2014 (9) TMI 101 - AT - Customs

Waiver of predeposit of penalty - Section 112(b) of the Customs Act, 1962 - Held that - Bank Guarantees executed by the Applicant Nos.(1) & (4) for ₹ 8.00 lakh and ₹ 3.00 lakh respectively, would fairly cover the penalties imposed on them. Regarding the role of the Applicant No.(2), prima facie, I am not convinced with the argument of the ld. Advocate for the Applicants, that the said Applicant might not be involved at all in any manner, in the activity of bringing the betel nuts in question, at this stage. Similarly, the Applicant No.(3) had also admitted of bringing the betel nuts of third country origin, illicitly, into India. However, prima facie, I find that the Applicant No.(5) had been penalized without making a discreet enquiry by way of recording his statement of his involvement in the act of smuggling. In view of the above observations, I am of the opinion that the Applicants, namely, Md. Aftab Ahmed, Applicant No.(2) and Shri Rajesh Gupta,Applicant No.(3) could not able to make out a prima-facie case for total waiver of predeposit of the penalty imposed on each of them. - stay granted partly.

Summary

Issues:
Applications seeking waiver of predeposit of penalty under Section 112(b) of the Customs Act, 1962 for five Applicants.

Analysis:
- The Customs Authorities seized betel nuts suspected to be of foreign origin, loaded on a truck accompanied by a TRAVERA Vehicle. The case lacked direct evidence to establish the betel nuts were illegally imported. Bank Guarantees were executed by the claimant of the betel nuts and the owner of the TRAVERA Vehicle, covering the penalties imposed on them.
- The husband of the claimant was implicated based on the statement of the occupant of the TRAVERA Vehicle. However, there was no corroborating evidence against him. The driver of the TRAVERA Vehicle was penalized without his statement being recorded.
- The Revenue argued that circumstances indicated smuggling of goods from a third country, supported by oral evidence from the occupant of the TRAVERA Vehicle. However, no statement was taken from the driver of the TRAVERA Vehicle.
- The Tribunal found the Bank Guarantees sufficient for two Applicants but not for the husband and the occupant of the TRAVERA Vehicle. The husband's involvement was not convincingly disproved, while the occupant admitted to smuggling. The driver was penalized without a proper inquiry.
- The Tribunal directed two Applicants to deposit 10% of the penalty within eight weeks, with the balance waived during the appeal. For the other three Applicants, the predeposit of penalties was waived and recovery stayed during the appeal.
- Bank Guarantees for two Applicants were to be kept alive during the appeal, with the option for the Revenue to address any discrepancies. All Stay Petitions were disposed of accordingly.