2014 (4) TMI 584 - AT - Customs

Confiscation of foreign currency - Attempt to smuggle - Held that - Foreign currency equivalent to Rs. 1.25 crore seized on 08/01/2006 is with the department and thus, interest of the Revenue is secured and also taking note of the decision of the hon ble apex Court in the case of Bhavya Apparels Pvt. Ltd. (2007 (9) TMI 274 - SUPREME COURT OF INDIA), we are of the considered view that the appellants have made out a prima facie case for grant of stay. Accordingly, we grant unconditional waiver from pre-deposit of the penalties adjudged against the appellants and stay recovery thereof during the pendency of the appeals - Decided in favour of assessee.

Summary

Issues:
- Confiscation of foreign currency under Customs Act and FEMA
- Imposition of penalties on individuals involved in smuggling
- Appeal against Order-in-Original
- Grant of stay against penalties pending appeal
- Early hearing of the appeal

Confiscation of Foreign Currency:
The judgment pertains to an appeal against an Order-in-Original where foreign currency amounting to Rs. 1,25,22,780 was confiscated under Sections 113(d) and 113(h) of the Customs Act, 1962 read with FEMA, 1999. The adjudicating authority did not provide an option for redemption of the currency and imposed penalties on the individuals involved in the smuggling attempt. The appellants challenged this decision before the Tribunal.

Imposition of Penalties:
The Commissioner imposed a penalty of Rs. 50 lakhs on one individual and penalties of Rs. 1.25 crore and Rs. 25 lakhs on two other individuals for their roles in the smuggling of foreign currency. The appellants contested these penalties, seeking a stay against their enforcement pending the appeal process.

Appeal Against Order-in-Original:
The appellants had previously approached the Tribunal, which remanded the matter back to the adjudicating authority for a fresh decision considering all arguments raised. The current appeal challenges the confiscation of currency and imposition of penalties without the option for redemption.

Grant of Stay Against Penalties:
The counsel for the appellants argued that since the seized currency was still with the department after more than 8 years, the penalties should be stayed. Citing a Supreme Court decision, the counsel contended that Section 129E of the Customs Act, which deals with pre-deposit, would not apply in this situation. The Tribunal agreed, granting an unconditional waiver from pre-deposit of the penalties and staying their recovery during the appeal process.

Early Hearing of the Appeal:
The Revenue requested an early hearing of the appeal, which was allowed by the Tribunal. Considering the value of the seized currency and following the decision in a previous case, the Tribunal directed the Registry to list the appeals for final hearing on a specific date.

This judgment addresses the confiscation of foreign currency, imposition of penalties, appeal against the Order-in-Original, grant of stay against penalties, and scheduling an early hearing for the appeal before the Appellate Tribunal CESTAT MUMBAI.