2001 (3) TMI 491 - AT - Customs

Summary

Issues:
1. Mis-declaration in shipping bill of galvanised pipes and tubes.
2. Attempting to export improperly under the cover of shipping bill.
3. Liability for penalty under various sections of Customs Act and Foreign Exchange Regulation Act.
4. Allegations against Siddhartha Tubes Ltd., Steel Tubes of India Ltd., and Hari & Co.
5. Imposition of penalty under Section 114(i) of the Customs Act.
6. Scope of penalty imposition and considerations for penalty reduction.
7. Allegations against CHA agent and imposition of penalty.
8. Compliance with show cause notice requirements for penalty imposition.

Detailed Analysis:
1. The judgment involves three appeals arising from a common Order-in-Original, where mis-declaration in the shipping bill of galvanised pipes and tubes was upheld. The Commissioner of Customs found the goods liable for confiscation under various sections of the Customs Act and Foreign Exchange Regulation Act due to mis-declaration. As the goods were not available for confiscation, penalties were imposed on the appellants.

2. The allegations against Siddhartha Tubes Ltd., Steel Tubes of India Ltd., and Hari & Co. included mis-declaration and attempting improper export under the cover of a shipping bill. Penalties were imposed under Section 114(i) of the Customs Act, with further actions ordered against Hari & Co. under CHA Licensing Regulation, 1984.

3. Arguments were presented by the counsels representing the appellants, highlighting discrepancies in the weight declaration and the lack of intent to evade duty. The appellants contended that errors were unintentional and did not aim to gain unlawfully. They also emphasized the minimal duty-free benefit and requested leniency in penalty imposition.

4. The legal representatives referenced previous judgments to support their arguments, focusing on the settled issue of penalty imposition for mis-declaration. The appellants' counsels highlighted the lack of substantial gain from the mis-declaration and the absence of quality-related allegations.

5. The Tribunal considered the arguments and previous judgments, affirming the mis-declaration charges. However, a reduction in penalties was deemed appropriate based on the circumstances, duty benefits, and the parties' losses. The penalty on Siddhartha Tubes Ltd. was reduced to Rs. 5,00,000, on Steel Tubes of India Ltd. to Rs. 2,00,000, and the penalty on Hari & Co. was set aside due to the absence of specific penalty allegations in the show cause notice.

6. The judgment emphasized the importance of adhering to the allegations in the show cause notice for penalty imposition. The Tribunal concluded that while mis-declaration was established, penalties needed adjustment based on the duty benefits and the parties' financial losses, leading to the modification of the original order for penalty reduction and setting aside penalties where required.