2023 (5) TMI 259 - AT - Customs

Levy of penalty u/s 112(a) of the Customs Act on the Customs Broker/appellant - import of Calcium Nitrate with Boron and Nitro Phosphate with Potash through New Mangalore Port by claiming concessional rate of BCD in terms of Notification No.12/2012-Cus dt. 17/03/2012 - denial of benefit of notification - whether appellant had any role whatsoever in claiming exemption notification by the importer on the basis of the certificate and fair interpretation of the notification? - HELD THAT - The issue relates to claiming exemption Notification No.12/2012-Cus on the import of fertiliser by the importer M/s. Yara Fertilisers India Pvt. Ltd., on the basis of chemical test report furnished at the time of assessment of the Bill of Entry. Later, on further analysis of the sample by the Department, different composition of the goods was found which resulted in denying the benefit of the said notification. In these circumstances, there are no ground to impose penalty on the Customs Broker who has no knowledge about the outcome of the said chemical analysis conducted by the Department. In similar circumstances involving the same parties pertaining to different Bill of Entry, the learned Commissioner(Appeals) by a detailed order even though confirmed the demand of differential duty, set aside the penalty against the Customs Broker - there are no merit in the impugned order imposing penalty on the Customs Broker for advancing the claim of inapplicable notification by the importer - appeal allowed.

Summary

Issues involved:
The issue involved in this case is whether the penalty imposed under Section 112(a) of the Customs Act on the Customs Broker/appellant is sustainable.

Summary:

Issue 1: Claiming exemption under Notification No.12/2012-Cus:
The case involved an appeal against the Order-in-Appeal passed by the Commissioner of Customs(Appeals), Bangalore. The appellants, acting as Customs Brokers for an importer, filed for concessional rate of BCD under Notification No.12/2012-Cus. However, it was later discovered that the importers were not eligible for the benefit of the notification, leading to proceedings for recovery of differential duty, interest, and penalty. The adjudicating authority confirmed the demand against the importer and imposed penalties, including on the Customs Broker. The appellant argued that they simply filed the bill of entry based on the importer's disclosure and chemical analysis certificate, and should not be penalized for the importer's misinterpretation of the notification. The Tribunal found that the penalty on the Customs Broker was unwarranted as they had no knowledge of the incorrect chemical analysis conducted by the Department. The Tribunal noted that in similar cases involving the same parties, penalties against the Customs Broker were set aside, leading to the decision to allow the appeal and set aside the penalty imposed on the Customs Broker.

This summary provides a detailed overview of the legal judgment, addressing the issues involved and the Tribunal's decision regarding the penalty imposed on the Customs Broker under the Customs Act.