2012 (10) TMI 699 - AT - Customs

CHA import of goods misdeclaration alleged that goods were actually MPEG cards and that the ores described in the Bill of Entry - case of the Revenue is based on the statement of Shri Biswajit Bhowmick. Shri Arsh Kumar who imported the goods in the name of M/s. Shiv Shakti Enterprises was not asked whether CHA firm or Shri Biswajit Bhowmick were aware of the fact that what was being imported was MPEG card or not and whether he had given them any specific instructions to ensure that the goods are improperly declared and cleared without any problem by the Customs. All questions put to Shri Arsh Kumar related to importation, documentation, repatriation of moneys, etc - CHA firm submitted that the Director of CHA relied upon that the CHA firm had only done the work of clearing of goods and neither he nor his employee was aware of the fact that what was being imported was MPEG card Held that - Statement has been improved as submitted but in the absence of any corroboration by the importer himself or any facts and circumstances of the case which are needed to reach such conclusion - no case has been made out against the appellants by the Revenue order set aside

Summary

Issues:
Penalties imposed under Section 112(a) of the Customs Act, 1962 on CHA firm and an employee for abetting importation and misdeclaration of goods.

Analysis:
The case involved penalties imposed on a CHA firm and an employee for their alleged involvement in the importation and misdeclaration of goods. The Revenue's case relied heavily on the statement of the employee, Shri Biswajit Bhowmick, as the basis for the penalties. However, it was noted that the real importer, Shri Arsh Kumar, was not questioned about whether the CHA firm or the employee were aware of the misdeclaration. The Director of the CHA firm did not participate in the investigation, and the employee's statements differed between the initial statement and a subsequent one made four months later. The main issue was whether penalties could be imposed based solely on the employee's second statement. The employee initially claimed ignorance of the misdeclaration but later admitted awareness. The appellants argued that penalties should not be imposed without evidence of extra benefits derived or corroboration from the importer. Legal precedents were cited to support the argument that an improved statement made later should not be relied upon without corroboration. Ultimately, the Tribunal found that the Revenue failed to establish a case against the appellants. The appeals were allowed, the impugned order was set aside, and the penalties against both appellants were also set aside. The Tribunal noted that detailed submissions were made by both sides, leading to the disposal of the appeals and stay petitions.

This detailed analysis of the judgment highlights the key issues, arguments presented, and the ultimate decision reached by the Tribunal regarding the penalties imposed on the CHA firm and the employee for their alleged involvement in the importation and misdeclaration of goods.