2022 (2) TMI 1416 - AT - Customs

Enhancement of penalty - delayed submission of documents deliberately or with any mala fide intention - HELD THAT - This is a case of delay in furnishing of certain documents. There is no revenue implication. The department has not been able to establish any deliberate delay or any mala fide intention on the part of the appellant. As and when the appellant could gather the requisite documents they were presented before the assessing officers for finalising the provisional assessments. In fact, out of the 35 Bills of Entry involved, 31 could be finalised. The adjudicating authority took a fair decision and imposed a nominal penalty of Rs. 20,000/-. This amount has already been paid by the appellant. The order of the Commissioner (Appeals) does not establish any ground for enhancing the penalty to the maximum of Rs. 50,000/- per Bill of Entry yet to be finalised. In the case of M/S ESSAR OIL LIMITED VERSUS COMMISSIONER OF CUSTOMS 2015 (5) TMI 942 - CESTAT AHMEDABAD , it was held by the Tribunal that when there is some delay in furnishing the documents and there is no revenue implication, penalty is not called for. Appeal allowed.

Summary

Issues:
- Penalty imposed for delay in submission of documents for provisional assessment of imported goods

Analysis:
The case involved the imposition of a penalty on an importer for a delay in submitting required documents for the provisional assessment of imported steam coal. The appellant imported goods through a port and filed 35 Bills of Entry for clearance, but failed to provide essential documents like Commercial Invoice, Bill of Lading, and others. The appellant executed Provisional Duty Bonds as required by the Customs Act, 1962. A Show Cause Notice proposing a penalty was issued due to the delay in document submission. The Adjudicating Authority imposed a penalty of Rs. 20,000 considering it a procedural lapse. The Department appealed for an enhanced penalty, leading to the Commissioner (Appeals) increasing the penalty to Rs. 2,00,000 for 4 Bills of Entry not finalized at that time.

The appellant contended that the penalty enhancement lacked reasoning and that the maximum penalty under the regulations was Rs. 50,000, with no deliberate delay alleged. They argued that the case involved procedural lapses without revenue implications, and penalties should not be imposed for such lapses. The appellant also highlighted that there was no time limit specified for finalizing provisional assessments under the Customs Act, 1962. They sought condonation for the delay in document submission and emphasized that they provided documents as procured, resulting in finalization of 31 out of 35 Bills of Entry.

During the hearing, both sides presented their arguments, with the Revenue supporting the penalty enhancement. The Member (Judicial) noted that the delay was in document submission without revenue implications, and no deliberate delay or mala fide intention was established. The Adjudicating Authority's decision to impose a nominal penalty of Rs. 20,000 was considered fair, as most Bills of Entry were finalized. Referring to precedent, the Member highlighted that penalties are not warranted for delays without revenue impact. Consequently, the Commissioner (Appeals) order was set aside, and the original penalty of Rs. 20,000 was reinstated, disposing of the appeal in favor of the appellant.