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2024 (5) TMI 211 - GUJARAT HIGH COURT
Power Of Board for the purposes of facilitation of trade u/s 143AA - Seeking release of the original bill of lading and release of the cargo - Imports of the shipment of Soda Ash Dense (Grade-A) - Payment of the requisite duty - HELD THAT:- None of the conditions prescribed in 143AA of the Act applies to the facts of the present case and, therefore, the Commissioner is not required to take any action under Rule 11(2) of the Rules as prayed by the petitioner. We are of the opinion that dispute is between the petitioner and the Respondent No. 3 for which Commissioner of Customs is not concerned and accordingly the petitioner is required to sort out such disputes with Respondent No. 3 in accordance with law. No interference is required to be made in this petition. The petition being devoid of merits is accordingly dismissed.
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2024 (5) TMI 210 - GUJARAT HIGH COURT
Power of High Court to entertain writ petition - alternative efficacious remedy u/s 129A - time limitation including extended period of limitation - Smuggling of huge quantity of gold into India - Seizure - confiscation - Penalty u/s 112(a) and 112(b) and 114AA read with section 123 of the Customs Act, 1962 (‘the Act’) - Denial of opportunity to cross-examine the witnesses and co-noticees - breach of the principle of natural justice - Whether the petitioners can raise such issue of cross-examination, supply of documents before the appellate authority or not - HELD THAT:- The petitioners have mainly rebutted the preliminary objection raised on behalf of the respondent-authority for entertaining these writ petitions on the ground of having alternative remedy and violation of principle of natural justice as the respondent-authority has not decided the application/request of the petitioners to grant cross-examination of two co-noticee viz. Ms. Nita Parmar and Mr. Rutugna Trivedi and rejected such request in the impugned order. Another ground for preferring these petitions with request to entertain the same is for not supplying the relied upon documents in the pend drive which is according to the petitioner is a basis for passing the impugned order.
The facts of the case are so gross to the effect that the petitioners are involved in smuggling of Gold in contravention of the provision of the Customs Act. Therefore, without going into merits of the case, it would be in the interest of justice to relegate the petitioners to avail the alternative efficacious remedy as held by the Apex Court in case of Assistant Commissioner (CT) LTU v. Glaxo Smith Kline Consumer Health Care Limited[2020 (5) TMI 149 - SUPREME COURT] from time-to-time and to enable the petitioners to raise all the contentions before the appellate authority in the appeal which may be filed by the petitioners. It would be also necessary to mention here that the adjudicating authority had already taken a decision to deny the cross-examination to the petitioners of the co-noticee. Even if the matter is sent back to the adjudication authority, it would be a futile exercise for the adjudicating authority to again pass a separate order rejecting the demand for cross-examination. Therefore, we are of the opinion that such a course would result into an empty formality so as to comply with the principles of natural justice.
Even if the matter is remanded back to the adjudicating authority, there is a fait accompli of rejection of the request of the petitioners as stated by the adjudicating authority in the impugned order and no fruitful purpose would be served except setting aside the order and putting the clock back for such empty formality. If the appellate authority is of the opinion that the cross-examination is required to be given to the petitioners on the basis of the contention which may be raised by the petitioners after considering the observations made by the adjudicating authority in the impugned order, it is for the appellate authority to consider such request by calling for remand report from the adjudicating authority to that extent. However, simply because the right of cross-examination is denied to the petitioners, we are of the opinion that the matter should not be remanded back to the adjudicating authority in the facts of the case which are glaring and resulting into the impugned adjudication order which is liable for challenge before the appellate authority.
Thus, these petitions are not entertained as though it may be maintainable under Article 226 of the Constitution of India with liberty to the petitioners to approach to the appellate-authority. The time spent by the petitioners before this Court be considered as bona fide by the appellate authority if the petitioners file appeals before the appellate authority in accordance with law within four week from today without raising an issue of delay.
Thus, the petitions are disposed of. Notices are discharged. Interim relief stands vacated forthwith.
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2024 (5) TMI 209 - CESTAT AHMEDABAD
Valuation - Assessable value of import vessel - Valuation of revised (reduced) price - Duty demand - HELD THAT:- We find that in the instant case the price was declared on the basis of the first MOA entered between the appellant and the cash buyer wherein it was believed that the LDT of the ship is 10386 MT. However, at the time of import it was found that the LDT of the ship was 10,200 MT. Thus, there was a short fall of approximately 186 MT in the LDT as compared to the originally agreed LDT. Consequently, the price was revised by entering into fresh MOA. The facts regarding the original and fresh MOAs were explained by the learned counsel as already recorded in his submission.
