2018 (11) TMI 1401 - AT - Customs

Clandestine removal - made ups and ready to wear garment like shirts, ladies night wear - seizure of said goods - Held that - As regard the goods were intercepted in the bus of the appellant M/s SCCPL at check post. It is clear that the goods were intended to be taken out from SEZ premises, however the goods were not cleared out of SEZ, therefore, no liable to duty at that stage - However, since, there was attempt of clandestine removal, the goods were correctly liable for confiscation. Hence, the confiscation of the goods i.e. 789 pieces of readymade garment and consequential redemption fine is upheld. Confiscation of the goods at the premises of Maruti Trading Company and Ashok Industries - Held that - As per reconciliation provided by the appellant, the goods shown to have purchased by both the units are well within the duty paid goods cleared by M/s. Saffire Clothing Co. Pvt Ltd. Moreover, there is no evidence of movement of goods without payment of duty from SEZ to M/s. Maruti Trading Company and Ashok Industries. Since, there is physical checking at the check post and no evidence was found that any goods over and above the goods recorded, which were cleared on payment of duty were found, it cannot be said that the goods found in the premises of M/s. Maruti Trading Company and Ashok Industries is a clandestine removal from the appellants company - In the present case the goods were seized from premises of Maruti Trading Company and Ashok Industries, therefore, the confiscation and redemption fine against the appellant is illegal and incorrect - neither the goods found in premises of M/s Maruti Trading Company and Ashok Industries was liable to confiscation nor it is attract duty as same was not proved to have been cleared clandestinely from the premises of the M/s SSCPL therefore, the demand on the goods seized from the Maruti Trading Company and Ashok Industries is set aside. Penalty on employees - Held that - Majority of demand is set aside, moreover the employees are not beneficiary against any offence committed, if any - the employees are not liable for penalty. Appeal allowed in part.

Summary

Issues:
- Seizure of readymade garments from different premises
- Confiscation of goods and imposition of fines
- Demand for duty and penalties
- Appeal against the order passed by the Commissioner of Customs

Seizure of Goods: The case involved the seizure of readymade garments from various premises, including a bus intercepted at a check post and premises of Maruti Trading Co. and Ashok Industries. The goods were alleged to be removed clandestinely from a Special Economic Zone (SEZ) without payment of duty.

Confiscation and Fines: The Commissioner of Customs ordered the confiscation of seized goods and imposed redemption fines on the appellant. The order included demands for duty amounts against the appellant for the seized goods found at different locations.

Demand for Duty and Penalties: The Commissioner confirmed the duty demands against the appellant for the seized goods and imposed penalties under various sections of the Customs Act, 1962 on the appellant and its employees. The penalties were also imposed on individuals associated with the seized goods.

Appeal Against the Order: The appellant challenged the order, arguing that the goods seized at the check post were not intended for clandestine removal as they were within the SEZ premises. The appellant disputed the confiscation and fines imposed, claiming no duty was payable as the goods were not cleared out of the SEZ. The appellant also contended that the confiscation and penalties imposed on employees were unjust.

Judgment: The Tribunal upheld the confiscation and fines for the goods intercepted at the check post due to the attempt of clandestine removal. However, it set aside the penalty attributed to the duty demand as duty was not chargeable at the confiscation stage within the SEZ. The Tribunal found no evidence of clandestine removal for goods seized at Maruti Trading Co. and Ashok Industries, setting aside the demand for duty and penalties. It also ruled that penalties on employees were unwarranted and abated the appeal of a deceased individual. Overall, the Tribunal partly allowed the appeal of the appellant and allowed the appeals of other parties involved, while abating the appeal of the deceased individual.