2015 (4) TMI 599 - AT - Customs

Imposition of redemption fine - Whether redemption fine and penalties are impossible when quantity of 2 Ethyl Hixyl Acrylate, imported by appellant under Bill of Entry No. 245685 dated 20.06.2013, was received in excess of the quantity specified in the documents, without the knowledge of the appellant - Held that - Adjudicating authority demanded duty/ interest and imposed redemption fine of ₹ 1,15,000/- upon the appellant under Section 125(l) of the Customs Act, 1962. He also imposed a penalty of ₹ 35,000/- upon the appellant vide Section 112(a) of the Customs Act, 1962. Under the impugned OIA, first appellate authority set-aside the levy of duty but upheld imposition of redemption fine and penalty but reduced the same to ₹ 60,000/- and ₹ 15,000/- respectively. - Following decision of Commissioner of Customs (Export), Chennai vs. Bansal Industries 2006 (9) TMI 58 - HIGH COURT, MADRAS - In view of the settled proposition of law, redemption fine and penalty are imposable. No other contrary case law of higher judicial forum has been brought to the notice of the Bench by the appellant. Further, first appellate authority has already extended substantial benefit to the appellant by setting aside the duty liability and by reducing the redemption fine and penalty - Decided against Assessee.

Summary

Issues involved: Whether redemption fine and penalties are imposable when imported quantity exceeds the specified amount without the knowledge of the importer.

Analysis:

Issue 1: Redemption fine and penalties imposition
- The appellant contended that they were unaware of the excess quantity received beyond what was specified in the import documents. Citing case laws like Sham Lal & Company vs. Commissioner of Customs, it was argued that no redemption fine or penalty should be imposed.
- The respondent, relying on the case of Commissioner of Customs vs. Bansal Industries, argued that mens rea is not necessary for confiscation and penalty imposition under the Customs Act, 1962.
- The adjudicating authority initially demanded duty, interest, and imposed a redemption fine and penalty. The first appellate authority reduced the fine and penalty but upheld their imposition.
- Referring to the Madras High Court case, it was emphasized that mens rea is not essential for contravention of civil law provisions. The court highlighted that the intention to evade duty is not a prerequisite for imposing penalties.
- The tribunal found that the appellant did not willfully misdeclare the goods to evade duty. However, the focus should be on the breach of civil obligation rather than intent to evade duty.
- Based on the legal principles outlined, the tribunal concluded that redemption fine and penalty are imposable. No contradictory case law was presented, and the appellant had already received substantial benefit from the reduction in fines and penalties.
- The appeal was ultimately rejected, affirming the imposition of redemption fine and penalty as per the Customs Act, 1962.

This detailed analysis covers the arguments presented by both parties, the legal precedents cited, the tribunal's interpretation of the law, and the final decision regarding the imposition of redemption fine and penalties in the case of excess imported quantity without the importer's knowledge.