We do not find any merit in the impugned order rejecting the value based on the revised MOAs when the LDT declared in original MOA was found to be different from the actual LDT. In these circumstances, ratio of decisions in Chaudhary Ship Breakers) [2023 (6) TMI 1200 - CESTAT AHMEDABAD] squarely apply. Consequently, demand is set aside and appeal allowed.
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2024 (5) TMI 208 - CESTAT AHMEDABAD
Imports ‘Cyanuric Chloride’ - Rejection of declared value of import - contemporaneous import - Revenue not produced the necessary documents - HELD THAT:- We find that the Revenue has failed to fulfil the requirement of producing evidence of contemporaneous import. The basis of rejection of declared value and revision thereof is contemporaneous import. The Revenue does not seem to have the said evidence of contemporaneous import as they have failed to produce despite large number of opportunities. In that circumstances the appeal has to be allowed.
The appeal is allowed with consequential relief.
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2024 (5) TMI 145 - CESTAT AHMEDABAD
Demand of custom duty and imposition of penalty - non payment of duty on slop/waste Oil of foreign origin - cleaning the inner walls of the tanker by applying water with the help of a pressure jet - HELD THAT:- The oil obtained by cleaning the tanker is pre- dominantly mixed with water. Only approximately 10% is oil and 90% is water. In this position, the waste oil/slop oil cannot be classified as crude oil under heading 2710 in terms of chapter note 3 of chapter 27 which prescribes that the petroleum product should contain more than 50% by weight of benzene, toluene, xylene or naphthalene whereas in the present case the oil content is only 10% and 90 is water, therefore demanding duty considering that product as crude oil is not correct.
Without prejudice to above, we further find that it is admitted fact that while converting the vessel from foreign going to coastal run, the custom duty of Rs. 6,95,546/- was paid in regard of the entire quantity of foreign origin oil irrespective whether the subsequently same would be cleaned from the inner walls of the tank by applying water through pressure jet or collected in form of waste/ slop oil from the vessels for clearance , therefore, no custom duty can be demanded for the second time. On this fact, on the waste oil/slop oil duty cannot be demanded twice as the same goods have already suffered the custom duty while converting from foreign going vessels to coastal vessels. Accordingly, we are of the view that in the present case the demand of custom duty, interest and penalty are not sustainable.
Hence, the impugned order is set aside. Appeal is allowed.
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2024 (5) TMI 144 - CESTAT AHMEDABAD
Import of Alkalised Cocoa Powder from Malaysia - Denied FTA benefit of Notification No. 46/2011-Cus - Certificate of origin - wrongly availing custom duty benefit - differential duty - Penalty - HELD THAT:- We find that the benefit of Notification issued under FTA was denied by the Custom only on the ground that there was an intelligence that the condition of value addition of 35% in respect of cocoa powder supplied from Malaysia is not fulfilled however to support this allegation no verification was carried out by the department.
Since the facts and charges levelled in those cases and in the present case are identical, the ratio in the Shriazee Traders [2024 (1) TMI 781 - CESTAT AHMEDABAD] and M/s. BDB Exports Pvt. Ltd Vs. CC [2016 (9) TMI 1087 - CESTAT KOLKATA] are directly applicable in the present case. Therefore, following the same in the present case also, the impugned orders are not sustainable. Accordingly, the same is set aside. Appeal is allowed.
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2024 (5) TMI 143 - CESTAT BANGALORE
Levy of Penalty u/s 112 (a) and (b) and 114AA of the Customs Act, 1962 - Abetment in mis-declaration of goods and evasion of duty - imported items declaring them as sunglasses but on investigation, it was found to be readymade garments - Dummy IECS - The appellants were accused of being involved in a scheme using dummy Import Export Codes (IECs) - Stolen identity - Documents of ‘H-cardholder’ working for the Customs House Agent (CHA) used for carrying out illegal importation of goods - Denial of cross-examination of witnesses - violation of natural justice - Difference Of Opinion between learned members - Third Member Order -
Whether the evidence relied by the adjudicating authority regarding the WhatsApp messages retrieved during investigation can be considered as admissible evidence in view of the provisions u/s 138(c) of the Customs Act, 1962 read with Section 65(B) of the Evidence Act, 1872.
Whether the confession statement of first appellant u/s 108 of the Customs Act, 1962 which stood retracted is substantially corroborated by other independent and cogent evidences to sustain the allegation against first appellant.
Whether the findings of the adjudicating authority regarding role of second appellant in illegal import is sustainable considering the fact that during investigation, in spite of appearing before the investigating officer, no statement is recorded from the second appellant u/s 108 of the Customs Ac, 1962.
