2019 (8) TMI 690 - AT - Customs

Confiscation - redemption fine - penalty - smuggling - action against the buyer of goods instead of the importer - Micro SD Cards - HELD THAT - It is an admitted fact that these are goods purchased from Delhi by duly VAT paid bills through Tax Invoice Nos 152, 153, 154 for the entire quantity of 10,800 pieces of Micro SD Cards from the supplier M/s Deepak International, Hardhyan Singh Road, Delhi. It is also an admitted fact that Ledger and Bank Statement of the Appellant shows that he paid the Supplier M/s Deepak International, an amount of ₹ 20,40,000/- by two Cheques from his Bank Account. It is also an admitted fact that there was wide discrepancy in the Inventory List prepared by the Customs officers and findings of Joint Inspection where the Appellant also participated. There is force in the contention of the Ld. Counsel for the Appellant that if Revenue had doubt about these goods being smuggled, they should have taken some action against the supplier but no such action was taken - also there is force in the contention of Ld. Counsel for the Appellant that these goods are not notified and do not fall under the ambit of Section 123, but even then the Department has sought to shift the onus on the Appellant to prove that the goods are legally imported by not taking any action against the supplier. The confiscation, redemption fine and demand of duty is therefore set aside - appeal allowed.

Summary

Issues:
Confiscation and imposition of redemption fine on Micro SD Cards upheld by Order-in-Appeal.

Analysis:
The case involved the interception of a consignment of Micro SD cards by Customs Officers, leading to a Show Cause Notice for confiscation and penalty under the Customs Act. The Appellant argued that the goods were domestically purchased with VAT paid, and there was no proof of illegal importation. The Appellant contended that discrepancies in the inspection reports raised doubts about the origin of the goods and suggested the possibility of tampering. The Appellant also highlighted the Department's failure to take action against the supplier or importer, shifting the burden of proof. The issue of additional Customs Duty was raised, citing relevant notifications and judicial precedents.

The Tribunal considered the evidence and arguments presented. It noted the payment records and discrepancies in inspection reports, questioning the Department's failure to act against the supplier. The Tribunal agreed with the Appellant's position that the goods were not notified under the Customs Act, and the onus of proving illegal importation rested with the Department. The Tribunal also analyzed the applicability of Customs Duty exemptions and referenced relevant circulars and court decisions. Ultimately, the Tribunal set aside the confiscation, redemption fine, and duty demand, granting relief to the Appellant based on the lack of conclusive evidence and legal considerations.

In conclusion, the Tribunal allowed the appeal, emphasizing the lack of concrete proof of illegal importation and the Department's failure to address key discrepancies. The decision highlighted the importance of proper evidence and adherence to legal requirements in cases of confiscation and penalty under the Customs Act.