2023 (8) TMI 1054 - AT - Customs

Valuation of imported goods - mis-declaration with regard to value of the goods - Suppression of facts or not - confiscation - redemption fine - penalty - HELD THAT - In case, where the duty has been non-levied or short-levied, owing to the reason of collusion or any willful mis-statement or suppression of facts, it has been mandated in Section 114A ibid that the person who is liable to pay the duty, as determined under subsection (8) of Section 28 ibid, shall also be liable to pay a penalty equal to the duty so determined. However, the first proviso appended to Section 114A ibid, considers for payment of 25% of determined amount of duty, in the eventuality where such duty is paid within 30 days from the date of communication of the order. In the present case, payment of the disputed duty amount along with interest is not in question inasmuch as such amount was paid by the appellants during the course of investigation, and the same has also been appropriated in the adjudication order. Further, it is not the case of Revenue that the appellant M/s Zuari Structural Works Engineers had not paid 25% of penalty within the period of 30 days from the date of communication of the adjudication order. In this context, the Learned Advocate appearing for the appellants has stated that the reduced penalty amount was deposited on 18.01.2013 - the impugned order, to the extent it has upheld confirmation of the penalty amount equal to the adjudged amount of duty and interest on the appellant M/s Zuari Structural Works Engineers cannot be sustained and accordingly, is liable to set aside. Hence, the impugned order upholding confirmation of equal amount of penalty is set aside and the appeal to such extent is allowed in favour of the appellant. Imposition of penalty under Section 114A ibid on Shri Gurudas Kamat, partner of the appellant M/s Zuari Structural Work Engineers - HELD THAT - nsofar as imposition of penalty under Section 114A ibid is concerned, the said provision can only be invoked in the case of the importer, engaged in importation of goods into India. Since, the appellant Shri Gurudas Kamat is not an importer of the subject goods in the present case and that the said statutory provision has already been invoked for short-levy or non-levy of duty on the importer, we are also of the view that penal provisions contained in Section 114A ibid cannot be invoked for imposition of penalty on the appellant herein. Therefore, on this ground, the appeal filed by Shri Gurudas Kamat is allowed by setting aside the impugned order to this extent. Confiscation - redemption fine - penalty - HELD THAT - The appellant herein is a high sea s purchaser of the goods and filed the Bill of Entry for clearance of the goods from the customs custody. Since,all the related documents were submitted at the time of assessment of the goods in question, it cannot be said that the provisions of Section 111(m) ibid have been contravened, inasmuch as there is no mis-declaration of value and also acknowledging the fact that appellant should not be held responsible for mis-declaration of goods and confiscation of the goods, the original authority had rightly imposed penalty on M/s. Mallesh Co. by invoking the provisions of Section 112(a) ibid. Since, the Department has recognized M/s. Mallesh Co.,as High Sea seller and a distinct person in the transaction between the overseas seller and the appellant herein, the appellant being the high sea s purchaser cannot be penalized for confiscation of the goods under Section 111(m) ibid. Therefore, the impugned order imposing redemption fine of Rs. 3,03,000/- on the appellant is set aside and the appeal is allowed in favour of the appellant. Appeal disposed off.

Summary

Issues involved: Appeal against order of Commissioner of Customs upholding re-determination of assessable value, confiscation of goods, and imposition of penalty under Customs Act, 1962.

Re-determination of assessable value and confiscation of goods:
The appellants contested the order on the grounds of no mis-declaration of goods' value, seeking benefit under Section 114A for timely payment of duty and penalty. The appellant M/s. Zuari Structural Works & Engineers had paid the duty amount along with interest during adjudication proceedings and 25% of the penalty within the stipulated time. The appellant Shri Gurudas Kamat, not being the importer, argued against the application of penalty provisions. The Tribunal noted the timely payment by the appellants and held that no further penalty should be imposed, setting aside the penalty confirmed on M/s. Zuari Structural Works & Engineers.

Imposition of penalty on non-importer:
Regarding the appeal by Shri Gurudas Kamat, a partner of M/s. Zuari Structural Works & Engineers, the Tribunal ruled that penalty provisions under Section 114A cannot be applied to him as he is not the importer of the goods in question. The appeal by Shri Gurudas Kamat was allowed, setting aside the penalty imposed on him.

Confiscation of goods and imposition of redemption fine:
In the case of confiscation of goods and imposition of redemption fine, the Tribunal observed that the appellant was a high sea purchaser who submitted all required documents for customs clearance. As there was no mis-declaration of value, the provisions of Section 111(m) were not contravened. The original authority rightly penalized M/s. Mallesh & Co., recognized as a distinct entity, for any mis-declaration. The Tribunal held that the appellant, being the high sea purchaser, should not be penalized for confiscation under Section 111(m). Consequently, the redemption fine imposed on the appellant was set aside, and the appeal was allowed in favor of the appellant.

Conclusion:
Both appeals were disposed of in favor of the appellants, setting aside penalties and redemption fines imposed, based on the timely payment of duties and the non-applicability of penalty provisions on a non-importer.