ORDER [Per : Ms. Sulekha Beevi. C.S] - HELD THAT:- Undisputedly, the WhatsApp messages have not been retrieved by complying the provisions of Section 138C of the Customs Act, 1962. The Tribunal in the case of Commissioner of Customs, Lucknow Vs Sanjay Soni [2022 (3) TMI 367 - CESTAT ALLAHABAD] had occasion to consider the admissibility of evidence in the nature of WhatsApp messages. It was held that messages retrieved from phone is not reliable or admissible in evidence if provisions of Section 138C of Customs Act, 1962 are not complied. Section 138C is pari materia to Section 36B of Central Excise Act, 1944. While analysing the issue of admissibility of evidence retrieved from electronic items, the Hon’ble Supreme Court in the case of Anwar PV Vs P.K. Basheer & Others [2014 (9) TMI 1007 - SUPREME COURT] had held that the compliance of conditions in Section 138C is mandatory.
Similar view was taken in the case of S.N. Agrotech Vs Commissioner of Customs, [2018 (4) TMI 856 - CESTAT NEW DELHI]. In a recent decision, the Mumbai Bench of the Tribunal in the case of M/s. Jeen Bhavani International Vs CC,[2022 (8) TMI 237 - CESTAT MUMBAI] had occasion to analyse similar issue and held that without complying with conditions of Section 138C of Customs Act, 1962, the contents retrieved from electronic items are not admissible in evidence. The evidence in the nature WhatsApp retrieved from phones cannot be considered in evidence without complying the provisions u/s 138C. The law contained in Section 36B of Central Excise Act, 1944, as well as Section 138C of Customs Act, 1962 are safeguards against arbitrary actions for the reason that it is very easy to fabricate or tamper with material contained in electronic items.
Though the statement recorded before the Customs Officer may be admissible in evidence, it has to be noted that in the present case all the noticees have retracted their statements at the earliest. Further, the statement of Sahil Moiz Zafar was not recorded at all. Even though he is a co-noticee the said appellant has been implicated on the basis of call records and the statement of other noticees. When the noticees have retracted their statement it was incumbent upon the adjudicating authority to allow cross examination when requested for by the appellants. The rejection of the request for cross examination has caused prejudice to the appellants as they were not able to bring out the credibility of the witnesses and statements recorded before Customs Officers.
The evidence in the nature of WhatsApp messages, call records cannot be relied in evidence unless the conditions u/s 138C of Customs Act, 1962 are followed. So also, the denial of cross examination has taken away the right from the appellant to establish their defence. Therefore, there is no independent corroborative evidence. In absence of independent corroborative evidence, the statement which has been retracted cannot be the sole basis to sustain the penalties against either of the appellants.
It has to be noted that in spite of appearing before the investigating officer no statement was recorded from him. The statement of the co-noticees having been retracted and cross examination of all other witnesses been denied, there is absolutely no evidence to uphold the confirmation of penalty on second appellant.
Thus, I agree with all the four points of difference as recorded by Member (Judicial).
Per R. BHAGYA DEVI : - Penalties imposed on Shri Dharaneesh Raju Shetty and Shri Shail Moiz Zafar is upheld. Accordingly, the impugned order is upheld and the appeals are dismissed.
Per: P. A. AUGUSTIAN - No presumption can be drawn that evidences brought on record by way of confession which stood retracted is substantially corroborated by other independent and cogent evidences. Thus, appeals are allowed. Penalty imposed on appellants are set aside.
MAJORITY ORDER - In view of the majority opinion, the penalties imposed on the appellants are set aside. Consequently, the impugned order is set aside and the appeals are allowed.
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2024 (5) TMI 142 - CESTAT CHENNAI
Misdeclaration in the quantity of goods imported - enhancement of the value - Transaction value - demand of duty - confiscation - Penalty - value enhanced by merely relying on NIDB data without supplying details to the appellant - No reasons stated in the order for rejection of the transaction value - whether there are sufficient grounds for rejection of transaction value, enhancement of value of goods - HELD THAT:- There is no discussion as to the details of the Bills of Entry which have been relied by the adjudicating authority. The place of import, the foreign supplier, quantity of the goods, the nature of the goods imported etc., would affect the value of the goods imported. These details are to be discussed by the adjudicating authority as well as the Commissioner (Appeals) to hold that there are sufficient grounds to reject the transaction value and for enhancing the value of the goods. We do not see such discussions either in the order passed by the adjudicating authority or the Commissioner (Appeals). Thus, we find that the enhancement of the value of goods cannot be sustained and requires to be set aside. Order accordingly.
On perusal of the records it is seen that in the bill of entry, packing list as well as other documents the quantity is declared in kilograms. However, payment of duty is on the basis of measurement in meters. On examination it was found that instead of 11,815 kilograms as declared by appellant, the total quantity imported is 11,900 kilograms. We note that the said difference in quantity is too low so as to allege intentional misdeclaration of the goods. There will be some variation in the quantity during the voyage of the goods. Taking into consideration these aspects as put forth by the Ld. Counsel for appellant, we hold that the allegation of mis-declaration of the goods cannot sustain. Consequently, the Redemption fine and penalty imposed are set aside.
