2024 (11) TMI 845 - AT - Customs

Imposition of fine and penalty - Rejection of declared value and redetermined the value under Rule 12 of Customs Valuation (Determination of Price of Imported Goods) Rules, 2007 - goods u/s 125 of the Customs Act, 1962 with an option to redeem the same on payment of fine of Rs.3,25,000/- and also imposed penalty of Rs.1,50,000/- under sec. 112(a) ibid for having rendered the goods liable for confiscation under sec. 111 ibid. HELD THAT - As carefully perused the Appeal we find that the issue involves a non-deliberate contravention of law, due to the exigencies of the business process. No loss of revenue or deliberate intention to evade payment of duty is made out. It is true that any breach of a civil obligation under the Act is a blameworthy conduct by the appellant and can be visited with a penalty as provided for in the Act and Rules. However a distinction has to be drawn between a bona fide-mistake and dishonest non-compliance while imposing a fine and penalty. The goods are not prohibited for import. In M/s. Hindustan Steel Ltd. v. The State of Orissa 1969 (8) TMI 31 - SUPREME COURT held that Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances . Aassessable value of the goods involved in this case has been determined at Rs 6,54,349/-, with a fine of Rs 3,25,000/- and a penalty of Rs 1,50,000/-. Hence feel that the fine and penalty imposed in this case are excessive and needs to be moderated. A fine of Rs.6,500/- (Six Thousand Five hundred only) and a penalty of Rs.1,000/- (One thousand only) would be appropriate. The appeal is disposed of on the said terms.

Summary

Issues:
1. Imposition of fine and penalty on the appellant.

Analysis:
The judgment pertains to an appeal against an order passed by the Commissioner of Customs imposing a fine and penalty on the appellant. The appellant had filed a courier Bill of Entry for clearance of imported goods, which led to discrepancies between the declaration and examination. The original authority rejected the declared value, confiscated the goods, and imposed a fine and penalty. The appellant contended that the appeal was only against the fine and penalty, not the valuation. The appellant's representative argued that the discrepancies were due to circumstances beyond their control, such as misplacement of packages by the courier company. The original authority held the appellant guilty of misdeclaration with malafide intent. The Commissioner of Customs upheld this decision, leading to the current appeal.

The appellate tribunal considered the facts and circumstances, noting that there was no deliberate intention to evade duty. The tribunal cited the distinction between bona fide mistakes and deliberate non-compliance. Referring to legal precedent, the tribunal emphasized that the imposition of penalties should be judicious and based on relevant circumstances. The assessable value of the goods was determined, along with the fine and penalty. The tribunal found the imposed fine and penalty excessive and decided to moderate them. Consequently, the tribunal reduced the fine to Rs.6,500 and the penalty to Rs.1,000, disposing of the appeal on these terms.

In conclusion, the tribunal's decision focused on the proportionality of the fine and penalty imposed on the appellant. By considering the circumstances leading to the discrepancies and the absence of deliberate evasion, the tribunal reduced the financial burden on the appellant to a more reasonable amount. The judgment underscores the importance of balancing enforcement with fairness in customs matters, ensuring that penalties are commensurate with the offense committed.