2015 (2) TMI 129 - AT - Customs

Wavier of predeposit of penalty - Confiscation of red sander logs - Held that - M/s. Sheth Commercial Company in whose name the impugned Shipping Bills were filed, had denied to have exported the impugned consignment. We find from the observations of the ld. Commissioner that none of the Applicants verified the credential of the documents and the identity of the actual Exporter. He has also recorded that Shri Laha and Shri Sambhu Das were present during stuffing of the containers. We find that the evidences produced by both sides in their support, requires appreciation of evidences which can be examined in detail, at the time of final disposal of the Appeals. However, from the chain of events narrated by the ld. Commissioner, it is evident that the complicity of the Applicants in the present case of exporting red sander wood, a prohibited item, cannot be ruled out. We find that action or omission on the part of the above-mentioned Applicants has resulted into the export of red sander log, which is a prohibited item, and therefore, the export consignments are liable for confiscation and penalty is imposable on the Applicants. Prima facie, the Applicants are not able to make out a case for full waiver of the penalty. Accordingly, we direct each of the Applicants, to deposit 10% of penalty imposed, within a period of eight weeks of the communication of the Order. On deposit of the said amount, predeposit of the remaining amount of penalty imposed on each of the Applicants, stands waived and its recovery stayed, during pendency of the Appeals - Partial stay granted.

Summary

Issues:
1. Predeposit of penalty imposed by the Commissioner on multiple applicants.

Analysis:
1. The case involved applicants who were implicated in the illicit export of red sander logs, a prohibited item, under the guise of Jute Hessian Cloth. The goods were seized under the Customs Act, 1962, and a Show Cause Notice was issued for penalty imposition and confiscation of the goods.

2. The Commissioner found the charges against the applicants proved, indicating their involvement in the export of prohibited goods. The applicants were accused of abetting smuggling and were held accountable for contravening EXIM Policy and Customs Act provisions, leading to the confiscation of goods and imposition of penalties.

3. The legal representatives of the applicants presented various arguments. They claimed lack of specific allegations against them, financial hardships, denial of cross-examination opportunities, and disputed their direct involvement in the smuggling activities. They argued that they acted in good faith or were not directly linked to the smuggling operations.

4. The Revenue's representative supported the Commissioner's findings, asserting that the applicants played shadowy roles in the illicit export, aiding the smuggling activities despite lacking a legitimate role in the export transactions.

5. The Tribunal acknowledged the export violations and the complicity of the applicants based on the evidence presented. While the applicants denied direct involvement, the Tribunal noted their failure to verify the credentials of the exporter and the documents. The Tribunal directed the applicants to deposit 10% of the penalty imposed within eight weeks to waive the remaining penalty amount, pending the appeal's resolution.

6. The Tribunal's decision aimed to balance the penalty imposition with the applicants' financial circumstances, providing a partial waiver upon the initial deposit. Failure to comply with the deposit directive would lead to automatic dismissal of the appeals without further notice.

This detailed analysis covers the issues and the Tribunal's decision regarding the predeposit of penalties imposed on the applicants involved in the illicit export of red sander logs.