In the result, the impugned order is set aside. The appeal is allowed with consequential relief if any.
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2024 (5) TMI 141 - CESTAT CHENNAI
Maintainability of appeal - non-prosecution of the case - matter adjourned beyond three times - Refund claim - rejection of appeal for non-compliance and non-replying to the ‘Deficiency Memo’ - HELD THAT:- Now before us the Appellant has not shown any urgency in having the matter heard and disposed of. Adjournments can’t be given for the mere asking without any serious reason backed with proof for non-appearance of the Appellant or his authorised representative.
Considering the statutory position and the views expressed by the Hon’ble Apex Court in the various judgments cited above, we find that no purpose would be served in continuing with this appeal and hence reject the same for default as per Rule 20 of CESTAT (Procedure) Rules, 1982. The appeal is disposed of accordingly.
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2024 (5) TMI 83 - DELHI HIGH COURT
Seeking grant of permission to export of rice - Non-fulfilment of the conditions entitling it to an exemption - Notifications for imposition of ban on export of non-basmati white rice - export of ‘Non-Basmati white rice’ was changed from ‘free’ to ‘prohibited’ with immediate effect - Whether the Appellant ought to be allowed to export 11,000 MT quantity of rice which is lying at private warehouses near the customs port at Kandla, Gujarat, on the test of substantial compliance of the conditions of exemption - HELD THAT:- It is the case of the Appellant, that despite best of its efforts and due to no fault of it, the quantity of 11,000 MT could not be handed over to the Custodian at Deendayal Port Authority prior to 20th July, 2023, due to lack of storage space at the Port, as evidenced by letter dated 2nd August, 2023, issued by the Custodian. In addition, the Appellant contends that the vessel call number was allocated to it prior to the Notification and the non-berthing of the vessel before 20th July, 2023, was beyond its control. It is, thus, the case of the Appellant that in its facts though it could have otherwise fallen within the exception of Paragraphs 2(ii) and (iii) of the Notifications, entitling it to export 11,000 MT, it was unable to strictly complete the conditions despite all actions taken at its end, due to the circumstances beyond its control.
It is noted that the Appellant initially in the writ petition and in the present appeal pleaded that despite best efforts it was unable to comply with condition no. (v) of Paragraph 2 with respect to payment of export duty on ten shipping bills for 10,000 MT, despite filing the same on to the Portal (ICEGATE) of the Respondent. The Appellant’s averment itself is vague. However, the Respondent in the counter affidavit at Paragraph 21 and 22 as well as in this appeal vehemently opposed the said allegation and asserted that the Appellant was making an incorrect statement. The Appellant asserted that its Portal ICEGATE was fully functional and there was no hindrance to any exporter (including the Appellant) in making payments of export duty within the stipulated period. The Appellant herein has since abandoned the said plea and not relied upon the same in its written submissions dated 27th February, 2024.
We find merit in the submission of the Respondent that each condition at Paragraph 2 in the Notifications is an independent exception and the exporter seeking to invoke the said exception has to fulfil each of the stipulations set out in the said condition. This is for the reason that each condition in the Notifications is intended to independently carve out an exception for facilitating export of shipments, which were in transition and the test to determine if the shipment is in transition was identified separately as condition nos. (i) to (iv) in the Notifications.
Under the Notification, the Respondent has carved out five independent exemptions so as to entitle the exporters with transitional arrangements to comply with their export obligations. The Respondent admittedly was granted the benefit of the exemption for 17,000 MT as it complied with condition no. (v) in its entirety with respect to payment of export duty.
Each of the five independent exemptions have essential requirements which the applicant exporter must comply with for completing the export. The Appellant fails to comply with the essential conditions in each of the exceptions. Therefore, the doctrine of substantial compliance relied upon by the Appellant is of no assistance as the Courts have held that latitude can be shown to the applicant only with respect to requirements which are directory in nature, the non-compliance of which would not affect the essence of the Notification granting exemption.
Since the vires of the Notifications and reasonableness of exemption condition nos. (i) to (v) is not under challenge; and the Appellant admittedly fails to satisfy the essential conditions contained in each of the independent exemptions, we are unable to accept the contention of the Appellant that it can be permitted by Respondent to export 11,000 MT by taking an overall view of substantial compliance, which in the opinion of this Court is in essence a subjective evaluation, which is not the remit of the Notifications.
