2017 (11) TMI 358 - AT - Customs

Penalty u/s 112(b) of CA - Clandestine removal - clearance of duty free imported fabric in domestic area without payment of duty - Held that - fact is not under dispute that appellant Mr. Shahid Yusuf Qureshi has escorted the truck loaded with offended goods which were cleared without payment of duty by M/s. Mayur Impex. Since, he has escorted the goods he was aware about the offending nature of the goods. Moreover, he was continuously coordinating on phone with the supplier of the goods, therefore it cannot be said that he without knowledge escorted the goods, therefore his handling of offended goods clearly falls under the provision of Section 111 of Customs Act, 1962 - penalty rightly imposed - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Imposition of penalty under Section 112(b) of Customs Act on the appellant for involvement in the clandestine clearance of duty-free imported fabric.
2. Allegation of contravention under Section 111 without which penalty under Section 112(b) cannot be imposed.
3. Comparison of appellant's role with other individuals in similar case.

Analysis:
1. The case involved the imposition of a penalty under Section 112(b) of the Customs Act on the appellant, who was involved in the clandestine clearance of duty-free imported fabric in the domestic market. The appellant, Mr. Shahid Yusuf Qureshi, had escorted a truck loaded with the offending goods, which were cleared without payment of duty by M/s. Mayur Impex, a manufacturing unit operating as a 100% EOU. The appellant was aware of the offending nature of the goods as he had continuously coordinated on the phone with the supplier of the goods. The adjudicating authority found that the appellant's handling of the offended goods fell under the provision of Section 111 of the Customs Act, making him liable for penalty under Section 112(b.

2. The appellant's counsel argued that no contravention under Section 111 was alleged in the show cause notice, and without such an allegation, penalty under Section 112(b) could not be imposed. The counsel cited various judgments to support this argument. However, the Assistant Commissioner representing the Revenue reiterated the findings of the impugned order and emphasized that the appellant's role was different from that of other individuals involved in the case. While the other three persons had their appeals allowed by the Tribunal, the appellant's direct involvement in handling the offended goods from Vashi to Ulhasnagar made him liable for penalty under Section 112(b) as his offense fell under Section 111 of the Customs Act.

3. Upon careful consideration of the submissions from both sides, the Member (Judicial) found that the appellant's role in escorting the truck loaded with offended goods clearly indicated his awareness of the nature of the goods. His continuous coordination with the supplier further established his knowledge of the offending nature of the goods. The Member concluded that the appellant's actions fell under the provision of Section 111 of the Customs Act, making him liable for penalty under Section 112(b. The Member dismissed the appeal, stating that there was no reason to interfere with the imposition of the penalty ordered by the lower authority.