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2023 (7) TMI 68 - AT - CustomsLevy of Customs Duty on Custodian - levy of penalty u/s 117 of CA - no Bill of entry was filed by any person and thus there was no declared value of the goods - vague information received by the Customs department through the Consulate General of India in Hong Kong - HELD THAT - In absence of any inspection at any stage either at the country of loading or load port, nor by the Indian customs after arrival of the said container in India, till the date of joint inspection/ survey on 03.04.2013, when the said container was found empty while lying in the premises of the appellant custodian. There is total darkness, as to what exactly the said container was stuffed with. The demand of duty is wholly based on assumption and presumptions of the goods said to be in the said container. However, it is found that under the Customs Act r/w the HCCAR2009, the appellant was obligated to keep the container in safe custody and to offer the container in sealed condition for inspection etc., which they have failed. It is found that there is contributory negligence on the part of the customs department also, as they have failed to take timely action for disposal of the goods in spite of receiving intimation of the appellant as early as on 03.11.2010 - the demand of duty is set aside penalty is reduced to Rs. 50,000/-. Appeal allowed in part.
Issues:
The issue in this appeal is whether custom duty of Rs. 20,49,765/- on the approximate assessable value Rs. 85,23,640/-, have been rightly demanded from the appellant who is the custodian and further imposition of penalty of Rs. 1 lakh under Section 117. Details of the Judgment: Issue 1 - Demand of Custom Duty and Penalty: The appellant, a custodian, sought relief from the demand of custom duty and penalty imposed by the Customs Department. The Customs Department initiated an enquiry regarding a container that arrived at ICD TKD, which was found to contain goods different from what was initially declared. The appellant argued that the demand of duty was vague and not based on concrete evidence, as the container was never inspected by Indian Customs and no Bill of Entry was filed. The appellant contended that the demand was unjustified due to the lack of negligence on their part and the delay in action by the Customs department. Issue 2 - Failure to Inspect Container: The Tribunal noted that there was no inspection of the container either at the country of loading or upon arrival in India until a joint inspection revealed it to be empty. The demand for duty was deemed to be based on assumptions and presumptions, lacking concrete evidence of the actual contents of the container. The appellant was found to have failed in offering the container in sealed condition for inspection, as required by the Customs Act. Issue 3 - Contributory Negligence: The Tribunal acknowledged contributory negligence on the part of both the appellant and the Customs department. While the appellant failed to comply with the obligation to present the container for inspection, the Customs department also neglected to take timely action for disposal of the goods despite being informed by the appellant. Consequently, the demand of duty was set aside, but the penalty amount was confirmed and reduced to Rs. 50,000. In conclusion, the Tribunal allowed the appeal in part, providing consequential benefits to the appellant.
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