Keeping in view the objective of the Central Government in imposing this ban with immediate effect was to avert a food crisis in the country, a strict compliance of the exemption conditions would further the said intent of the Notifications.
The Appellant had also placed reliance upon the interim order dated 06th December, 2023 passed by the High Court of Chhattisgarh in I.A. No. 01/2023 filed in W.P.(C) permitting the exporter therein to export non-basmati rice. In this regard, we may note that the learned Single Judge of the High Court has referred and relied upon the order dated 19th October, 2023 passed by High Court of Andhra Pradesh while passing the interim order. The Respondent has stated that it is in the process of filing a SLP against the order passed by High Court of Chhattisgarh. The High Court of Chhattisgarh has considered the fact that the exporter therein has a pre-existing contract with the foreign importer along with letter of credit for granting ad-interim permission for export. We are of the considered opinion that in view of the express suspension of the FTP, 2023, the said fact stands expressly excluded from the scope of the Notifications and therefore, could not have formed the basis for granting relief.
We have been unable to satisfy ourselves in the present appeal that the Appellant herein has satisfied the exemption conditions of the Notifications. Thus, we find that there is no merit in the appeal. Accordingly, the same is dismissed.
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2024 (5) TMI 82 - MADRAS HIGH COURT
Safeguard duty levied on the import of solar cells and modules - Validity of levy during the period when the injunction from the High Court of Orissa was active - Protection of the domestic industry - contravention of the order passed by the High Court of Orissa - Whether the statutory scheme contained in the provisions of the Act of 1975 and the Rules of 1997 have been complied with - HELD THAT:- On navigating through the discussion and the consideration of the various aspects before arriving at the final finding, it is evident that all the pleas raised by the stakeholders were considered and opportunity was given to all the stakeholders to represent their stand. The principles of natural justice are also complied with. The said final finding thereafter is accepted by the Central Government by issuing the notification. The said issuance of the notification imposing safeguard duty is a legislative act. The courts will adopt a liberal attitude in upholding the delegation when taxing power is conferred. The impugned notification is a piece of a subordinate legislation, more particularly, when the said notification imposes the safeguard duty not in reference to a particular importer, exporter or a specific country.
The final finding was arrived at by the second respondent on 16.7.2018. The interim order of injunction was passed by the Orissa High Court in W.P. The notification was issued by the Central Government imposing safeguard duty on 30.7.2018, during the subsistence of the order of interim injunction prohibiting the respondents from issuing the notification. The Supreme Court stayed the interim order of injunction passed by the Orissa High Court on 10.9.2018.
The Apex Court in the case Mulraj v. Murti Raghunathji Maharaj,[1967 (3) TMI 111 - SUPREME COURT], considered the effect of action taken subsequent to passing of an interim order in its disobedience and held that any action taken in disobedience of the order passed by the Court would be illegal. Subsequent action would be a nullity.
In DDA v. Skipper Construction Co. (P) Ltd., [1996 (5) TMI 326 - SUPREME COURT], the Apex Court after making reference to many of the earlier judgments held that those who defy a prohibition ought not to be able to claim that the fruits of their defiance are good, and not tainted by the illegality that produced them.
In the present case, though the interim order of injunction was in force when the notification was issued, the said order was stayed by the Apex Court on 10.9.2018 and on and from 10.9.2018, the notification would become operative, as the prohibitory order did not exist. The contention of the petitioners that as the notification was issued during the subsistence of the prohibitory order, even after the prohibitory order was stayed by the superior court still the notification would be inoperative, cannot be comprehended.
The notification issued is legislative in character. The executive exercised the powers of delegated legislation. The notification, during the subsistence of the interim order of injunction, is certainly inoperative, but on and from the date the stay was granted by the Apex Court to the prohibitory order passed by the Orissa High Court, the notification will become operative and binding upon the parties. The Central Government would not be required to issue a fresh notification after the order of injunction was stayed.
In the case of V.P. Sheth [1999 (9) TMI 995 - MADHYA PRADESH HIGH COURT], the appellant therein was compulsorily retired on 10.1.1989. The Central Administrative Tribunal set aside the order of compulsory retirement. The respondents filed a SLP before the Apex Court. The Apex Court stayed the final order passed by the Central Administrative Tribunal. The Apex Court in the said case observed that the effect of the stay is that the order of the Central Administrative Tribunal is not operative and the order of compulsory retirement remains in force.
Thus, it can safely be held that on and from the date the order of injunction passed by the Orissa High Court was stayed by the Apex Court, i.e., 10.9.2018, the notification became operative and effective.
