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TMI Blog2014 (9) TMI 326X X X X Extracts X X X X X X X X Extracts X X X X ..... e huge revenue. It cannot be accepted that on the mere score of re-export of the prohibited goods, no redemption fine was payable under Section 125 of the Customs Act. Prayer for reduction in fine and penalty - Held that:- As to the imposition of fine on the assessee as well as the penalty levied on the Directors of M/s. CMTPL, we do not find there exists any good ground justifying any reduction, particularly, in the context of the statement made by the Directors indicating the awareness of import of R-22 refrigerant gas and the goods imported were misdeclared on the quantity as well as on the value assigned to them. - Decided against the assessee. - Civil Misc. Appeal Nos. 3231, 3260 and 3295 of 2013 - - - Dated:- 11-12-2013 - Chitra Venkataraman and T.S. Sivagnanam, JJ. Shri V. Balasubramanian, for the Appellant. Shri T.S. Rajamohan, for the Respondent. JUDGMENT Following is the question of law raised by the assessee seeking admission of the above Civil Miscellaneous Appeals. 1. Whether the imposition of penalty of ₹ 1,00,000/- on the appellant is legally sustainable in the absence of any mens rea and especially when the imported gas was recl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the import consignments of M/s. CMTPL, he stated that one of their Directors was present during the said examination and concurred with the Mahazar proceedings dated 7-12-2010 too. 4. A search was conducted on 8-12-2010 at the residential premises of one of the Directors of CMTPL, Chennai viz., Shri. Khatri Khushiram Pirumal; simultaneously, search was conducted on 8-12-2010 at the office-cum-factory premises and certain documents were recovered. Shri Mohamed Gawher Rauf alias Sanjay, one of the Directors in M/s. CMTPL, Chennai admitted in his voluntary statement dated 9-12-2010 given before the Senior Intelligence Officer, DRI, Chennai under Section 108 of the Customs Act, 1962 that they have misdeclared the import consignment as HCFC R-401A instead of R-22 refrigerant gas. 5. On the submissions made and tests reports available, the Adjudicating Authority held that the imported item was nothing but R-22 refrigerant gas, consequently, proceedings were initiated for misdeclaration on the imported prohibited item. Enclosing the technical details, the assessee was asked to show cause on the proceedings taken, the assessee requested re-testing to ascertain the correct composition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n alone and pointed out that letter dated 19-5-2012 from the assessee showed that even though the assessee sought for cross-examination of the expert, it, however, prayed for lenient view to be taken, it being a small scale industry. Further referring to the statement made by the various Directors of the Company, the Customs, Excise and Service Tax Appellate Tribunal, ultimately held that there was no infirmity in the order of Adjudicating Authority. On the refusal of the request of the importer in its letter dated 19-5-2012 for cross-examination, the Customs, Excise and Service Tax Appellate Tribunal further pointed out that no material was placed by the importer to show that it was not R-22 refrigerant gas before the Commissioner too; however, the request of the assessee to allow re-export was allowed. The CESTAT confirmed the order of the Commissioner allowing re-export upon payment of redemption fine and penalty. Aggrieved by this, the present Civil Miscellaneous Appeal by the importer. 11. Learned counsel appearing for the importer/assessee strenuously contended that when the assessee sought for cross-examination of the expert from IIT on the test report given, the Customs, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l persons as well as investigating agency and the importer. The test report dated 2-5-2012 from IIT, Chennai confirming the earlier finding was given to the assessee, which was acknowledged by letter dated 19-5-2012. 17. As is evident from the reading of the order of the Adjudicating Authority in paragraph 33, the assessee no doubt asked for permission to cross-examine the expert, however, it further added that if the same was not feasible, it sought for adjudication based on oral and written submissions already made by them and they further stated, being a Small Scale Industry Unit, they could not afford to waste time by cross-examination as the consignment were losing shelf life . The Customs, Excise and Service Tax Appellate Tribunal looked into these letters as well as the DRI officials inspection report and the statement recorded and ultimately came to the conclusion that there was no straight jacket formula to allow cross-examination in all the cases, consequently, there was no violation of principles of natural justice. In the background of the findings based on materials, which was concurred by the CESTAT below, we do not find any justifiable ground to take a different ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -export. 19. The Customs, Excise and Service Tax Appellate Tribunal confirmed the said view in paragraph 12 of the order and held that there was no case for interference. 20. A reading of Section 125 of the Customs Act, 1962 shows that whenever confiscation is authorised by the Customs Act in the case of goods which are prohibited under the Act or under any law for the time being in force, the Authority may give the owner of the goods an option to pay such fine in lieu of confiscation as the said officer thinks fit. The proviso to Section 125 of the Customs Act, 1962, however, states that the fine imposable under Section 125 of the Customs Act shall not exceed the market price of the goods confiscated, less in the case of imported goods the duty chargeable thereon. Apart from that, the owner of the goods shall be liable to any duty and charges payable in respect of such goods. On confiscation, the goods vest in the Central Government. Thus, in the face of misdescription found on the inspection and testing report, the Adjudicating Authority as well as the Customs, Excise and Service Tax Appellate Tribunal justified the levy of fine in lieu of confiscation. 21. Learned couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct does not calls for proposition of law that on the re-export of goods there could be no redemption fine or duty leviable. 23. In the decision reported in 2003 (152) E.L.T. 257 (S.C.) in the case of Collector of Customs, Bombay v. M/s. Elephanta Oil Industries, the Apex Court pointed out that merely because permission was granted to the assessee to re-export the goods, the same would not mean sub-clause (a) of Section 112 of the Customs Act, 1962 would not stand attracted. Section 112 of the Customs Act is different from the confiscation of the goods under Section 125 of the Customs Act. The Apex Court further pointed out that the facility to re-export does not, in any manner, take the case out of purview of Section 125 to levy redemption of fine. 24. In the background of the said decision as well as on the facts, we do not find any justifiable ground to interfere with the order of Customs, Excise and Service Tax Appellate Tribunal. 25. Learned counsel appearing for the assessee prayed for reduction on the fine levied in this case. As to the imposition of fine on the assessee as well as the penalty levied on the Directors of M/s. CMTPL, we do not find there exists any g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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