2016 (11) TMI 133 - AT - Customs

Misdeclaration of country of origin - Recovery of differential duty - imposition of penalty u/s 114A/112 of Customs Act, 1962 - N/N. 73/2005-Cus, dt.22.07.2005 - concessional rate of duty - country of origin of goods - whether the Appellant s approach was bonafide in declaring the country of origin as Singapore and availing the benefit of Notification No.73/2005-Cus.? - reliance placed on the decision of case 2012 (1) TMI 157 - CESTAT AHMEDABAD - Held that - on the imports made by other Appellants, in Jesons Industries Ltd. s case this Tribunal has already confirmed the demand and imposed penalty involving the same overseas supplier, wherein the country of origin was mis-declared as Singapore. Broadly, we do not find any difference between the facts stated in the said case and the present one. In the circumstances, the penalty under Section 114A of Customs Act, 1962 against the Appellant is unsustainable. Accordingly, we confirm the penalty imposed by the learned Commissioner on the Appellant under Section 114A of Customs Act, 1962. However, the Appellants are entitled to discharge 25% of the penalty, which option has not been allowed to them in the impugned order. Accordingly, Appellants are allowed to discharge 25% of the penalty, subject to fulfillment of conditions laid down under Section 114A of Customs Act, 1962. The impugned order is modified accordingly and the appeal is partly allowed to the above extent.

Summary

Issues:
- Dispute over imposition of penalty under Section 114A of Customs Act, 1962 for mis-declaration of country of origin in import of Butyl Acrylate Monomer (BAM).
- Bonafide intention of the Appellant in declaring the country of origin as Singapore and availing the benefit of Notification No.73/2005-Cus.
- Comparison with a similar case involving mis-declaration of country of origin and penalty imposition.

Analysis:
1. The appeal was against the imposition of penalty under Section 114A of Customs Act, 1962 for mis-declaration of the country of origin in the import of Butyl Acrylate Monomer (BAM). The Appellant disputed the penalty but not the duty, claiming they were unaware of the mis-declaration by the overseas supplier. The Appellant argued that they voluntarily approached the Customs authorities to discharge the differential duty, indicating their bonafide intention. The Revenue contended that the Appellant failed to inform the department about the mis-declaration until after investigations were initiated against other importers. The Tribunal found that the Appellant's actions were not bonafide as they cleared goods for two months without informing the department, similar to a case where penalty was confirmed for mis-declaration of country of origin.

2. The issue of bonafide intention in declaring the country of origin was crucial. The Appellant claimed they approached the Customs authorities voluntarily to pay the differential duty, showing their bonafide intent. However, the Revenue argued that the Appellant's delay in informing the department until after investigations began against other importers indicated otherwise. The Tribunal sided with the Revenue, stating that the Appellant's actions did not demonstrate bonafide intention, especially considering the similar case where penalty was confirmed for mis-declaration of country of origin.

3. A comparison was drawn with a similar case involving mis-declaration of the country of origin and penalty imposition. The Tribunal noted that in the previous case, penalty was confirmed for mis-declaration of country of origin involving the same overseas supplier. The Tribunal found no significant difference between the facts of that case and the present one, leading to the confirmation of penalty under Section 114A of Customs Act, 1962 for the Appellant. However, the Tribunal allowed the Appellants to discharge 25% of the penalty, subject to fulfilling conditions laid down under the Act, modifying the impugned order accordingly.