9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (6) TMI 321 - AT - CustomsAbsolute Confiscation - Penalty - Smuggled Cigarettes - present and past consignments - aluminum scrap confiscated on the premise that the same had been camouflaged to cover up the smuggled cigarettes - whether the appellant have smuggled cigarettes by concealing in the consignment of aluminum scrap in the case of past consignment or otherwise? - HELD THAT - In respect of all the consignments physical examination of the container was carried out and no discrepancy was found therefore, as per the physical examination of imported aluminum scrap there is no evidence that the cigarettes were concealed under the imported aluminum scrap. The revenue s sole reliance is on email retrieved from the email ID of Shri Bharat Patel. However, even if it is accepted that email was sent to Shri Bharat Patel but on the face of the examination order it is clear that cigarettes were not supplied along with the aluminum scrap in the past consignment. As regard import of Metal Scrap a circular No. 43/2001-Cus dated 06.08.2001 as amended from time to time was issued. In terms of such circular Metal Scraps imported in unshredded should be accompanied by pre shipment inspection certificate. The said consignment is required to be examined by 25% in respect of manufacturer importers and 50% in respect of traders - the custom officer has examined the goods as evident from the examination order and during examination the officers did not find the cigarette concealed under the said scrap. After examination the goods for past imports were allowed clearances for home consumption without any hindrances. This shows that the procedure as required under Section 47 which is mandatory has been complied with. In view of the examination of the goods, it is important to note that examining officers have not been questioned about the manner of examination of the past consignment. If this be so, the examination report cannot be discarded. If at all there is any lapse on the examination officer, some action should have been taken by the department. In this fact in one hand department accepted the examination of goods and on the other hand solely relying on an email held that appellants have smuggled cigarettes concealing under Aluminum scrap in past consignment, which cannot be accepted. In the present case, since the goods were physically examined and Custom officer did not find the cigarettes concealed with the consignment of aluminum scrap. Hence the statements given by the witnesses found to be incorrect. In these circumstances, the documentary evidences i.e. Examination Order will be the prevailing evidence over the statements recorded under Section 108 of the Customs Act. Therefore, as per the facts of the present case, the statements have no evidentiary value therefore, on that basis it cannot be concluded that the appellants have smuggled cigarettes concealed under the past consignment of aluminum scrap. It is further noticed that as regard the past import by M/s. Dwarkesh Recycling there is no reference made in the email retrieved from email ID of Shri Bharat Patel. Therefore, in any case in respect of past import made by M/s. Dwarkesh Recycling it cannot be disputed particularly on the basis of email. The identical issue has been considered by the Hon ble Andhra Pradesh High Court in the case of SYED IRFAN MOHAMMED AND ANOTHER PETITIONERS VERSUS THE UNION OF INDIA, REP. BY ITS SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE 2017 (2) TMI 961 - ANDHRA PRADESH HIGH COURT wherein on the basis of the live consignment in respect of past consignment also demand of duty and penalty was made. In the live consignment. Custom Authority found cigarettes and on the basis of the Modus-Operandi in respect of live consignment the demands were raised on the premise that similar Modus-operandi was adopted in the past consignment. The Hon ble High Court held that when the goods were examined by the Custom officer and did not find any mis-declaration it cannot be held that what was found in the live container was carried out in the past container specifically when all the statutory formalities were carried and goods were cleared for home consumption. There is no dispute that the cigarettes were found concealed under the consignment of aluminum scrap therefore, the goods are liable for confiscation. For the purpose of confiscation of goods mens rea is not required. There is clearly a misdeclaration as per the physical examination of the goods, therefore, we agree with the Adjudicating Authority that the cigarettes concealed with aluminum scrap were rightly confiscated absolutely - The penalty was also imposed towards confiscation of aluminum scrap for which there was no fault of the appellant as there was no mis-declaration. As regard the aluminum scrap the import documents are also for import of aluminum scrap therefore, penalty with respect to aluminum scrap should not have been imposed. Penalty u/s 114AA and 112a of CA - HELD THAT - The penalty under Section 114AA was imposed upon M/s. Shivanjali Corporation and Shri Bharat Patel is relating to past consignments and as we held that in the past consignment there is no case of smuggling of cigarettes, the penalty under Section 114 AA will not sustain - Keeping in view the smuggling of cigarettes in the past as well as live consignment since the demand of past consignment was set aside and in the live consignment the penalty was imposed under section 114A as well as Section 112a(i) there should not be further penalty under Section 114AA. Appeal allowed in part.
