2020 (1) TMI 1334 - AT - Customs

Recovery of Differential Duty - import of myristic acid - importer accepted the error in having sought availment of the wrong entry in the exemption notification and accepted the liability for differential duty - HELD THAT - The eligibility of the impugned goods for concessional rate under N/N. 46/2011-Cus dated 1st June 2011 is not in dispute. The specific entry within the said notification appears to have been erroneously claimed and, upon it being pointed out, the importer accepted the error in the bill of entry. That this error is, as claimed by the appellant, inadvertent would appear to be tenable as the possibility of confusion between the numbers corresponding to the claimed entry and the eligible entry cannot be ruled out. Furthermore, as pleaded by Learned Counsel, the declaration of tariff item, as well as description of the goods, would also make it apparent that there has been no misdeclaration within the meaning of section 111 of Customs Act, 1962 and that such a patent error cannot be seen as an attempt at misleading the system - the invoking of section 111 and section 112 of Customs Act, 1962 is not warranted. Appeal allowed.

Summary

Issues:
1. Upholding of differential duty on import of 'myristic acid'
2. Confiscation of goods under section 111(m) of Customs Act, 1962
3. Imposition of penalty under section 112 of Customs Act, 1962

Analysis:
1. The appeal challenged the order-in-appeal upholding the recovery of differential duty on the import of 'myristic acid' in three bills of entry. The goods were sought to be classified under a specific tariff item with a declared value. The appellant accepted the error in seeking the wrong entry in the exemption notification, leading to a differential duty liability of ?99,958. The original authority confiscated the goods under section 111(m) and imposed a penalty under section 112 of the Customs Act, 1962, which was challenged in the appeal.

2. The importer acknowledged the error and accepted the liability for the differential duty. Re-assessment was conducted by the Additional Commissioner of Customs after the appellant waived the right to a show cause notice and a personal hearing. The original authority invoked section 111 for confiscation and imposed a penalty, which was challenged before the appellate authority. The appellant contended that the error was inadvertent and not intentional misrepresentation, thus challenging the confiscation and penalty.

3. The appellate tribunal noted that the eligibility of the goods for a concessional rate under the notification was not disputed. The importer accepted the error in claiming the wrong entry in the notification, attributing it to inadvertence. The tribunal found the possibility of confusion between the claimed and eligible entries plausible. The tribunal agreed with the appellant that there was no misdeclaration or attempt to mislead the system. Consequently, the tribunal allowed the appeal, setting aside the confiscation and penalty imposed under sections 111 and 112 of the Customs Act, 1962.