2020 (2) TMI 521 - HC - Customs

Imposition of fine and parallel penalty - alleged sale of 254 sewing machines out of the imported lot of 554 machines - HELD THAT - Since two parallel proceedings were drawn against the Assessee on similar set of facts and one with the D.G.F.T., Department has resulted in favourable order at the hands of the competent authority under the Foreign Trade Development and Regulation Act, 1992, those facts and circumstances of the case deserve to be taken into account by the competent authority viz., Commissioner of Customs under the provisions of the Customs Act, 1962. The Commissioner of Customs to decide the issue of imposition of fine and penalty de-novo uninfluenced by the order passed by the learned Tribunal, taking into account the subsequent circumstances which had developed in the case.

Summary

Issues:
1. Imposition of penalty on the Assessee by the Customs Excise and Service Tax Appellate Tribunal.
2. Reduction of penalty by D.G.F.T authorities in parallel penalty proceedings.
3. Request for reconsideration of fine and penalty by the Assessee.
4. Support of the impugned order by the Special Government Pleader.
5. Direction to the Commissioner of Customs to decide on the fine and penalty de-novo.

The High Court judgment dealt with an appeal filed by the Assessee against the Customs Excise and Service Tax Appellate Tribunal's order upholding the imposition of a penalty. The Tribunal had imposed a duty on machines not installed or found, along with a redemption fine and penalty for the Assessee's default. The Assessee argued that they had fulfilled export obligations and highlighted the reduction of penalty by D.G.F.T authorities in parallel proceedings. The Assessee requested the Commissioner of Customs to reconsider the fine and penalty in light of the developments with the D.G.F.T authority. The Special Government Pleader supported the Tribunal's order.

The High Court, considering the parallel proceedings and the favorable outcome with the D.G.F.T authority, directed the Commissioner of Customs to decide on the imposition of fine and penalty afresh, without being influenced by the Tribunal's order. The Court emphasized the need for the Commissioner to consider the subsequent circumstances objectively. The Assessee was granted the opportunity to file a fresh application for waiver or reduction of the fine and penalty before the Commissioner, who was instructed to assess the request fairly and in accordance with the law. The appeal was disposed of with these directions, without addressing the substantial legal questions raised. No costs were awarded in this matter.