2019 (7) TMI 1657 - AT - Customs

Smuggling - Confiscation of goods - 200 Units of Portable Power Generator - import without a valid Certificate of type approval as prescribed under GSR 535 E dated 07.08.2013 and for being not declared in BL and IGM - HELD THAT - The present importer M/s.Al Burhan International, Kolkata-700001 imported a consignment of 440 kerosene water pumps. They were yet to file a bill of entry to clear the consignment. During the same time, SIB was investigating into imports of portable power generators in garb of kerosene water pumps. They had registered a few cases and had issued an alert circular. In the instant case, the importer claims that after receipt of goods they received the import documents wherein they found that the consignment consists of 200 portable power generators, which they had not ordered. They approached the Import Noting Section and requested for amendment in the IGM to include 200 pcs. Of portable power generators. Sensing that the importer might have fraudulent intention, the Import Noting Section did not permit amendment to the IGM - the redemption fine and penalty on Reexport of goods is not imposable under Sections 125 and 112 of Customs Act, 1962 when supplier confessed mistake and agreed to bear expenses for export due to wrong shipment by foreign supplier and no mala fide on part of respondent as has been held in the case of REGAL IMPEX VERSUS C.C., ICD, TKD, NEW DELHI 2015 (10) TMI 2259 - CESTAT NEW DELHI ). The Tribunal in this case has held that when goods found other than what was ordered and on persuasion of the importers the overseas supplier admitted that goods are wrongly shipped, the charges of mis-declaration on the importers is not sustainable - Hence, applying the ratio of the above judgement when the respondent is not claiming the goods due to wrong supply is not liable to penalty under any circumstance and accordingly, the order imposing penalty on the respondent is liable to be set aside. The departmental appeal has been preferred on the grounds that goods were not confiscated under Section 111(d) and 111(f) and 119 of Customs Act, 1962. Also, against the Order-in-Original, the respondent had also preferred an appeal, which was allowed vide Order-in-Appeal No.Kol/Cus/Port/AA/733/2017 dated 03.07.2017, setting aside the order of the adjudicating authority. Hence, the appeal filed by the department is not maintainable and liable to be rejected. Appeal dismissed - decided against Revenue.

Summary

Issues:
Delay in filing the appeal before the Tribunal, Wrong supply of goods, Confiscation of goods under Customs Act, 1962, Imposition of penalty on the importer, Amendment of Import General Manifest (IGM).

Analysis:
1. Delay in filing the appeal: The appellant department filed a Miscellaneous Application for condonation of delay in filing the appeal before the Tribunal. The delay was condoned based on sufficient reasons provided by the appellant department, and the appeal was allowed to proceed for hearing.

2. Wrong supply of goods: The case involved an order for 440 Kerosene Water Pump Sets, but the importer received 200 Portable Power Generators and 240 Kerosene Water Pump Sets instead. The overseas supplier admitted the mistake and resold the goods to another party. The importer disowned the goods and sought an amendment in the Import General Manifest (IGM).

3. Confiscation of goods under Customs Act, 1962: The investigation revealed discrepancies in the imported goods, leading to a proposal for confiscation under Section 111(d) of the Customs Act, 1962. The importer denied the allegations and claimed that the issue was a simple case of amendment of IGM, not mis-declaration.

4. Imposition of penalty on the importer: The Adjudicating Authority imposed a penalty on the importer under Section 30(3) of the Customs Act, 1962, which was not proposed in the show cause notice. The appellant department appealed against this order, questioning the authority's decision regarding confiscation and penalty imposition.

5. Amendment of Import General Manifest (IGM): The importer requested an amendment in the IGM to reflect the correct details of the imported goods. However, the Import Noting Section did not permit the amendment, suspecting fraudulent intentions on the part of the importer.

6. Decision and Analysis: The Commissioner(Appeals) set aside the original order and allowed the appeal filed by the importer. The Tribunal upheld this decision, citing precedents where penalties were not imposed when the goods were not claimed due to wrong supply. The Tribunal also highlighted the importer's lack of involvement in the fraud and the foreign supplier's right to resell the goods to another customer.

In conclusion, the appeal filed by the department was dismissed, and the impugned order was sustained based on the findings related to the wrong supply of goods, confiscation, penalty imposition, and the amendment of the IGM. The judgment emphasized the importer's non-liability for penalties in cases of wrong supply and the foreign supplier's rights in such situations.