9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2025 (3) TMI 441 - AT - CustomsInterpretation of Section 114A of the Customs Act 1962 - whether the amount of penalty under this section should be equal to the sum of custom duty and interest on this duty? - short payment of Customs Duty - HELD THAT - The issue in the present appeal is squarely covered by the decision of this Tribunal in the case of M/s Khanna Traders Engineers 2024 (11) TMI 1433 - CESTAT ALLAHABAD . There are no merits in the appeal filed by the revenue to the extent that interest amount should have been added to the duty short paid while imposition of penalty under Section 114A of the Act. Tribunal and even High Court has repeatedly emphasized that the word used in the section is or and not and . In case of Sony sales Corporation 2021 (3) TMI 174 - KARNATAKA HIGH COURT Hon ble Karnataka high Court has held that From perusal of the relevant extract of Section 114A it is evident that the language employed by the Legislature is plain and unambiguous and the provision contains a positive condition with regard to levy of penalty equal to duty or interest and does not contain any negative condition. Conclusion - The penalty should be equal to the duty or interest as determined and the word or in the provision cannot be interpreted as and. There are no merits in the appeal filed by the revenue - Appeal filed by the revenue is dismissed.
The appeal before the Appellate Tribunal concerned the interpretation of Section 114A of the Customs Act, 1962, in the context of a dispute regarding the recovery of customs duty and penalty from M/s Titra Trading Pvt. Ltd. The core legal questions considered in the judgment were the applicability of penalty under Section 114A and the interpretation of the word "or" in the provision.The Tribunal analyzed the impugned order issued by the Commissioner of Customs, Noida, which directed the recovery of customs duty amounting to Rs. 3,68,86,757 from the appellant, along with applicable interest and penalty under the Customs Act, 1962. The respondent had self-assessed the duty for imported goods under a free trade agreement but was later found ineligible for the benefit, resulting in a short payment of duty.The Tribunal examined the arguments presented by the revenue, which contended that the penalty under Section 114A should be equal to the sum of customs duty and interest. However, the Tribunal referenced a previous decision in the case of M/s Khanna Traders & Engineers Customs Appeal, where it was established that the word "or" in the provision should be interpreted as disjunctive, not conjunctive.Citing the decision of the Hon'ble Karnataka High Court in the case of Sony Sales Corporation, the Tribunal emphasized that the legislative intent behind the use of "or" in statutory interpretation should not be altered unless required by the context. The Tribunal clarified that Section 114A imposes a positive condition for the levy of penalty equal to the duty or interest determined, without any negative condition.In light of the clear and unambiguous language of Section 114A, the Tribunal dismissed the revenue's appeal, concluding that the penalty should be equal to the duty or interest as determined, and the word "or" in the provision cannot be interpreted as "and." The Tribunal also noted that the clarification issued by the Central Board of Excise and Customs in 2002 did not contradict the plain language of the provision.Ultimately, the Tribunal upheld the impugned order and dismissed the appeal filed by the revenue. The judgment established the principle that the penalty under Section 114A of the Customs Act is to be determined based on the duty or interest amount, as specified in the provision, without combining both elements.
|
