2016 (11) TMI 1138 - AT - Customs

Mis-declaration/suppression of imported goods - Slack Wax and Residue Wax - High Sea Sales - whether the ground that declared value does not reflect the transaction value and the value was grossly undervalued to evade Customs duty justified? - Held that - I find that learned Commissioner (Appeals) after taking into overall facts and circumstances of the case has reduced the penalties imposed on the appellants which is reasonable and needs no further interference. The impugned order is upheld and both the appeals are dismissed.

Summary

Issues:
Imposition of penalty under Section 112/114AA of the Customs Act, 1962 for alleged mis-declaration/suppression of imported goods in the Bill of Entry.

Analysis:
In this case, the appellants challenged the penalties imposed by the lower authorities under Section 112/114AA of the Customs Act, 1962 for alleged mis-declaration/suppression of imported goods in the Bill of Entry. The penalties were initially set at ?2 lakhs and ?25,000 for the appellants, which were reduced to ?10,000 and ?5,000 respectively by the learned Commissioner (Appeals). The appellants contested the penalties, seeking their complete annulment. The investigation revealed that certain imported goods were undervalued, leading to evasion of Customs duty, allegedly in collusion with the appellants. The appellants argued that Section 114AA could not be invoked, and hence, the penalties were unjustified.

The appellant's counsel contended that the penalties were not warranted as there was no specific allegation in the show-cause notice, and Section 114AA could not be applied in this scenario. It was argued that since the learned Commissioner (Appeals) acknowledged that Section 114AA was inapplicable, the penalties should have been entirely revoked rather than merely reduced. On the other hand, the Departmental Representative (D.R) argued that the penalties had already been reduced significantly by the learned Commissioner (Appeals), demonstrating leniency towards the appellants. Therefore, the D.R recommended the dismissal of the appeals.

Upon careful consideration of the arguments presented by both parties and a thorough review of the case records, the judge upheld the decision of the learned Commissioner (Appeals) to reduce the penalties imposed on the appellants. The judge deemed the reduction of penalties to be reasonable given the overall facts and circumstances of the case, and found no grounds for further intervention. Consequently, the judge dismissed both appeals, affirming the penalties as reduced by the learned Commissioner (Appeals). The operative part of the order was pronounced in open court on 29.08.2016.