2023 (10) TMI 361 - AT - Customs

Levy of penalty u/s 112(b) and u/s 114AA of CA - Penalty on logistic service provider - Misdeclaration of imported goods - mobile accessories found inside the container whereas the goods declared was assorted chappals - role of appellant in such abetting of misdeclaration - absence of mens rea - HELD THAT - The appellant has filed IGM in the normal course based on the documents available with him, wherein the description has been mentioned as assorted chappals . Subsequently they have got the amendment done only on the basis of instructions received from the proprietor of M/s Great Overseas, Mr M.A. Mujahid which is also confirmed by him in his recorded statements. Therefore, there cannot be ulterior motive on their part to have filed the IGM and the amendment request letter. However, this is a case of negligence on their part to specifically not to pose any query the importer as to why the description in the invoices is different from the description given earlier in the Bill of Lading, While agreeing with the appellant that there is no ulterior motive in the entire passage, the learned A.R. agreed upon that act of appellant has been negligent. The penalty imposed under section 112(b) set aside - The penalty imposed under section 114AA is reduced to Rs 50,000/- - appeal allowed in part.

Summary

Issues:
The issues involved in the judgment are the penalty imposed on the logistic service provider under section 112(b) and section 114AA of the Customs Act 1962 for a consignment declared as assorted chappals but found to contain mobile spare parts/mobile accessories upon inspection.

Summary:

Issue 1: Penalty under section 112(b) and section 114AA

The appellant, a logistic service provider, filed an Import General Manifest (IGM) declaring a consignment as assorted chappals based on the Bill of Lading description. Subsequently, upon inspection, it was discovered that the consignment actually contained mobile spare parts/mobile accessories. The appellant requested an amendment to the IGM as per the importer's instructions. The Department imposed penalties under section 112(b) and section 114AA of the Customs Act 1962. The appellant argued that they were not aware of the actual contents of the container and had acted based on the information available. The appellant's counsel contended that there was no evidence of their involvement in the misdeclaration. However, the Department argued that the appellant had access to information indicating the presence of other items besides chappals in the container during the amendment process. The Tribunal found that while there was no ulterior motive, the appellant's negligence in not verifying the discrepancy in descriptions warranted a penalty. Consequently, the penalty under section 112(b) was set aside, and the penalty under section 114AA was reduced to Rs 50,000.

The judgment highlights the importance of due diligence and verification in declaring consignment contents accurately, even when amendments are requested by importers. The Tribunal acknowledged the appellant's lack of malicious intent but emphasized the need for vigilance in ensuring consistency between documentation and actual goods.