2018 (6) TMI 345 - AT - Customs

Penalty on registered courier u/s 112 and 114AA of CA 1962 - misdeclaration of value and description of import goods - Import of two projectors - Held that - The impugned order has not rendered a finding on either or both of these counts. In the absence of such a finding, reference to the provisions of governing regulations is not an adequate substitute - Mere handling in the course of professional engagement does not necessarily imply prior knowledge of liability of the goods to confiscation. That requires an independent and specific finding which is conspicuously absent in the impugned order. The SCN is also bereft of any evidence or suggestion of awareness that the goods under import are liable for confiscation. Consequently, the proceedings lack the rigor that are necessary for imposition of penalties under the sections. Penalties set aside - appeal disposed off.

Summary

Issues:
Import under-declared, fictitious consignee, penalties under Customs Act, 1962, rejection of appeal, liability of courier, failure to conform to regulations, sections 112 and 114AA invoked, absence of specific findings, lack of evidence in show cause notice.

Analysis:
The case involved the import of two projectors with under-declared value and a fictitious consignee by M/s Lord Enterprises, leading to penalties imposed under sections 112 and 114AA of the Customs Act, 1962 against M/s UPS Jet Express Pvt Ltd, the registered courier involved in handling the consignment. The Commissioner of Customs (Appeals), Mumbai – III rejected the appeal against these penalties, prompting the present proceedings.

The original authority and the first appellate authority found the appellant liable for penalties due to non-compliance with the Courier Imports and Exports (Clearance) Regulations, 1998, which bind registered couriers. However, the invocation of sections 112 and 114AA requires a connection with goods liable for confiscation and complicity in filing false declarations, respectively. The impugned order failed to provide specific findings on these crucial aspects, rendering the reference to governing regulations insufficient. Mere handling of import goods by a registered courier does not automatically imply prior knowledge of confiscation liability, necessitating an independent and explicit determination, which was notably absent in the impugned order.

Moreover, the show cause notice lacked evidence or indication of the courier's awareness regarding the goods' confiscation liability, indicating a deficiency in the proceedings necessary for imposing penalties under the relevant sections. Consequently, the Tribunal modified the impugned order by overturning the penalties imposed on M/s UPS Jet Express Pvt Ltd, highlighting the insufficiency of evidence and findings in the case.

In conclusion, the judgment emphasized the importance of specific findings and evidence in cases involving penalties under the Customs Act, 1962, particularly concerning the liability of registered couriers in import-related violations. The decision underscored the necessity for a rigorous assessment of facts and awareness of liability before imposing penalties, ensuring a fair and just application of the law.