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2024 (1) TMI 145 - AT - CustomsValidity of order of forfeiture of security deposit and imposition of penalty - charge of mis-classification by the importer - HELD THAT - In the present case the appellant was imposed with the penalty of Rs. 50,000/- and also their deposit was forfeited only on the ground that the appellant was involved in connection with the offence committed by M/s. Ridava Petrochemicals Pvt. Ltd. The case of RIDAVA PETROCHEMICALS PVT LTD VERSUS C.C. -KANDLA 2023 (3) TMI 842 - CESTAT AHMEDABAD has been decided by this Tribunal in the favour of the importer. From the above decision, it can be seen that the entire foundation of the present is the case of alleged mis-classification by M/s. Ridava Petrochemicals Pvt. Ltd in respect of the imported goods which was handled by present Custom Broker - Since, the case of M/s. Ridava Petrochemicals Pvt. Ltd has been quashed by allowing the appeal, the entire foundation itself got demolished. Therefore, no consequential punishment can be given to the present appellant. The impugned order set aside - appeal allowed.
Issues involved:
The issues involved in this case are the forfeiture of security deposit and imposition of penalty on the Custom Broker due to alleged involvement in the offense committed by another party, M/s. Ridava Petrochemicals Pvt. Ltd, in relation to the mis-classification of imported goods. Details of the Judgment: Issue 1: Forfeiture of Security Deposit and Imposition of Penalty The appeal was directed against an Order-in-Original passed by the Learned Commissioner, Customs, Kandla, where the security deposit of the Custom Broker was forfeited and a penalty of Rs. 50,000 was imposed. The appellant contended that the entire case against them was based on the charges made against M/s. Ridava Petrochemicals Pvt. Ltd, which had been decided in favor of the importer by the Tribunal. As the foundation of the case against the appellant was the charge of mis-classification by M/s. Ridava Petrochemicals Pvt. Ltd, which was quashed, the order of forfeiture and penalty could not be sustained. The Tribunal, after considering the submissions and records, found that the penalty and forfeiture were imposed solely based on the appellant's alleged connection with the offense committed by M/s. Ridava Petrochemicals Pvt. Ltd. Therefore, the penalty and forfeiture were set aside, and the appeal was allowed. Issue 2: Compliance with IS 4117-1973 (2008) Standards The Circular issued by the Board regarding the denaturation of imported ethyl alcohol was examined in detail. It was observed that the Circular's requirement of compliance with IS 4117-1973 (2008) related to alcohol denaturants applied to goods meant for clearance into India, not those intended for re-export and use outside India. As the disputed goods were imported and bonded for re-export, the charges of mis-declaration based on non-compliance with the standard were found to be misconceived and unsustainable. The Tribunal also noted that the Circular did not apply to the appellant's case, where the goods were not meant for any use in India. Therefore, the allegation of mis-declaration based on non-compliance with IS 4117-1973 (2008) was set aside. Issue 3: Penalty under Section 114AA of the Customs Act, 1962 Regarding the penalty under Section 114AA of the Customs Act, 1962 for a mismatch in the date of bill of lading, it was found that the date mentioned in the bill of lading was corroborated by various statements and evidence. The allegation that the date of lading was incorrect was deemed unjustified. Additionally, the penalty imposed under Section 117 of the Customs Act, 1962 for discrepancies in the description of goods was found to be unwarranted as there was no mis-declaration on the part of the appellant. The inability to produce a manufacturer's invoice, due to the supplier's unwillingness, did not constitute an offense attracting penalties. Therefore, the penalties under Sections 114AA and 117 were set aside. In conclusion, the Tribunal held that the order of confiscation and subsequent penalties was legally and factually flawed. The confiscation, redemption fine, and penalties imposed on the appellants were set aside, and the appeal was allowed with consequential relief. This summary provides a detailed overview of the judgment, highlighting the key issues and the Tribunal's findings on each issue.
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