2024 (3) TMI 361 - AT - Customs

Demand duty - Allegation of import Portland Pozzolana Cement without payment of customs duty - No evidence for actual import of the goods - Remittance of the money to the exporter's bank at Bangladesh through the Appellant's Axis Bank/IndusInd Bank at Agarthala - importer failed to produce self-certified import documents - interest - penalty - HELD THAT - In the absence of any such evidence of actual import of the goods, it is not known how the Revenue has presumed that import of the said goods have taken place. We observe that Customs duty cannot be demanded from the importer without filing of the Bills of Entry. Accordingly, we hold that the demand cannot be made only on the ground of transfer of money from the Appellant's Bank Account to the Exporter in Bangladesh. The Department could have conducted investigation to find out the purpose for which the money was transferred or they could have transferred the case to the concerned department to investigate on the money laundering angle. Without initiating any such action, demanding customs duty only based on the money transfer to the Exporter's Bank Account is not supported by any evidence. Accordingly, we hold that the demand of customs Duty only based on the evidence of money transfer is not sustainable and hence, we set aside the same. Since the demand of customs duty is not sustainable, there is no question of demanding interest or any penalty. Accordingly, we set aside the penalties imposed on the Appellant u/s 114A and 112(b)(ii) of the Customs Act, 1962. Thus, we set aside the impugned order and allow the appeal filed by the Appellant.

Summary

Issues:
The issues involved in the judgment are the demand of Customs duties, penalty under section 114A of the Customs Act, 1962, and penalty under Section 112(b)(ii) of the Customs Act, 1962.

Customs Duties Issue:
The Appellant imported Portland Pozzolana Cement but allegedly failed to pay Customs duties amounting to Rs.29,47,625/- during a specific period. The Department claimed that the goods were imported without payment of customs duties, alleging collusion, wilful mis-statement, and suppression of facts. However, the Appellant did not produce essential import documents to support the actual import of the goods. The only evidence relied upon was the remittance of money to the exporter's bank in Bangladesh, but no concrete proof of actual import was provided. The Tribunal held that Customs duty cannot be demanded solely based on money transfer without sufficient evidence of actual import, and set aside the demand.

Penalty Issue:
The Commissioner imposed a penalty on the Appellant under Sections 114A and 112(b)(ii) of the Customs Act, 1962. However, since the demand of Customs duty was found to be unsustainable due to lack of evidence supporting the actual import of goods, the Tribunal also set aside the penalties imposed on the Appellant. Without a valid Customs duty demand, there was no basis for levying interest or penalties. Consequently, the penalties under the mentioned sections were also set aside.

Decision:
The Tribunal set aside the impugned order and allowed the appeal filed by the Appellant, emphasizing that the demand of Customs duty based solely on money transfer evidence was not sustainable. The judgment was pronounced in the open court on 05.03.2024.