2018 (8) TMI 112 - HC - Customs

Quantum of penalty - Forgery of large number of documents - Clearance of goods on the basis of false documents - Whether given the concurrent findings and the circumstances established, the imposition of a higher penalty on the appellant was justified? Held that - This Court is of the opinion that the imposition of different amounts as penalties upon the appellant on the one hand and the other two employees on the other, in the peculiar facts of this case, does not appear to be justified - Although the Revenue s counsel sought to justify this difference by emphasising upon the nature of the role, what appears from the record is that the lower authorities were carried away by the fact that the appellant was a Manager whereas, the other two were lesser ranked employees. The penalty imposed upon the appellant of ₹ 20 lacs each under Section 112 and 114AA of the Customs Act, is hereby reduced to ₹ 6 lacs under each provision - Appeal allowed in part.

Summary

Issues:
1. Condonation of delay in re-filing the appeal.
2. Exemption application.
3. Justification of a higher penalty imposed on the appellant compared to other employees.

Condonation of Delay:
The delay of 67 days in re-filing the appeal was condoned by the High Court for reasons mentioned in the application. The application for condonation of delay was disposed of, allowing the appeal to proceed.

Exemption Application:
The exemption application was allowed subject to all just exceptions, enabling the appellant to move forward with the legal proceedings.

Imposition of Higher Penalty:
The main issue in this case was whether the imposition of a higher penalty on the appellant was justified compared to two other employees involved in the forgery. The Commissioner found that the appellant, along with other employees, was part of a conspiracy to forge WPC Import licenses. The Commissioner ordered confiscation of goods and imposed penalties on various parties, including the appellant. The appellant argued that the penalties were arbitrary and unreasonable, as the roles of the employees were not differentiated. The Revenue contended that the appellant was responsible for more forgeries compared to the other employees. The High Court found that the differentiation in penalties was not justified, as the appellant's role was not significantly different from the other employees. Therefore, the penalty imposed on the appellant was reduced from Rs. 20 lacs to Rs. 6 lacs under each relevant provision. The appeal partly succeeded on this ground, and the appellant was directed to deposit the reduced penalty amount within four weeks.

This detailed analysis of the judgment covers the issues of condonation of delay, exemption application, and the justification of the penalty imposed on the appellant, providing a comprehensive overview of the legal proceedings and the High Court's decision.