2016 (5) TMI 186 - AT - Customs

Imposition of penalty on Courier - Section 117 of the Customs Act, 1962 - Incorrectly advising their client and for non-compliance of the provisions of the Act which was his duty to do so - Held that - both the lower authorities erred in imposing penalty on the appellant under Section 117 of the Customs Act, 1962 for more than one reason. Firstly, the appellant is a courier and has filed courier bill of entry as per the declaration and authorization given to him by the importer. Appellant had filed courier bill of entry based upon the proforma invoice provided to him by the importer and in my view, has not contravened any of the provisions of the Customs Act, 1962 to attract penalty. It was his duty to inform the importer to file the bill of entry and discharge duty liability, in response to which he was authorised to file the bill of entry with the value as being shown in the proforma invoice and cannot be considered as a dereliction of duty. Secondly, provisions of Section 117 gets attracted only to a person who has contravened the provisions of the Act or abets any such contravention or fails to comply with any provisions of the Act which is his duty to comply and where there was no express penalty provided is not at all present in this case. Therefore, if the Revenue had strong case against the appellant they could have issued a show cause notice by invoking the various other provisions of the Act for imposition of penalties. Having not done so, the penalty under the provisions of Section 117 cannot be invoked against the appellant. - Decided in favour of appellant with consequential relief

Summary

Issues:
Penalty under Section 117 of the Customs Act, 1962 for incorrect advising and non-compliance of provisions.

Analysis:
The appeal was filed against an Order-in-Appeal passed by the Commissioner of Customs (Appeals), Mumbai-III. Despite multiple adjournments due to the appellant's non-representation, the appeal was taken up for disposal. The issue revolved around the penalty imposed on the appellant under Section 117 of the Customs Act, 1962. The appellant, a courier, had filed a courier bill of entry for goods imported by a company, where undervaluation occurred. The Departmental Representative defended the penalty, stating that the appellant did not correctly advise the client and did not comply with the Act. However, upon review, it was found that the penalty was unjustified.

The Tribunal found errors in the imposition of the penalty by the lower authorities. Firstly, the appellant, acting as a courier, filed the bill of entry based on the proforma invoice provided by the importer, as per the authorization given. The appellant's actions did not contravene any Customs Act provisions. It was deemed the appellant's duty to file the bill of entry based on the proforma invoice, and this did not amount to a breach. Secondly, Section 117 of the Act applies to those who contravene or fail to comply with provisions, which was not the case here. The Tribunal highlighted that if the Revenue had a strong case, they should have issued a show cause notice under different provisions for penalties. Since this was not done, invoking Section 117 for penalty was deemed inappropriate.

Consequently, the impugned order against the appellant was set aside, and the appeal was allowed with any consequential relief as per the law. The Tribunal's decision was based on the lack of contravention by the appellant and the incorrect application of Section 117 for imposing the penalty.