In W.P., the petitioner has been assessed for safeguard duty vide Bill of Entry dated 2.8.2018. The same was during the subsistence of the prohibitory order passed by the Orissa High Court and before the stay was granted by the Apex Court. The respondents, certainly, could not have assessed the same, as during the said period the notification could not have been issued. The respondents also suggest that the same should not be assessed. Therefore, the order of self-assessment, vide the impugned Bill of Entry No.7474159, dated 2.8.2018, to the extent it seeks to impose safeguard duty pursuant to the notification dated 30.7.2018, is illegal and arbitrary, inasmuch as it was issued during the subsistence of the order of injunction, and accordingly the same is quashed and set aside.
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2024 (5) TMI 81 - DELHI HIGH COURT
Release of duty drawback and a rebate under Rebate of State and Center Taxes and Levies (ROSCTL) - 13 shipping bills uploaded on the respondent's online portal, with a formal application yet to be made. - HELD THAT:- Learned counsel for the petitioner submits that in so far as release of IGST and interest is concerned, the same already stands allowed in favour of the petitioner and the issue now surviving is with regard to release of ROSCTL. Learned counsel submits that the same pertains to 13 shipping bills which were uploaded on the online portal of the respondent, out of which 11 were uploaded on 31.03.2020 and two were uploaded on 30.10.2020.
Learned counsel for the petitioner submits that without prejudice to her rights and contentions, petitioner shall make a formal application in terms of the said procedure within a period of one week.
On such an application being filed, respondent shall process the same in accordance with the rules and law within a maximum period of four weeks from the date of submission of the application.
The petition is accordingly disposed of, reserving the right of the petitioner to take such further remedy as may be permissible in law in case aggrieved by any order passed by the respondent.
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2024 (5) TMI 80 - CESTAT NEW DELHI
Imposition of Penalties u/s 112(a) & (b) and 114AA - Each appellant denied direct involvement or knowledge of the illegal activities, claiming to have played different roles in the importation process. - import of restricted / prohibited goods - confiscation of goods - allegation for never received the summons - HELD THAT:- We have no doubts in our minds that the Sushil Aggarwal was not merely an indenting agent but was an active player involved at every stage in the entire operation from placing orders for the imported goods including the import of the prohibited goods, mis-declaration in the documents, clearance of the goods, transporting them to the godown and selling them, receiving the sale proceeds and further distributing them among various operators.
We find the penalties imposed on him under Section 112 and 114AA must be sustained and they call for no interference.
Sunil Aidasani - claims to have never received the summons and hence he had not appeared to give his statements - As far as the allegations that 12 of the 19 containers actually belonged to him are concerned, these are based on the statements of Bhalla. A statement made by Bhalla u/s 108 of the Customs Act will be relevant to prove the case only as per section 138B. This requires the adjudicating authority to examine the person making the statement and decide if it is to be admitted in evidence. Needless to say that if it is admitted in evidence and is proposed to be used against another person, such person should be allowed to cross examine the person making the statement.
Since the procedure prescribed u/s 138B was not followed, the statement is not relevant to prove the case against Aidasani.
We also find that neither section 112 nor section 114AA provide for penalty for not responding to summons or not cooperating with the investigation. Therefore, the penalties imposed on Aidasani in the impugned order cannot be sustained and need to be set aside.
Naveen Gulabani - The allegation in the SCN is that he is an employee of Sunil Aidasani@ Vicky and that he had not responded to the summons and had not cooperated with the investigation.
We find neither section 112 nor section 114AA makes one liable to penalty either for being an employee of the overseas supplier of goods nor for not responding to summons and not cooperating with the investigating agency. Therefore, the penalties imposed on Gulabani cannot be sustained and need to be set aside and we do so.
Therefore, the penalties imposed on Gulabani in the impugned order cannot be sustained and need to be set aside.
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2024 (5) TMI 79 - CESTAT NEW DELHI
Benefit of reduced penalty of 15% u/s 28(5) - Delay in payment of penalty due to Public Holiday - The appellant voluntarily paid the differential BCD and interest upon detection of the misclassification - Importation of ‘drawings and designs on paper made with aid of computer’ - Wrongly classification of the imported goods and claim of exemption - wilful misstatement or suppression of facts - HELD THAT:- No evidences are available on record to show that the appellant had bona-fide intention in claiming wrong classification of the disputed goods and availment of the exemption from payment of the BCD under the notification dated 17.03.2012 read with notification dated 30.06.2017. It is also an undisputed fact that the appellant had voluntarily paid the differential BCD and interest amount upon detection of wrong classification by the DRI. The reduced penalty amount as per sub-section (5) of Section 28 ibid was also paid suo-moto by the appellant, consequent upon receipt of the SCN. Thus, it cannot be said that the department’s action in invoking the penal provisions u/s 114A ibid is not proper or justified.
