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TMI Blog2024 (12) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... tera Medan Group i.e. foreign supplier for the sale and supply of 18MT of Raw cashew nuts at USD 1405 per MT. In pursuance of this purchase order, the Appellant filed Bill of Entry No. 4556542 dated 08.02.2023 for import of the said raw cashew nuts. 3. The said consignment came to be inspected and it was found that out of the total material ordered by the Appellant, 180 jute bags weighing 15.04 MT were filled with areca nuts rather than cashew nuts. As areca nuts were never declared in the Bill of Entry filed by the Appellant, the same was put under seizure on 17.02.2023. 4. The Appellant immediately contacted the foreign supplier regarding the same and the foreign supplier in response to the same vide email dated 06.03.2023 accepted the mistake and confirmed that the said material was wrongly dispatched to the Appellant. The bank of Appellant also requested the bank of the supplier to recall the telegraphic transfer of consideration paid. 5. The Appellant vide their letter dated 17.05.2023 informed the Customs Department that they have never ordered areca nuts and therefore they abandon the goods. 6. Statement of the Partners of the Appellant firm were recorded during the cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or confiscation. It is seen in the Customs Act, there is no provision that if goods has not been ordered and the same has been arrived, the person (in whose name the documents are) is required to approach to Revenue to say that I am not the owner of the goods. In this case, when appellant is not owner of the said goods, the Revenue is at liberty to deal the goods in any manner by way of absolute confiscation or by confiscation and allow to be redeemed on payment of redemption fine who claimed the owner of the goods or without confiscation of the goods to be released to the person who claimed the owner of the goods. In this case, admittedly the appellant never owned the goods nor filed Bill of Entry. 10. In these set of facts, it is to be seen that the penalty can be imposed on the appellant under Section 112(a) of the Act for violation of Section 111(d), (m), (n) and (o) of the Act or not? Therefore, to impose penalty under Section 111(d), (m), (n) and (o), we have to see provisions of the Act which are reproduced herein under : Section 111(d) in the Customs Act, 1962 "(d) any goods which are imported or attempted to be imported or are brought within the Indian customs wat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore right in concluding that even in any case where description was changed within in invoice or in the Bill of Entry or import manifest the same was sufficient to call for confiscation liability of goods under Section 111(m) of the Act as in that case the importer had not filed Bill of Entry which has been affirmed by the Hon'ble Apex Court by holding that in such a situation where Bill of Entry is not the provision of Section 111(m) are not attracted. The only provision of Section 111(d) can be attracted in this case to say that the goods are attempted to be imported contrary in prohibition. We find that in this case, the ld. Counsel has relied on certain cases. 12. We find that in the case of Arya international (supra), this Tribunal has observed that in case the Bill of Entry was not filed declaring description or quantum of the goods and there is no other evidence on record showing the appellant's involvement in loading the goods at the exporters end. Therefore, the penalty was not imposed. The same view taken in Royal Impex (supra), wherein Tribunal has held as under : 4. After giving careful consideration to the submissions, we have to accept the appellants' case. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce. Further, in the case of Garima Trade Services Ltd. (supra), this Tribunal has held that in case the importer is abandoned the goods and not opted to redeem the same, the penalty is not imposable. But this case is on better footing than the case of Garima Trade (supra), therefore we hold that as the appellant has not filed any Bill of Entry neither placed order for supply of the impugned goods to the supplier/exporter, the penalty under Section 112(a) of the Customs Act is not imposable on the appellant. 14. In these terms, we do not find any merit in the impugned order, the same is set aside. Appeal is allowed with consequential relief, if any." 11. It is also undisputed fact in the present case that the goods were abandoned by the Appellant through their letter dated 17.05.2023. Ld. Principal Commissioner has denied the benefit under Section 23 of the Customs Act, 1962 only on the ground that it appears to be an afterthought. However, we find that the similar issue arose before the division bench of this tribunal in case of Commissioner of Customs Vs. Ankit Pulps & Boards Pvt. Ltd. reported in 2007 (209) ELT 135 (Tri.-Mumbai) wherein it is observed as under: "7. The de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Appellant firm under the provisions of Section 114A of the Customs Act, 1962, we find that Section 114A deals with situations of intentionally making or using any declaration, statement or document which is false or incorrect in the transaction of any business for the purpose of Customs Act, 1962. The said Section is intended to penalize situation where there are paper transaction without any actual import or export of goods. In the present case, the revenue department has no case that the transaction was a paper transaction and that no goods were imported by the Appellant and therefore, we hold that penalty under Section 114A is not attracted. We find that the similar issue arose before the division bench of this tribunal in case of Interglobe Aviation Ltd. reported in 2022 (379) ELT 235 (Tri.-Bang) wherein it is observed as under: "20. Coming to the various penalties imposed, the appellants submit that when the demand is not tenable interest under Section 28AA of the Customs Act is not imposable as per Apex Court judgment in the case of Pratibha Processors v. UOI, 1996 (88) E.L.T. 12. We find that in the instant case as the duty is held to be payable interest follows consequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "5. A perusal of the impugned order of the Tribunal as a whole, does not reveal that any specific role is attributed to the respondent who is one of the partners in the firm, and there is no adjudication to this effect in the said order. The Tribunal has relied upon the Division Bench decision in the case of Jaybee Industries v. CCE, Gurgaon as reported in 2004 (168) E.L.T. 316 (Tri.-Del.) to come to the conclusion that where a penalty is imposed on a partnership firm, no separate penalty can be imposed on any of its partners. It has been noticed by the Tribunal that the respondent has been penalized and penalty has also been imposed upon the assessee-firm for the outstanding duty, which is not permissible in law and, therefore the penalty imposed upon the respondent, being a partner, is set aside. 6. The learned counsel for the appellant could not point out any provision in the Central Excise law, which treats a partnership firm as a separate excisable entity from its partners. Admittedly, a partner is not a separate legal entity and cannot be equated with the employees of a firm. Once the firm has already been penalized, separate penalty cannot be imposed upon the partner. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ." 11. Having perused the observations of learned Single Judge of Calcutta High Court in the case of TarakNath Sen (supra), we find that a firm in mercantile usage is the firm in its own, strictly in the eye of law, it is not a legal entity like a natural person. Therefore, the rights and obligations of a firm are really rights and obligations of the individual partners of the firm, therefore, penalty imposed on the firm would amount to imposition of penalty to the proprietor or the partner, as the case may be, therefore, imposition of penalty on the proprietor independently would not be legal. 12. Appeal is allowed. Imposition of penalty on the appellant stands set aside." 16. For the reasons above and respectfully following the settled principle we set aside the penalty imposed on all the partners of the Appellant firm. 17. Further, on perusal of the findings of Ld. Principal Commissioner in the impugned order no specific reason or findings is attributed which can concretely prove any mala fide or misstatement on the part of the employees of the CHA firm (Customs Broker Firm). Therefore, the penalties imposed on the employees of the CHA firm (Custom Broker Firm) is also s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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