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Allegations of mis-declaration and penalty imposition under Section 114 of the Customs Act. Analysis: The appeals arose from the Commissioner of Customs, Kandla's order regarding 8 DEEC Shipping Bills filed by M/s. Satyam Enterprises for export. The Customs authorities discovered discrepancies as the export product did not contain the chemicals listed in the DEEC license granted to M/s. Stonemann. Consequently, the Shipping Bills were converted into Free Shipping Bills, and exports proceeded. Subsequent investigation revealed that M/s. Satyam Enterprises exported goods under different Shipping Bills without importing the entitled chemicals, leading to allegations of connivance to evade import duty. The Commissioner upheld the allegations, de-logged the Shipping Bills, and imposed significant penalties on the involved parties. The Commissioner invoked penalties under Section 114 of the Customs Act, which pertains to acts or omissions rendering goods liable to confiscation. However, the order lacked a definitive finding on whether the exported goods were confiscable. The absence of mis-declaration before the Customs authorities regarding the goods' actual contents further weakened the case for penalty imposition. Notably, mis-declaration before the Zonal Advance Licensing Committee falls under the Foreign Trade Regulations Act, not the Customs Act. Citing a precedent (Fitwell Exports Pvt. Ltd. v. Commissioner of Customs, New Delhi), the Tribunal emphasized that the presence of components in export documents is not mandatory for later benefit claims. Customs authorities should notify licensing bodies or log DEEC Books if suspicions arise, rather than imposing penalties under Section 114 without Customs Act violations related to export goods. Additionally, the imposition of separate penalties on M/s. Stonemann and its partner was deemed inappropriate. Consequently, the Tribunal set aside the penalties imposed on the appellants, emphasizing the lack of grounds for penalty imposition under Section 114 of the Customs Act concerning the export goods. All three appeals were allowed, overturning the Commissioner's order on penalty imposition.
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