2019 (1) TMI 782 - AT - Customs

Quantum of penalty imposed under Section 114A of the Customs Act, 1962 - Section 28 and 28A of the Customs Act, 1962 - Held that - The issue involved is no longer res-integra and this tribunal has constantly taken the view the penalty imposed under Section 114A will be equivalent duty demanded under Section 28 or interest demanded under Section 28AA - appeal dismissed - decided against Revenue.

Summary

Issues:
Challenge to quantum of penalty under Section 114A of Customs Act, 1962.

Analysis:
The appeal filed by the revenue challenges the penalty imposed under Section 114A of the Customs Act, 1962, arguing that the penalty should have been equivalent to the total duty and interest demanded under Sections 28 and 28A, respectively. The Commissioner had imposed a penalty equivalent to the duty demanded, leading to the dispute.

During the hearing, the Assistant Commissioner for the revenue reiterated the grounds taken in the appeal, while no representation was made for the respondent.

The central issue revolved around the interpretation of Section 114A of the Customs Act, 1962. The Tribunal noted that it has consistently held that the penalty under Section 114A should be equivalent to the duty demanded under Section 28 or the interest demanded under Section 28AA. This interpretation was supported by legal precedents, including the case of Commissioner of Central Excise & Service Tax Bangalore 1 vs B. SURESH VASUDEV BALIGA, where the Tribunal rejected the revenue's appeal and upheld the penalty equivalent to the duty or interest determined.

Furthermore, the Tribunal referred to the case of Bharti Airtel, where it was established that the penalty under Section 114A should be equal to the duty or interest determined. The Tribunal highlighted that the duty demand should not exceed the amount specified in the show-cause notices, and the interest payable depends on the actual date of payment of the determined duty. The Tribunal emphasized that the penalty is imposed on the person liable to pay duty or interest as determined under Section 28.

Ultimately, the Tribunal found no merit in the revenue's appeal and dismissed it, upholding the penalty imposed by the Commissioner. The decision was pronounced in court on 15.01.2019.