In the case in hand, since 14th and 15th of December were being holidays as second Saturday and Sunday, payments made by the appellant in the designated bank on 16.12.2019 would be considered as the deposit made within the stipulated time frame. Since, the appellant has complied with the requirement of sub-section (5) read with sub-section (6) of Section 28 ibid, in our considered view, payment of reduced amount of penalty @15% of the BCD amount would be considered as sufficient compliance in terms of the statutory provisions. Since, the appellant in this case had deposited such reduced amount of penalty, as per Section 10 of the General Clauses Act, 1897 read with Section 28 ibid, in our considered view, such deposit should meet the ends of justice for the purpose of the benefit provided for reduction in the quantum of penalty. Thus, the impugned order, imposing equal amount of penalty shall not be sustained for judicial scrutiny.
Thus, the impugned order to the extent it has confirmed equal amount of penalty on the appellant is set aside and the appeal to such extent is allowed in favour of the appellant, holding that the appellant would be liable to pay the reduced amount of penalty at the rate of 15%, which they have already complied with.
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2024 (5) TMI 78 - CESTAT BANGALORE
Levy of penalty and Revocation of Courier license - Allegation of abetting in mis-declaration of value of imported goods - Importation of mobile parts - G-card holder had fabricated documents - duty - Interest - Penalty imposed under Regulation 14 of Courier Import and Export (Electronic Declaration and processing) Regulations, 2010 and u/s 117 of the Customs Act, 1962 - bill of entry filed without complying with the KYC norms - violation of the Regulation 12 - HELD THAT:- There was omission on the part of appellant to engage the executive Shri M. Elias as authorized person to file courier bills of entry as per Regulation 12(ii) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010. However considering the situation that prevailed during post-covid period, the appellant might have failed to comply with said provision and same cannot be reason to invoke harsh proceedings including revocation of courier license and enforcement of bond and bank guarantee executed in connection with registration/license as an authorized courier. We find that for such venial omission, appropriate penalty under the provisions of Regulation 12(ii) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, would suffice.
We find that as regards the penalty under Regulation Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, considering the revocation of the Courier license, since September 2023, a lenient view can be taken. Thus, the penalty imposed on the appellant under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 is reduced to Rs. 25,000/-.
In the result the impugned order is modified and appeal is partially allowed by setting aside revocation of Courier License and enforcement of Bond and Bank Guarantee executed in connection with the Registration/Issue of Courier License. In view of the discussion at Para 9 (supra), penalty imposed on the appellant u/s 117 of the Customs Act, 1962 is set aside. The penalty imposed on the appellant under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 is reduced to Rs. 25,000/-(Rupees Twenty Five Thousand only)
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2024 (5) TMI 77 - CESTAT BANGALORE
Levy of penalty for abetting in mis-declaration of imported goods - Revocation of Courier License - authorized courier agent - mis-declaration of the value - Shipment without proper KYC verifications and authorization of the import - violation of the provisions of Courier Imports and Exports (Electronic Declaration and processing) Regulations, 2010 - HELD THAT:- As the appellant is only facilitating the customs transaction on behalf of principal, (importer/exporter), the absence of mens-rea, penalty is not imposable, otherwise all the customs transaction will come to halt, if penalty is imposed on the customs broker the omission /commission of exporter/importer. Moreover, in the impugned order Adjudication Authority itself held that there is no illegality revealed related to goods cleared through the appellant.
Appellant has not received any authorization for filing the courier bills of entry. However, while submitting reply to show cause notice, appellant submits that the importer is identified and appellant had caried out KYC verification such as IEC and GST registration as per information provided by Mr. Ajit. Moreover, the appellant produced Email communication as proof of authorization and thereby complied with the KYC verification. The absence of any provision which mandate receipt of KYC directly by courier agency u/s 146 of Customs Act,1962, finding of violation of the Regulation 12(i) is unsustainable.
The bills of entry were filed by G Card holder Shri. V.V. Suresh, who is an authorized person to file bill of entry as per section 146 of Customs Act,1962. Thus, in the absence of any evidence regarding filing of bill of entry by Shri. I. S. Patil and not ‘G’ Card holder Shri. V. V. Suresh, violation of the Regulation 12(ii) is unsustainable as held by the adjudicating authority.
As regards violation of the Regulation 12 (iv) & (vi) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, the adjudicating authority held that the delivery address of the importer is in Delhi and appellant has not verified the identity of the client by using reliable, independent document. Moreover, even as per the allegation in the SCN, there is no import of prohibited/restricted goods and there is no allegation related to goods cleared by appellant.
Thus, appeal is allowed by setting aside revocation of courier license and enforcement of Bond and Bank guaranty executed in connection with registration/license. Penalty imposed on the appellant u/s 117 of the Customs Act, 1962 is set aside. Penalty imposed on the appellant under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 is also set aside.
