2023 (8) TMI 423 - AT - Customs

Maintainability of appeal - failure to make pre-deposit of duty amount in terms of section 129E of the Customs Act, 1962 - liability to pay the duty amount and penalty, fastened by the adjudicating authority 'jointly and severally' on eight noticees can be divided into individual liability for the purpose of making the pre-deposit or not - HELD THAT - It is found from the impugned order that the learned Commissioner has fixed the liability towards customs duty and the penalty under Section 114A of the Customs Act jointly and severally, which in simple and plain words imply that the liability to pay the duty and penalty is imposed on all the noticees jointly and in the event anyone of the noticees chooses to avail the remedy of appeal he has to comply with the condition imposed under Section 129E of the Customs Act. The duty to be paid cannot be bifurcated or apportioned on individual basis, for the simple reason that the learned Commissioner was conscious of the factual position and has consciously levied the liability as jointly and severally. From the impugned conclusion, it can be seen that the Commissioner while imposing penalty under section 114AA of the Customs Act has imposed the same individually on each of the parties in the tabulated form. In imposing the liability jointly and severally the intention is manifest that all the parties are equally responsible for paying the full duty and penalty. In the event anyone of them fails to pay off, the others become responsible for the share of that person. The ultimate intention in holding the parties jointly and severally liable is to protect the interest of the Revenue, particularly in view of the peculiar facts. If the appellant wants to avail the remedy of filing the statutory appeal, it is mandatory to comply with the conditions specified under Section 129E of the Customs Act, i.e. to make pre-deposit of 7.5% of the duty and penalty in dispute. It is a settled principle of law as held in catena of decisions, a right of appeal is a statutory right and if the party wants to avail the remedy by way of appeal under the statute, it is incumbent upon him to comply with the conditions specified therein. The appellant cannot take shelter that the pre-deposit amount should be calculated on the basis of his individual liability to pay the duty and penalty under the impugned order. The concept of joint and several liability extends to the payment of entire duty and penalty amount on all the parties. The appellant is directed to make the pre-deposit in terms of Section 129E of the Customs Act, within six weeks from the date of this order - Decided against appellant.

Summary

Issues Involved:
1. Pre-deposit requirement under Section 129E of the Customs Act.
2. Joint and several liability for customs duty and penalty.
3. Compliance with statutory conditions for filing an appeal.

Summary:

Pre-deposit Requirement under Section 129E:
The appeal was filed against the Order-in-Original No. 16/2022/SG/Pr. Commr./ICD-Import/TKD dated 27.05.2022, passed by the Principal Commissioner of Customs (Import), ICD, Tughlakabad, New Delhi. The appeal was listed in the defect category due to non-compliance with the pre-deposit requirement under Section 129E of the Customs Act, 1962. The Tribunal noted that the appellant had repeatedly sought extensions to make the pre-deposit, indicating delaying tactics and an abuse of the process of law. The Tribunal emphasized that compliance with Section 129E is mandatory for the appeal to be entertained.

Joint and Several Liability:
The Principal Commissioner had issued a show cause notice to 51 noticees, including the appellant, for illegal importation and mis-declaration of goods to evade customs duty. The adjudicating authority affirmed the notice and imposed customs duty and penalties jointly and severally on eight noticees. The appellant argued that the liability should be divided for the purpose of making the pre-deposit. However, the Tribunal found that the Commissioner had consciously imposed joint and several liability to protect the interest of the Revenue. The Tribunal clarified that the liability to pay the duty and penalty is imposed on all noticees jointly, and the duty cannot be bifurcated or apportioned on an individual basis.

Compliance with Statutory Conditions:
The Tribunal highlighted that the right of appeal is a statutory right, and compliance with the conditions specified under the statute is necessary. The appellant's contention that the pre-deposit should be calculated based on individual liability was rejected. The Tribunal referred to the Supreme Court's decision in Pawan Kumar -2014 (3) SCC 590, which held that in cases of composite negligence, the wrongdoer is jointly and severally liable for the entire damages. This principle was applied to the present case, affirming that the duty and penalty liability cannot be modified on an individual basis for the purpose of pre-deposit.

The Tribunal concluded that the appellant must make the pre-deposit in terms of Section 129E of the Customs Act within six weeks from the date of the order. The issue on defect was decided against the appellant.