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TMI Blog2025 (1) TMI 437X X X X Extracts X X X X X X X X Extracts X X X X ..... dingly, the interest already paid appropriated by the appellant-importer against their interest liability confirmed in the impugned order. Penalties have been imposed under Sections 114A and 114AA of the Customs Act, 1962 - HELD THAT:- The appellant-importer were under the bona fide belief that SAD was exempted for the raw sugar was available even after April 8, 2011 and filed the bills of entry claiming the exemption. If the exemption was not available to them, the Customs authorities should have pointed out the same. Instead, we observe that the Bills of Entry filed by the appellant-importer were cleared without raising any query by the officers. Thus, the appellant-importer cannot be held responsible for the delay in payment of SAD. Further, we observe that Section 114A provides for imposition of penalty for short levy or non-levy or short payment or non-payment of duty by the reason of collusion or any wilful misstatement or suppression of facts. In this case, it is observed that there is no wilful misstatement or suppression of fact on the part of the appellant and hence the primary condition precedent for invoking Section 114A are absent. Accordingly, the penalties imposed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alty imposed on the appellant-importer under Sections 114A and 114AA of the Customs Act, 1962 is set aside. The penalty imposed on the CHA under Section 112(a)(ii) of the Customs Act, 1962 is set aside. All the appeals are disposed of. - SHRI R. MURALIDHAR, MEMBER (JUDICIAL) AND SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL) Dr. Samir Chakraborty, Senior Advocate, Shri Abhijit Biswas, Advocate, Shri Chandrasekhar Gupta, Chartered Accountant - For the Assessees(s) Shri Tariq Sulaiman, Authorized Representative - For the Revenue ORDER Customs Appeal No. 78181 of 2018 has been filed by M/s. Shree Renuka Sugars Limited (hereinafter referred as the appellant-importer ) against the Order-in-Original No.KOL/CUS/COMMISSIONER/PORT/41/2018 dated 15.05.2018 passed by the Commissioner of Customs (Port), Custom House,15/1, Strand Road, Kolkata 700 001. 1.1. Customs Appeal No. 77955 of 2018 has been filed by M/s. J.M. Baxi Co (hereinafter referred as the CHA ) against the Order-in-Original No.KOL/CUS/COMMISSIONER/PORT/41/2018 dated 15.05.2018 passed by the Commissioner of Customs (Port), Custom House, 15/1, Strand Road, Kolkata 700 001 challenging the penalty imposed against them in the impugned order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respectively. The Ld. Commissioner also allowed the appellant-importer to make the payment of interest in 12 instalments with effect from June, 2018. As allowed under the said Order-in-Original, the appellant-importer, on 28.06.2018, deposited an amount of Rs.2.00 crores and on 27.07.2018 Rs 2.00 crores towards the said interest liability. 2.4. The appellant-importer has filed the present appeal against the imposition of penalties and interest only. They have not contested the demand of Customs duty confirmed in the impugned order. 3. During the course of hearing, the appellant-importer has made the submission that there was no dispute with respect to the classification of the said imported raw sugar or the duty payable thereon at the time of clearance of the said goods availing benefit under the said Notification No. 12/2012-Cus dated March 17, 2012, until July 2013. The appellant-importer was informed by the officers that the Finance Act, 2011 omitted product 'sugar' from the list of First Schedule to the Goods of Special Importance Act and the necessary notification thereof was issued in 2012 and therefore the appellant-importer was liable to pay SAD on the raw sugar imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t raising any query. Thus, the appellant-importer contends that they cannot be held responsible for the non-payment of SAD. Thus, when the liability of SAD was pointed out and the goods imported were detained, to avoid accruing of huge interest on the said purported demand of SAD in the show cause notice in the event of the appellant-importer not succeeding in contesting the purported duty demand, they have deposited the said duty demand of Rs. 73.04 crores during the pendency of the adjudication proceedings. The appellant-importer also submits that the demand of interest under Section 28AA of the Act on the wrongfully confirmed duty demand of Rs. 73.04 crores is illegal, invalid and bad in law; therefore, the Commissioner should return the interest of Rs. 1.00 crore deposited by them during the course of adjudication proceedings; instead, the Ld. Commissioner has appropriated and adjusted the same towards the non-leviable interest liability. In this regard, the appellant-importer submits that they have established their bonafides in availing the exemption and hence prayed for waiver of interest and penalty imposed on them. 3.3. The appellant-importer further submits that the deman ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in such cases, neither there can be confiscation of the subject goods nor imposition of any penalty upon the assessee-importer. In this regard reliance is placed upon inter alia the following decisions :- i. Northern Plastic Ltd. Vs. CC CE [1998 (101) ELT 549 (SC)] ii. Commissioner of Customs Vs. Gaurav Enterprises [2006 (193) ELT 532 (Bom.)] iii. A.V. Global Corporation Pvt. Ltd. Vs. Commissioner of Customs [2024(10) TMI 159-CESTAT, NEW DELHI.] 