2015 (10) TMI 29 - AT - Customs

Export goods improperly Use of false and incorrect material Confiscation and imposition of penalty Appellant was implicated for payment of penalty, for attempting export of goods by mis-declaration, only on statement made by one Pradeep Dhond As per his statement appellant has supplied lead acetate to him which was attempted to be exported by using IEC of some other firm Held that - It was clear from investigation and records that Pradeep was exporter of mis-declared goods Role of appellant was that he has supplied Lead Acetate to him but said goods were delivered in domestic area and not in Customs area After appellant sold goods to Pradeep, appellant thereafter was not concerned with said goods Section 114(i) can be imposed on person whose act renders goods liable for confiscation Movement of goods outside Customs area cannot be liable to confiscation Therefore, even if it was accepted that appellant supplied goods but at place outside Customs area, said goods was not liable to confiscation Hence, penalty upon Appellant was not sustainable Since role of appellant was only to supply goods in domestic area, therefore no penalty should have been imposed upon appellant either under Section 114(i) or under Section 114AA Thus, penalties imposed upon the appellant are unsustainable Decided in favour of Appellant.

Summary

Issues:
1. Imposition of penalties under Sections 114(i) and 114AA of the Customs Act, 1962 based on mis-declaration of goods.
2. Role of the appellant in supplying goods and penalties imposed on him.
3. Legal validity of penalties imposed on the appellant.

Analysis:

Issue 1: The appellant appealed against the penalties imposed under Sections 114(i) and 114AA of the Customs Act, 1962 based on mis-declaration of goods. The penalties were imposed by the Commissioner of Customs (Adjudication) on the appellant and another individual for their involvement in the export of mis-declared goods, including Norphedrine, Ethyl Amphetamine, Phenyl Propanolamine, and Amphetaminil. The appellant contested the penalties, which were part of the order-in-original CAO No. 13/2012/CAC/CC/BKS.

Issue 2: The appellant's role in the case was analyzed by the Tribunal. It was found that the appellant had supplied Lead Acetate to the exporter of mis-declared goods, Shri Pradeep Dhond. However, the goods were delivered in the domestic area and not in the Customs area. The Tribunal noted that the penalties imposed on the appellant were under Sections 114(i) and 114AA, which pertain to acts or omissions rendering goods liable to confiscation and the use of false or incorrect material, respectively. The Tribunal concluded that since the goods were supplied outside the Customs area, they were not liable for confiscation, and thus, the penalties on the appellant were not sustainable.

Issue 3: The Tribunal further examined the legal validity of the penalties imposed on the appellant. It was observed that the investigation did not find any document prepared or signed by the appellant relevant to the export of goods. The Tribunal referenced a previous order regarding a related case involving Shri Pradeep Dhond, where confiscation of goods found outside the Customs area was dropped. Based on this precedent and the lack of direct involvement of the appellant in the export of goods, the Tribunal held that the penalties imposed on the appellant were unsustainable. The Tribunal emphasized the importance of corroborative evidence and due process in penalizing individuals based on statements of others without proper verification.

In conclusion, the Tribunal allowed the appeal filed by the appellant, setting aside the penalties imposed on him under Sections 114(i) and 114AA of the Customs Act, 1962.