2009 (2) TMI 184 - AT - Customs

Export Goods Commissioner has held that the exporter/CHA have failed to perform their duties properly as they did not inform the Shipping Agent to stop the containers from being loaded without the supervision and approval of the officer of Customs; and that they did not make any genuine attempt to stop the container from being loaded before sailing of the vessel held that - There is nothing on record to hold that the exporter/CHA have handed over the containers to the Shipping line for loading after entry into the dock. Being the Customs area it is under the custody and control of the custodian. In fact the letter dated 8-6-07 from the CHA states that on 15-1-07 when the CHA went to hand over out of charge Shipping bill to the Shipping Co. at that the time they came to know that the vessel has already sailed. - confiscation of the goods already exported which are not available for confiscation and imposing redemption fine on the exporter is not correct

Issues:
1. Confiscation of goods under Customs Act, 1962.
2. Compliance with Customs Act provisions by exporter/CHA.
3. Liability of exporter/CHA in loading of export goods.
4. Imposition of redemption fine and penalties.
5. Precedent value of Tribunal's decision.

Analysis:

Issue 1: Confiscation of goods under Customs Act, 1962
The Commissioner held that the exported goods were liable for confiscation under Section 113(f) and (g) of the Customs Act, 1962, due to procedural lapses. The goods were ordered to be confiscated with an option for redemption on payment of a fine. However, the Tribunal found that the confiscation of already exported goods, which were not available for confiscation, and imposing a redemption fine was not in line with previous Tribunal orders. The Tribunal referred to specific cases to support its decision, emphasizing that the redemption fine was not sustainable.

Issue 2: Compliance with Customs Act provisions by exporter/CHA
The Tribunal examined whether the exporter and Customs House Agent (CHA) had fulfilled their duties under the Customs Act, 1962. It was noted that the exporter/CHA had presented the shipping bill to the proper officer as required by Section 50(1) of the Act. The Tribunal highlighted that the responsibility for supervising the loading of export goods onto conveyances, as per Sections 34 and 36, lay with Customs, not the exporter/CHA. The Tribunal concluded that there was no evidence to suggest non-compliance by the exporter/CHA.

Issue 3: Liability of exporter/CHA in loading of export goods
The Tribunal scrutinized the actions of the exporter/CHA regarding the loading of export goods onto the vessel. It was observed that the exporter/CHA had no knowledge that the containers were being loaded without proper supervision or approval. The Tribunal emphasized that the Customs should have ensured proper supervision during loading and that the exporter/CHA had not instructed the shipping line to load the containers without permission. The Tribunal found no incriminating conduct on the part of the exporter/CHA.

Issue 4: Imposition of redemption fine and penalties
Regarding the imposition of redemption fine and penalties, the Tribunal held that there was no basis for penalizing the exporter/CHA. It referenced a Supreme Court judgment to emphasize that penalties should be imposed only in cases of deliberate defiance of the law or contumacious conduct, which was not evident in this case. The Tribunal found no evidence to support the imposition of penalties on the exporter/CHA and set aside the penalties imposed by the Commissioner.

Issue 5: Precedent value of Tribunal's decision
The Tribunal discussed the precedent value of a previous Tribunal judgment cited by the Learned SDR. It noted that the decision was under challenge before the High Court, and until its finality was established, it could not be considered as a binding precedent. The Tribunal emphasized that reliance on a decision not yet finalized could not be justified, citing relevant legal precedents.

In conclusion, the Tribunal set aside the Commissioner's order regarding redemption fine and penalties, ruling in favor of the exporter and the CHA. The judgment highlighted the importance of procedural compliance, the role of Customs in supervising loading, and the necessity of evidence to support penalties under the Customs Act, 1962.

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