2015 (4) TMI 310 - AT - Customs

Penalty u/s 112 - Misdeclaration of goods - held that - The provisions of Section 127A to 127N of the Customs Act, 1962 deal with the Settlement of cases. It is clear from Section 127B that an importer may make an application in relation to a case disclosing the full and true duty liability before the proper officer. In the present case, we find that the Additional Commissioner has not challenged the deposit of duty made by Shri Sunil Lulla. Therefore he has treated Shri Sunil Lulla as the importer. In other words he has consented that Shri Sunil Lulla is entitled to file an application before the Settlement Commission, as an importer. - The provisions of Section 127A(b) define a case', the provisions of Section 127F give exclusive jurisdiction to the Settlement Commission in relation to the case and Section 127J which provides that every order passed under Section 127C shall be conclusive- all lead to a reasonable conclusion that once a case has been decided in respect of the importer or the applicant by the Settlement commission, it is not open to Revenue to proceed against other co-noticees. - The provisions of Kar Vivad Samadhan Scheme and the provisions of Settlement are similar and therefore the principle laid down in the case of Onkar S. Kanwar (2002 (9) TMI 101 - SUPREME Court) would apply in the present case. - Decided in favour of assessee.

Summary

Issues:
1. Imposition of penalty under Section 112(a) of the Customs Act, 1962 on the appellant.
2. Applicability of Settlement Commission's decision on co-noticees.
3. Interpretation of provisions of the Customs Act regarding settlement of cases.
4. Liability of co-noticees in cases of separate causes of action.

Analysis:
1. The appellant's appeal challenged an Order-in-Appeal dismissing their appeal against an Order-in-Original imposing a penalty of Rs. 3,00,000 under Section 112(a) of the Customs Act, 1962. The case involved the clearance of an imported vehicle by mis-declaring the year of manufacture, leading to allegations of violation of import conditions and duty evasion. While the importer had settled the case with the Settlement Commission, the appellant faced penalties.

2. The appellant argued that once a case is settled with the Settlement Commission by the importer, co-noticees should be immune from further action. Citing various Tribunal decisions, the appellant contended that once the main notice's case is resolved, proceedings against co-noticees should cease. The Settlement Commission's decision for the importer should extend immunity to co-noticees, as per legal precedents.

3. The Tribunal analyzed the provisions of Sections 127A to 127N of the Customs Act, 1962 regarding the settlement of cases. It was noted that the Additional Commissioner had not challenged the duty deposit made by the importer, treating him as the importer entitled to settle with the Commission. The Tribunal found that once a case is decided for the importer by the Settlement Commission, the Revenue cannot proceed against co-noticees, aligning with Tribunal judgments and legal interpretations.

4. The Tribunal distinguished the case at hand from the judgment cited by the Revenue, emphasizing that the sale of the car involved an indivisible act between the importer and the co-noticee, making the causes of action singular. Referring to legal principles and precedents, the Tribunal concluded that the Settlement Commission's decision for the importer should extend to co-noticees in cases of singular causes of action. Consequently, the impugned order imposing penalties on the appellant was set aside, allowing the appeal with consequential relief.

Conclusion:
The Tribunal's detailed analysis focused on the legal principles surrounding the Settlement Commission's decisions, co-noticees' liabilities, and interpretations of the Customs Act provisions. By aligning with legal precedents and distinguishing the case's circumstances, the Tribunal overturned the penalty imposed on the appellant, emphasizing the immunity co-noticees should receive post-settlement by the importer with the Settlement Commission.