3.5. The appellant-importer submits that confiscation of the goods importer is not warranted as there was no wilful, intentional and deliberate non-payment of SAD. They submit that all the Bills of entry were cleared after obtaining due permission from the jurisdictional Customs authorities. The customs authorities at Kolkata/Haldia initiated the instant proceeding against the appellant only after issue of the Alert Notice dated April 10, 2013 by the Kandla Customs authorities asking all Customs formations in the country, including the respondent, to levy 4% SAD on the plea that exemption from SAD was no longer available. Thus, the appellant-importer submits that the goods imported after obtaining due permission from the proper officers ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue there is any material evidence provided as to how and in what manner the said specific requirements under 112(a) has been satisfied in the instant case. Since the condition precedent for imposing penalty on the officers under Section 112(a) of the Act has not been satisfied, the Ld. Commissioner has rightly dropped the proceedings for imposing penalty against the five officers. Thus, they prayed for rejecting the Revenue's appeal. 3.9. Regarding the penalty imposed against M/s. J.M. Baxi Co., the CHA, it has been submitted that they have filed the bills of entry as per the documents furnished by the appellant-importer; they have been filing Bills of Entry for importing raw sugar prior to April 2011, by claiming the exemption as provided under the Notification No. 12/2012-Cus (Serial No. 76, condition 3A), without payment of SAD for the period prior to April 8, 2011; they continued to file the Bills of Entry by claiming the same exemption even after April 2008. It is contended that ff the exemption was not available to them, then the Customs authorities should have pointed out the same and raised the query; instead, the Bills of entry filed by them were cleared without rais ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e observe that Section 3(12) is an inclusive provision. It makes the provisions of the Customs Act applicable in relation to levy of SAD under the Customs Tariff Act. The section specifically includes provisions such as drawback, refund and exemptions applicable in Customs Act, and has been made applicable to SAD levied under CTA also. It does not mean that the provisions relating to levy of demand of interest under Customs Act are not made applicable for the delay in payment of SAD. When there is a delay in payment of SAD, interest is automatically liable to be paid as per Section 28AB of Customs Act, 1962, which is applicable in this case. Accordingly, we hold that interest has been rightly demanded in the impugned order. Accordingly, we appropriate the interest already paid by the appellant-importer against their interest liability confirmed in the impugned order. 6.2. Regarding imposition of penalty on the appellant-importer, we observe that penalties have been imposed under Sections 114A and 114AA of the Customs Act, 1962. We observe that the issue involved is of interpretational in nature. It is also observed that the appellant-importer has not suppressed any information from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion No. 12/2012-Cus (Serial No. 76, condition 3A), without payment of SAD for the period prior to April 8, 2011. They continued to file the Bills of Entry by claiming the same exemption even after April 2008. If the exemption was not available to them, then the Customs authorities should have pointed out the same and raised the query. Instead, we observe that the Bills of entry filed by the CHA were cleared without raising any query by the officers. Thus, we hold that the appellant-CHA cannot be held responsible for the wrong claim of the benefit of the exemption as provided under the Notification No. 12/2012-Cus. Accordingly, we hold that the penalty imposed on the CHA under Section 112(a)(ii) of the Act is not sustainable and hence, we set aside the same. 9. Regarding the Revenue's appeal in respect of dropping of the proceedings against five officers of the appellant-importer holding that they were not found to be liable for penal action under the Customs Act, 1962, we find that the ld. adjudicating authority has given a finding for dropping the proceedings against these persons. For the sake of ready reference, the relevant paragraph from the impugned Order-in-Original is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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