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2024 (5) TMI 76 - CESTAT KOLKATA
Levy of maximum Penalty - delay in submitting the documents for finalization of the Bills of Entry - Duty paid on provisional basis - HELD THAT:- Admittedly the Department has not brought in any evidence to the effect that the Appellant has deliberately delayed the finalization of the Bills of Entry. On a query from the Bench, the Ld. Consultant submits that even in respect of the 12 Bills of Entry in question, the finalization has been completed and there is no pendency on their side.
Therefore, following the ratio of the decision in the case of Jai Balaji Industries Ltd.,[2021 (1) TMI 767 - CESTAT KOLKATA], I set aside the impugned Order and allow the Appeal.
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2024 (5) TMI 22 - CESTAT NEW DELHI
Mis-declaration of Mud additive chemicals for oil well - Confiscation - Valuation - Payment of redemption fine - Penalty - denial of the cross examination by the Commissioner - Relevancy of statements u/s 138B - HELD THAT:- It is a well-settled legal position that unless the statements have been put through the process prescribed u/s 138B, they are not relevant at all to prove the case. By not following the procedure prescribed in section 138B, the Commissioner has rendered all the six statements (RUD- 4 to RUD-9) irrelevant to prove the case.
The only other important document is the test report of the CRCL. Shri Singhal’s assertion was that what was attempted to be exported was Mud Additive Chemical and according to the CRCL, it was urea. Therefore, if Shri Singhal wanted to cross examine the chemical examiner who had tested the sample and said that it was urea, it is but just and proper. However, the Commissioner denied cross examination.
Once all the statements and the test report of CRCL are ignored, nothing survives in this case and the impugned order cannot be sustained.
To sum up: (a) By not following the procedure prescribed under section 138B, the Commissioner rendered all the six statements relied upon in the SCN irrelevant to the case;
(b) By denying cross examination the Commissioner has also rendered the test report of CRCL irrelevant to prove the case of the department.
(c) De hors the statements and the test report of the CRCL, nothing survives in the impugned order.
Thus, all three appeals are allowed and the impugned order is set aside insofar as it pertains to Shri Singhal, Shri Bharadwaj and Shri Jindal.
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2024 (5) TMI 21 - CESTAT NEW DELHI
Classification - Import of ‘Accordion springs’ - Demand duty - Interest - Penalty - benefit of exemption Notification - Whether the ‘Accordion springs’ imported by the appellant are ‘leaf springs’ classifiable under Customs Tariff Item [CTI] 7320 10 11 as claimed by the appellant or as ‘other springs under CTI 7320 90 90 - HELD THAT:- We find that ‘Accordion Springs’ imported by the appellant are neither helical springs nor leaf springs and are a category of springs in themselves. They are also sold as ‘Accordion springs’ only and not as leaf springs or helical springs. Therefore, they fall under the Customs six digit heading of 7320 90 ‘Other’. Under this, there are three eight digit Customs Tariff Items and since these do not fall under the categories of coil springs for railways (7320 90 10) or spring pins (7320 90 20), they fall under the residual category of CTI 7320 90 90. We, therefore, find in favour of the Revenue and against the appellant on the question of classification.
Thus, the appeal is dismissed and the impugned order is upheld.
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2024 (5) TMI 20 - CESTAT MUMBAI
Seeking amendment of the Shipping Bills in terms of Section 149 of the Customs Act, 1962 - Jurisdiction of the First Appellate Authority - Whether decision or order passed by an officer of Customs, lower in rank than a Commissioner of Customs, can only be appealed against before the Commissioner (Appeals) and not otherwise - HELD THAT:- On perusal of the letter dated 09.06.2022 addressed by the Assistant Commissioner of Customs to the appellant, we find that though the said letter was signed by him, but the views of the Administrative Commissioner of Customs was conveyed that the request for amendment/conversion of shipping bills cannot be adhered to. Thus, we are of the considered opinion that the decision for rejection of the letter of appellant, seeking amendment of shipping bills was taken by the Commissioner of Customs and not by the officer lower in rank than him.
Since, the Administrative Commissioner has communicated the view regarding non-entertainment of the application for amendment of the Shipping Bills, the order or decision passed by him cannot be appealed against before the Commissioner (Appeals) in terms of Section 128 ibid, wherein, it has been mandated that decision or order passed by an officer of Customs, lower in rank than a Commissioner of Customs, can only be appealed against before the Commissioner (Appeals) and not otherwise.
Therefore, we are in agreement with the order passed by the learned Commissioner (Appeals) that he has no jurisdiction to entertain the appeal against the decision of the Administrative Commissioner. Accordingly, we do not find any infirmity in the impugned order, and thus dismiss the appeal filed by the appellant.
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