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2024 (4) TMI 44 - AT - CustomsValidity of proceedings against importer when the sole proprietor of the firm had expired - mis -declaration and short payment of duty - imposition of penalty on appellant - HELD THAT - It is found that no proceedings can continue under the Customs Act in case when the sole proprietor Shri Prahlad Agarwal of M/s Ganpati Enterprises on 04.03.2010 expired and the Death Certificate was also placed before the adjudicating authority. As the sole proprietor has passed away then the proceedings against the importer M/s Ganpati Enterprises abates and there is no provisions under the Customs Act 1962 to continue the proceedings against the the legal heir Shri Ritesh Agarwal in the impugned proceedings as held by the Hon ble Apex Court in the case of SHABINA ABRAHAM AND OTHERS VERSUS COLLECTOR OF CENTRAL EXCISE CUSTOMS 2015 (7) TMI 1036 - SUPREME COURT wherein the Hon ble Apex Court has held Section 6 of the Central Excises Act which prescribes a procedure for registration of certain persons who are engaged in the process of production or manufacture of any specified goods mentioned in the schedule to the said Act does not throw any light on the question at hand as it says nothing about how a dead person s assessment is to continue after his death in respect of excise duty that may have escaped assessment. Thus no proceedings can continue against the importer M/s Ganpati Enterprises and Shri Ritesh Agarwal who is the legal heir of the proprietor of M/s Ganpati Enterprises. Imposition of penalty on Shri Jagdish Prasad Khaitan - HELD THAT - There is no role involved in the import of the impugned consignment by M/s Ganpati Enterprises as he was involved only at the time of delivery of the goods released provisionally therefore no nexus has been proved by the Revenue against Shri Jagdish Prasad Khaitan. Accordingly no penalty is imposable on Shri Jagdish Prasad Khaitan. The impugned order is set aside and the appeal filed by M/s Ganpati Enterprises abates and the appeals filed by Shri Ritesh Agarwal and Shri Jagdish Prasad Khaitan are allowed.
Issues involved:
The issues involved in the judgment include the continuation of proceedings under the Customs Act after the death of the sole proprietor, and the imposition of penalty on an individual involved in the delivery of goods. Issue 1: Continuation of proceedings after the death of the sole proprietor The case involved the importation of goods by M/s Ganpati Enterprises, a sole proprietorship concern, and subsequent proceedings after the death of the sole proprietor, Shri Prahlad Agarwal. The Tribunal found that as per the Customs Act, when the sole proprietor passed away, the proceedings against the importer, M/s Ganpati Enterprises, abated. The Tribunal referred to a Supreme Court case to support this decision, emphasizing that there were no provisions under the Customs Act to continue proceedings against the legal heir, Shri Ritesh Agarwal. The High Court of Delhi also supported this view in a similar case, highlighting the absence of machinery provisions in the Customs Act to proceed against legal heirs of a deceased assessee. Issue 2: Imposition of penalty on an individual involved in the delivery of goods Regarding the imposition of penalty on Shri Jagdish Prasad Khaitan, the Tribunal noted that he was not involved in the import of the consignment by M/s Ganpati Enterprises but was only involved at the time of delivery of the goods released provisionally. The Tribunal found that there was no proven nexus between Shri Jagdish Prasad Khaitan and the importation process, leading to the decision that no penalty could be imposed on him. In conclusion, the Appellate Tribunal CESTAT KOLKATA ruled that proceedings could not continue against M/s Ganpati Enterprises and Shri Ritesh Agarwal, the legal heir, after the death of the sole proprietor. Additionally, the Tribunal determined that no penalty could be imposed on Shri Jagdish Prasad Khaitan due to the lack of involvement in the importation process. As a result, the impugned order was set aside, the appeal filed by M/s Ganpati Enterprises abated, and the appeals filed by Shri Ritesh Agarwal and Shri Jagdish Prasad Khaitan were allowed.
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