2023 (4) TMI 1145 - AT - Customs

Levy of penalty u/s 41 of the customs Act, 1962 - levy on the allegation that the appellants have not filed the EGM within a stipulated period of 7 days in terms of section 41 of the Customs Act, 1962 - HELD THAT - As per the Sub Section (1) of Section 41, the person shall be liable to pay penalty not exceeding Rs. 50,000/-, if he fails to deliver the departure manifest or export manifest or the export report or any part thereof within stipulated time period as prescribed under regulation 3(3) of Export Manifest (Vessel) Regulations, 1976. With this provision there is rider that the said provision shall apply in case when the proper officer is satisfied that there is no sufficient cause for such delay - In the present case there is no dispute that the appellant had filed EGM within the stipulated time period. Subsequently, the Supplementary EGM was filed. Such Supplementary EGM was accepted by the proper officer. Therefore, it is clear that the proper officer has found sufficient cause for delay by accepting the supplementary EGM. Moreover, Sub Section 3 clearly provides that in case of incorrect or incomplete EGM and that there was no fraudulent intention, the proper officer on his satisfaction may permit such manifest or report to be amended or supplemented - In the present case firstly, the appellants have filed EGM within stipulated time period and subsequently supplemented by filing correct Supplementary EGM which has been accepted. This shows that the appellants have complied with the provision of Section 41 in its entirety. The Contention of the Revenue is that the date of filing of EGM is not initial filing of EGM but the filing of Supplementary EGM hence, there is delay is in clear contradiction of the statutory provision of Section 41 (1) read with sub section 3 of customs act, 1962. This view taken by the lower authority is absolutely illegal, hence not acceptable - Appeal allowed.

Summary

Issues Involved:
The judgment involves issues related to penalties imposed under section 41 of the Customs Act, 1962 for alleged failure to file EGM within the stipulated time period.

Issue 1: Alleged violation of Section 41 and imposition of penalties
The Commissioner (Appeals) imposed penalties under section 41 of the Customs Act, 1962 on the appellants for not filing the EGM within the prescribed 7-day period. The appellants argued that they filed the EGM within the stipulated time but later submitted supplementary EGM for corrections. The appellants contended that as per Section 41(3), they were allowed to amend or supplement the EGM, and hence, no penalty should be imposed. They cited relevant circulars and judgments in support of their argument.

Issue 2: Interpretation of Section 41 and compliance with statutory provisions
The key issue was whether the appellants violated Section 41 and were liable for penalties. Section 41 mandates the timely delivery of EGM failing which penalties may be imposed. However, the provision also allows for amendments or supplements to be made to the EGM. The proper officer accepted the supplementary EGM submitted by the appellants, indicating compliance with the statutory provision. The judgment emphasized that the appellants had filed the EGM within the stipulated time and later supplemented it, which was permitted by law. The Revenue's contention that the date of filing the supplementary EGM constituted the actual filing date was deemed contrary to the statutory provisions of Section 41.

Conclusion:
The Tribunal set aside the impugned orders and allowed the appeals, ruling in favor of the appellants. The judgment highlighted the compliance of the appellants with Section 41 of the Customs Act, 1962 by filing the EGM within the prescribed time and subsequently supplementing it as permitted by law. The decision emphasized the proper officer's acceptance of the supplementary EGM as evidence of compliance with the statutory provisions, leading to the dismissal of the penalties imposed.