2017 (7) TMI 117 - AT - Customs

Penalty u/s 112 of CA - alleged beneficiary of the import and the role of other individuals in the transaction - Held that - Section 112 of Customs Act, 1962 prescribes the imposition of penalty for any act that may, directly or indirectly, have contributed to the confiscation of the goods. The appellant had concerned himself with the documentation that enabled the waiver of prescriptions relating to the advance licences as well as with the engagement of agents to handle the cargo are not disputed or controverted. It was the purportedly genuine appearance accorded to the fabricated shipping bills by involving custom house agents that enabled the ostensible importer to avail exemption from duty on the goods that were imported. The link between the appellant and the imported goods has been clearly established in the impugned order. The penal provision does not require a direct and proximate contact with the offending goods. A link is sufficient. That is established in the impugned order. Appeal dismissed - decided against appellant.

Summary

Issues:
Duty liability on imports, interest, penalty under Customs Act, 1962, Challenge to impugned order, Role of appellant in import scheme, Imposition of penalty under section 112 of Customs Act, 1962, Tribunal's findings, Appellant's arguments, Applicability of legal precedents, Link between appellant and imported goods, Dismissal of appeal.

Analysis:
The judgment by the Appellate Tribunal CESTAT MUMBAI involves multiple issues related to duty liability on imports, interest, and penalties under the Customs Act, 1962. The impugned order-in-original dated 22nd June 2005 imposed duty liability, interest, and penalties on the ostensible importer and the appellant. The appellant challenged the order, arguing that he had no involvement in the confiscated goods, and the notice did not specify his role in the confiscation. Additionally, the appellant contested the penalty under section 112 of the Customs Act, 1962, based on his alleged connection with the shipping bills and custom house agents.

The Tribunal delved into the circumstances that led to proceedings against the appellant. It was revealed that the import of 'brass scrap' was done under the Duty Exemption Entitlement Certificate (DEEC) scheme with an obligation to export 'brass artware.' Investigations uncovered a scheme involving fabricated shipping bills to enable duty-free imports. The appellant was found to have played a crucial role by introducing individuals involved in the scheme and liaising with key persons, as highlighted in the impugned order.

The Tribunal analyzed the evidence presented and concluded that the appellant had a significant role in the import scheme. The appellant's involvement in facilitating the waiver of license prescriptions and engaging custom house agents to handle the cargo was established. The link between the appellant and the imported goods was deemed sufficient for imposing penalties under section 112 of the Customs Act, 1962.

Despite the appellant citing previous decisions, the Tribunal emphasized that the imposition of penalties is based on the facts of each case. The Tribunal upheld the impugned order, noting that the appellant's involvement in the import documentation and engagement of agents was crucial in enabling the duty exemption. The judgment highlighted that a direct link with the goods is not necessary for imposing penalties; establishing a connection is sufficient.

Ultimately, the Tribunal dismissed the appeal, affirming the impugned order's findings and the imposition of penalties on the appellant. The judgment was pronounced in court on 12/06/2017, concluding the legal proceedings in this matter.