2024 (12) TMI 101 - HC - Customs

Correctness of CESTAT's order setting aside the order of confiscation and imposition of redemption fines under the Customs Act, 1962 - HELD THAT -Under Section 130 of the Customs Act, 1962, appeals can be entertained only if they involve substantial questions of law. Mr Sharma's contentions are factual issues that the tribunal has considered in considerable detail. In particular, the discussion clarifies this position. Therefore, these appeals, which attack pure findings of fact, may not be required to be admitted. There are no significant differences in the factual aspects of the present appeals and the appeal in the case of Ganesh Benzoplast Limited 2024 (10) TMI 990 - BOMBAY HIGH COURT Even in these appeals, the respondents import goods discharged through high-pressure pipelines from the vessel directly into tanks in the gated complex in the port area. After obtaining the necessary permissions from the authorities, some of the material may have been stored in non-bonded tanks but within the same gated complex. This was done after obtaining permission. The appeals do not raise any substantial questions of law, including the ones proposed by Mr Sharma. Observations in BISCO Limited (supra) also deal with a similar situation, and Dr Kantawala is right to submit that the decisions in Ganesh Benzoplast Limited 2024 (10) TMI 990 - BOMBAY HIGH COURT and BISCO Limited 2024 (3) TMI 1001 - SUPREME COURT support the respondent s case. Tribunal was entirely justified in relying on Finesse Creation Inc. 2009 (8) TMI 115 - BOMBAY HIGH COURT which is the decision of the Division Bench of this Court, instead of relying on the decisions of the Gujarat and Madras High Court. In these matters, it was the Bombay High Court, which was the jurisdictional High Court, and therefore, there was no question of the Tribunal relying upon the judgments of the other High Courts, which Mr Sharma now seeks to rely upon. The Hon ble Supreme Court rejected the SLP against the Bombay decision. In any event, even these contentions are based upon the decisions of the Gujarat and Madras High Courts, were considered and rejected by us in the case of Ganesh Benzoplast Limited 2024 (10) TMI 990 - BOMBAY HIGH COURT Commissioner has imposed penalties by invoking the residual provision of Section 117 of the Customs Act, 1962. We disapproved such an approach in the case of Ganesh Benzoplast Limited 2024 (10) TMI 990 - BOMBAY HIGH COURT This Court held that the residual provision of Section 117 of the Customs Act cannot be invoked upon realising that no fines or penalties could be imposed u/s 111 and 112 of the Customs Act,1962. Tribunal also considers the argument about exceeding the value in some instances in detail. The factual finding and the reasoning suffer from no perversity to warrant interference in appeals that must be considered only if they involve substantial questions of law. Therefore, we are satisfied that none of the substantial questions of law as proposed by Mr Sharma or even otherwise arise in both these appeals.

Summary

Issues:
Challenging CESTAT's order dated 28 June 2024 on multiple grounds.

Analysis:
The appellant raised substantial questions of law regarding the correctness of CESTAT's decision to set aside the order of confiscation and imposition of redemption fines under the Customs Act, 1962. The questions included issues related to the location of bonded tanks, estimation of assessable value, and interpretation of regulations. The appellant contended that material stored in a non-bonded warehouse was impermissible, exceeding permitted value. The appellant argued that CESTAT erred in relying on a previous court decision, emphasizing differing views from other High Courts. The respondent, however, argued that no substantial questions of law arose, as the tribunal had thoroughly examined the facts, which were not significantly different from previous cases. The respondent explained the circumstances of storing excess material with necessary permissions and accepted explanations for marginal value increases.

The court noted that under Section 130 of the Customs Act, appeals can only be entertained if substantial questions of law are involved. The court found that the appellant's contentions primarily pertained to factual issues extensively considered by the tribunal, indicating that the appeals challenging factual findings may not be admitted. The court observed similarities between the present appeals and previous cases, emphasizing the storage of goods in non-bonded tanks within the same complex with proper permissions. It was concluded that no substantial questions of law were raised in the appeals, aligning with the decisions in previous cases cited by the respondent.

Furthermore, the court addressed the appellant's reliance on decisions from other High Courts, emphasizing the jurisdiction of the Bombay High Court in the present matter. The court highlighted the rejection of Special Leave Petition (SLP) against the Bombay decision by the Supreme Court and rejected contentions based on judgments from Gujarat and Madras High Courts. The court disapproved the imposition of penalties under Section 117 of the Customs Act, emphasizing the limitations on invoking such provisions when fines or penalties could not be imposed under other relevant sections. The court found no perversity in the factual findings and reasoning to warrant interference, ultimately dismissing the appeals as they did not involve substantial questions of law.

In conclusion, the appeals were dismissed without costs, and the interim applications were also dismissed. The court's decision was based on the lack of substantial legal issues raised in the appeals, consistent with previous judgments and factual considerations made by the tribunal.