the Revenue's appeal. However, the penalty imposed on the respondent was reduced from Rs. 2 lakh to Rs. 1 lakh. The majority found that the amendment to the Bill of Entry was justified due to the unintentional nature of the oversight, but the dissenting opinion highlighted the deliberate misdeclaration and the need for penal action. The final order reflected a compromise, acknowledging the mistake while still imposing a reduced penalty.