2016 (5) TMI 833 - AT - Customs

Whether the Commissioner (Appeals) was to decide only personal penalty or the issue of confiscation, the penalty and redemption fine related thereto - Held that - the Hon;ble Member has mentioned that he is unable to go into merit of the case and the matter was remanded to the Commissioner (Appeals) to reconsider the issue and pass a fresh order on merit. It was observed that the appeal before the Commissioner (Appeals) as well as before this Tribunal was undisputedly, not only on the issue of penalty but also the issue of confiscation and redemption fine was challenged. I also tried to find out in the proceeding that at any stage where the appellant conceded and gave up the issue of confiscation of goods and redemption fine, but I found that appellant has not conceded on the issue of confiscation and penalty, therefore while remanding the matter by this Tribunal to the Commissioner (Appeals), all the issues were kept open to reconsider by the Commissioner (Appeals). Commissioner (Appeals) decided the issue of personal penalty in isolation without deciding the confiscation and redemption fine on merit. Therefore, the impugned order deserves to be set aside and matter to be remanded to the Commissioner (Appeals) to decide all the issues involved in the appeal filed by the appellant. As regard submission of the appellant that since goods have been sold by the department and the same is not available for redemption, the redemption fine penalty will not sustain and the appellant is entitle for refund the value of the goods in terms of the Hon ble Supreme Court and Karnataka High Court judgments. It is found that since the Commissioner (Appeals) has yet to decide the merit of entire case, it will be pre-mature to pass any order on this aspect. However, the Ld. Commissioner (Appeals) while deciding the case on merit may consider this issue. Appeal allowed by way of remand

Summary

Issues involved:
1. Whether the Commissioner (Appeals) was to decide only personal penalty or the issue of confiscation, the penalty, and redemption fine related thereto.

Detailed Analysis:
The case involved an appeal against an Order-in-Appeal passed by the Commissioner of Central Excise, Mumbai, where the appeal filed by the appellant was rejected. The dispute arose from the detention of fabrics belonging to an importer and director of two companies, which were found to not match the imported goods under the Bills of Entry. The goods were confiscated under the Customs Act, 1962, and a penalty was imposed. The appellant challenged this decision before the Commissioner (Appeals), who rejected the appeal as time-barred. Subsequently, the matter was remanded by the Tribunal to the Commissioner for disposal on merit.

Upon review, the Commissioner (Appeals) decided only on the personal penalty issue, neglecting to address the matters of confiscation and redemption fine. The appellant argued that all issues, including confiscation and redemption fine, were raised before both the Commissioner (Appeals) and the Tribunal. The appellant contended that the test report of the textile committee was crucial evidence, which was not considered by the lower authorities. The appellant also raised the issue that without the confiscated goods being returned, the redemption fine and penalty should not be sustained, citing relevant legal precedents.

The Revenue, represented by the Assistant Commissioner, supported the decision of the Commissioner (Appeals) based on the Tribunal's observation that only the personal penalty issue was involved. However, the Tribunal found that all issues, not just the penalty, were challenged in the appeal.

After considering the arguments from both sides, the Tribunal concluded that the Commissioner (Appeals) erred in deciding only on the personal penalty and failing to address the issues of confiscation and redemption fine. The Tribunal set aside the impugned order and remanded the matter to the Commissioner (Appeals) to pass a fresh order on all the issues raised in the appeal, including confiscation and redemption fine. The Tribunal highlighted that the issue of redemption fine and penalty sustainability would be considered by the Commissioner (Appeals) during the merit review of the case.

In conclusion, the appeal was allowed by way of remand for a comprehensive reconsideration of all issues involved in the case by the Commissioner (Appeals).