Issues Involved:
1. Confiscation and penalties related to "Gudang Garam" branded cigarettes concealed in aluminum scrap. 2. Demand of customs duty and penalties on past consignments based on email evidence and statements. 3. Admissibility and evidentiary value of electronic evidence (emails) and statements. 4. Examination and clearance procedures for imported aluminum scrap. 5. Imposition of penalties under various sections of the Customs Act, 1962. Issue-wise Detailed Analysis: 1. Confiscation and Penalties on Live Consignment: The Customs Authority found 13,68,000 sticks of "Gudang Garam" branded cigarettes concealed in aluminum scrap imported by M/s. Dwarkesh Recycling under Bill of Entry No. 7720230 dated 06.12.2016. The cigarettes were absolutely confiscated under Sections 111(d), 111(f), and 111(l) of the Customs Act, 1962. The aluminum scrap used to camouflage the cigarettes was also confiscated under Sections 111(m) and 119. The appellant was given an option to redeem the aluminum scrap on payment of a reduced redemption fine of ?5 Lacs instead of ?20 Lacs. Additionally, penalties under Section 112(a)(i) were reduced from ?25 Lacs to ?10 Lacs, while the penalty under Section 112(a)(ii) was set aside. 2. Demand of Customs Duty and Penalties on Past Consignments: The respondent demanded customs duty and imposed penalties on past consignments of cigarettes allegedly smuggled by M/s. Dwarkesh Recycling and M/s. Shivanjali Corporation. This was based on an email dated 15.08.2016 from HKM Trading Co. retrieved from the email ID of Shri Bharat Patel and inculpatory statements from various individuals. However, the Tribunal found that all past consignments were physically examined by customs officers, and no discrepancies were found. The examination orders, which are documentary evidence, prevailed over the oral statements. Therefore, the demand of duty and penalties for past consignments was set aside. 3. Admissibility and Evidentiary Value of Electronic Evidence and Statements: The Tribunal addressed the admissibility of email evidence under Section 138C(2) of the Customs Act and Section 65(B) of the Evidence Act, 1872. It was argued that the email prints were not admissible without a proper certificate. The Tribunal cited the judgment in S.N. Agrotech Vs Commissioner of Customs and emphasized that statements recorded under Section 108 of the Customs Act must be examined and cross-examined under Section 138B for evidentiary value. Since the statements were not examined as required, they were deemed to have no evidentiary value. 4. Examination and Clearance Procedures for Imported Aluminum Scrap: The Tribunal noted that the imported aluminum scrap was accompanied by a Pre-Shipment Inspection Certificate (PSIC) and was examined as per Circular No. 43/2001-Cus dated 06.08.2001. The customs officers physically examined the consignments, and no mis-declaration was found. The Tribunal held that the clearance procedures under Section 47 of the Customs Act were followed, and the past consignments were lawfully cleared for home consumption. 5. Imposition of Penalties under Various Sections of the Customs Act: The Tribunal addressed penalties imposed under Sections 112(a), 114A, 114AA, and 117 of the Customs Act. It was held that penalties under Section 114AA were not sustainable for past consignments as there was no evidence of smuggling. Penalties under Section 117 for non-honoring summons were also set aside, as the appellants had already been penalized under IPC in the ACMM Court. The Tribunal reduced the penalties imposed on the live consignment and set aside penalties related to past consignments and certain individuals. Conclusion: 1. Absolute confiscation of 13,68,000 sticks of "Gudang Garam" cigarettes upheld. 2. Confiscation of 28,340 Kgs of aluminum scrap upheld with reduced redemption fine. 3. Penalties on past consignments set aside due to lack of evidence. 4. Statements and electronic evidence deemed inadmissible without proper examination and certification. 5. Penalties under Sections 114AA and 117 set aside for specific individuals. Orders: 1. Appeal No. C/11723/2018 partly allowed with reduced penalties and consequential relief. 2. Appeal Nos. C/11724/2018, C/12355/2018, and C/12447/2018 allowed with consequential relief. Pronouncement: The judgment was dictated and pronounced in open court on 12.6.2020.
|
