2023 (10) TMI 758 - AT - Customs

Misdeclaration and undervaluation of imported goods - goods declared as steep glass bowl and deep cut glass bowl - seizure of container - HELD THAT - The container was handed over to the custody of the appellant is an admitted fact. When the said admission is seen through the prism of above quoted interpreted provision, it cannot be denied that the said provisions have been violated and that there is lack of diligence towards responsibility of the custodian. However, the appellant though has pleaded its non involvement with panchas at the time of initial inspection when two contradicted panchnamas were prepared and that there was no information of Customs seal bearing No.594385 having been affixed at the time when the container was handed over to appellant, CONCOR and also that the responsibility of the custodian was otherwise given to CISF. There are no cogent difference in the contents thereof except that the time of proceeding is slightly different. In panchnama signed on 2.11.2011, proceedings are mentioned to have started at 12.00 hours and to have ended at 23.00 hours. Whereas for panchnama dated 3.11.2011, the proceedings are mentioned to have started at 12.18 hours on 2.11.2011 and to have got concluded at 00.30 on 3.11.2011. Thus, there is not much difference except 15 minutes/ while beginning one and half an hour time duration while ending the proceedings. Since examination ended post midnight, means date got changed by that time. This cannot be the reason to challenge or to doubt the veracity/correctness of the panchnama. The contention of appellant that it has no knowledge about seal nor any responsibility for the container lying in the customs area/shed is not sustainable. Objection about Customs seal - HELD THAT - The appellant has not brought to notice that it was mandatory for the Customs Inspector to cut seal only in the presence of custodian of CONCOR on 2.11.2011. Admittedly, it was case of mis-declaration and undervaluation and till the request of appellant of joint survey on 15.10.2012 no pilferage was at all noticed. It is clear that presence of CONCOR was mandatory neither on 02/03.11.2011 nor even on 15.10.2012. The examination on 15.10.2012 was though, conducted in presence of CONCOR. Hence, there are no reason to differ from the finding in the order under challenge that at the time drawing panchnama dated 2.11.2011, Customs seal No.594385 was affixed on the container and the said seal was handed over to the CONCOR. Plea about transferring liability to CISF - HELD THAT - Admittedly, there is no such approval in favour of the CISF. All the allegations as fastened against the custodian are under Regulation 6 HCCAR,2009 and section 45 of Customs Act, 1962 i.e. against the approved by custodian, who is none but CONCOR, the appellant. As per section 45 (2) (b) of Customs Act, 1962, the custodian is duty bound to not to permit such goods to be removed from the customs area, except under and in accordance with written permission of proper officer or otherwise dealt with. Admittedly, there was no such permission with CONCOR for removal of the goods. There is no denial that the container had shifted from its location within the customs area. Also the seal of the container was found tampered and most of the goods were found pilfered from the said container. As per section 45, the custodian is burdened with the responsibility of safe custody of imported goods unless and until those goods cleared either for home consumption or for being warehoused. Admittedly, the goods got pilfered and container seal found tempered when the goods were not still cleared - there are no reason to absolve the appellant from the responsibility fastened upon him and violation confirmed. Appeal dismissed.

Summary

Issues Involved:
1. Custody and Responsibility under Section 45 of Customs Act, 1962.
2. Liability under Regulation 6 of Handling of Cargo in Customs Area Regulations, 2009 (HCCAR, 2009).
3. Validity of Panchnama and Examination Proceedings.
4. Role and Responsibility of CISF vs. CONCOR.

Summary:

1. Custody and Responsibility under Section 45 of Customs Act, 1962:
The appellant, CONCOR, was the custodian of the goods under Section 45 of the Customs Act, 1962. The goods, valued at Rs.3,24,93,750/-, were seized due to misdeclaration and undervaluation and were handed over to CONCOR for safe custody. The Tribunal upheld that the custodian is responsible for the safe custody of the goods until they are cleared for home consumption or warehousing. The appellant's argument that the responsibility lay with CISF was rejected, as the statutory mandate under Section 45 places the duty of safe custody on the approved custodian, which was CONCOR.

2. Liability under Regulation 6 of Handling of Cargo in Customs Area Regulations, 2009 (HCCAR, 2009):
Regulation 6 mandates that the Customs Cargo Service provider (CONCOR) is responsible for the safety and security of the goods under its custody. The Tribunal found that CONCOR failed to fulfill its responsibilities as the goods were pilfered, and the container seal was tampered with while in their custody. The Tribunal cited the case of M/s. Continental Warehousing Corporation to emphasize that the custodian cannot permit the removal or tampering of goods without written permission from the proper officer.

3. Validity of Panchnama and Examination Proceedings:
The Tribunal addressed the appellant's objection to the validity of the panchnamas dated 2.11.2011 and 3.11.2011, which documented the examination of the container. It was observed that both panchnamas were consistent in content, despite minor differences in timing, and bore signatures of independent witnesses and the proprietor of the importing company. The Tribunal concluded that the panchnamas were valid and that the Customs seal No.594385 was affixed and handed over to CONCOR for safe custody.

4. Role and Responsibility of CISF vs. CONCOR:
The appellant's argument that CISF was responsible for the security of the container was dismissed. The Tribunal clarified that the statutory responsibility under Section 45 and Regulation 6 lies with the approved custodian, CONCOR, and not CISF. The Tribunal emphasized that CONCOR, as the custodian, was liable for the pilferage and tampering of the container seal.

Conclusion:
The Tribunal upheld the order under challenge, confirming the liability of CONCOR for the pilferage and tampering of the container seal under Section 45 of the Customs Act, 1962, and Regulation 6 of HCCAR, 2009. The appeal was dismissed.