2018 (8) TMI 109 - AT - Customs

Penalties u/s 112(a) and 114AA of the Customs Act, 1962 - it was alleged that appellants have concealed the facts regarding actual weighment and providing of correct description of the imported goods from the Customs department - Held that - Sections 112(a) and 114AA of the Act provides for imposition of penalty for improper importation of goods and use of false and incorrect material respectively. Sections 112(a) of CA - Held that - In the instant case, it is an admitted fact that the goods in question were confiscated under Section 111(l) and 111(m) of the Act and the same were redeemed on payment of redemption fine. Thus, it is not in dispute that for the wrongful acts and deeds, the goods were rendered liable for confiscation and accordingly, the provisions contained in Section 112 of the Act are satisfied for imposition of penalty - however, the quantum of penalty reduced. Penalty u/s 114AA of CA - Held that - In absence of any specific findings with regard to sign / using of any declaration, statement or document, the provisions of Section 114AA of the Act cannot be invoked for imposition of penalties on the appellant - penalty set aside. Appeal allowed in part.

Summary

Issues involved: Imposition of penalties under Sections 112(a) and 114AA of the Customs Act, 1962.

Analysis:

1. Issue of Section 112(a) Penalty Imposition:
The case involved the mis-declaration of imported goods, where PVC leather cloth was imported instead of PVC sheets, leading to a discrepancy in quantity and weight. The authorities invoked Section 112(a) of the Customs Act, which penalizes acts or omissions rendering goods liable to confiscation. It was established that the goods were confiscated under Section 111(l) and 111(m) of the Act, satisfying the conditions for penalty imposition. The judgment found that the individuals involved had concealed crucial information from the Customs department, justifying the penalty imposition. However, considering the gravity of the offense, the penalty amount was reduced from ?1 lakh to ?50,000 for each appellant.

2. Issue of Section 114AA Penalty Imposition:
The judgment highlighted that the penalties under Section 114AA of the Act were set aside. This section pertains to penalties for knowingly making false declarations or documents. The Commissioner (Appeals) did not provide specific findings regarding intentional false declarations by the appellants. As a result, the provisions of Section 114AA could not be invoked for penalty imposition. Therefore, the penalties under Section 114AA were overturned, and the appeals were allowed in favor of the appellants.

In conclusion, the judgment modified the impugned order by reducing the penalties imposed under Section 112(a) from ?1 lakh to ?50,000 for each appellant. The penalties under Section 114AA were set aside, and the appeals were partly allowed. The decision was based on a thorough analysis of the provisions of the Customs Act and the specific circumstances of the case.