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Issues:
- Imposition of personal penalty under Section 114 of the Customs Act, 1962 on the appellant company for discrepancies in exported goods. Analysis: The judgment by the Appellate Tribunal CEGAT, CALCUTTA involved an appeal against the imposition of a personal penalty of Rs. 1.00 lakh on the appellant company, M/s. T.I.S.C.O., by the Additional Commissioner of Customs for Export, Custom House, Calcutta under Section 114 of the Customs Act, 1962. The case revolved around discrepancies found in the exported goods, specifically 23 pallets of Hexagonal Nuts intended for export to Australia in August 1991. The goods were manufactured by a Conversion Agent, M/s. Shree Krishna Pvt. Ltd., Howrah, using raw materials supplied by the appellants. After discrepancies were noticed during examination at the Export Transit Yard, the appellants requested to cancel the Shipping Bill and withdraw the consignment. The adjudication proceedings revealed that the appellants admitted to discrepancies but attributed them to negligence on the part of the Conversion Agent and the Commissioning Agency appointed by them. The Additional Commissioner of Customs imposed the penalty based on these discrepancies. During the appeal, the appellant's representative argued that while acknowledging the discrepancies, there was no malicious intent on the part of the appellant company. They accepted vicarious liability for the negligence of the Conversion Agent and the Commissioning Agency. The appellant's representative highlighted that the adjudicating authority's mention of collusion or connivance was based on conjecture as there was no confirmed finding of such actions. The appellant's immediate offer to withdraw the export upon discovering the discrepancies was also emphasized. On the other hand, the respondent Commissioner's representative supported the penalty imposition, citing significant discrepancies in the exported goods. In the judgment, the Tribunal considered both parties' submissions and acknowledged the discrepancies between the exported goods and the appellant's declarations. While no direct connivance was proven, the Tribunal held the appellants liable due to negligence. The Tribunal noted that the penalty of Rs. 1.00 lakh was excessive and reduced it to Rs. 10,000, emphasizing that the discrepancies were a result of negligence rather than proven collusion or connivance. The appeal was allowed with the revised penalty amount.
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