2010 (9) TMI 943 - Commission - Customs

Summary

Issues Involved:
1. Confiscation of goods
2. Imposition of penalty
3. Settlement of customs duty
4. Interest liability
5. Fine and redemption fine
6. Immunity from prosecution

Issue-wise Detailed Analysis:

1. Confiscation of Goods:
The applicant, M/s. Sanghvi Electronics Pvt. Ltd., and the co-applicant, Shri Suresh Sanghvi, were involved in the import and trading of computer parts. Upon examination of a consignment, customs officers discovered undeclared goods including 398 mobile phones and 100 computer hard discs concealed within computer cabinets. A subsequent search of the applicant's godown revealed additional undeclared goods. The Show Cause Notice (SCN) issued on 20-1-04 called for the confiscation of these goods under Section 111(i) and (m) of the Customs Act.

2. Imposition of Penalty:
The SCN also proposed penalties under Section 112(a) of the Customs Act for the smuggling of mobile phones and computer hard discs. The applicant and co-applicant admitted to the duty liability but sought immunity from penalties and prosecution. The Settlement Commission initially imposed penalties but the case was remanded by the Hon'ble Bombay High Court for re-evaluation.

3. Settlement of Customs Duty:
The Settlement Commission settled the customs duty at Rs. 4,06,224/-. This amount was to be appropriated from the sale proceeds of the seized goods. The applicant was required to deposit any shortfall within 30 days.

4. Interest Liability:
The Commission ordered the applicant to pay simple interest at 10% per annum on the unpaid customs duty from the date it was due until the duty is paid. The interest liability was calculated up to the date of the earlier order (4-5-06), amounting to Rs. 1,18,933/-. The applicant was directed to deposit this amount within 30 days.

5. Fine and Redemption Fine:
The Commission observed that the applicant attempted to smuggle goods by concealing them within declared imports. The assessable and market values of the smuggled goods were detailed, and fines were imposed accordingly. A penalty of Rs. 1,00,000/- each was imposed on the applicant and co-applicant under Section 112(a). Additionally, a redemption fine of Rs. 7,00,000/- was imposed on the applicant for the 700 mobile phones cleared earlier and not available for confiscation. These amounts were to be adjusted against the deposits already made by the applicant.

6. Immunity from Prosecution:
The applicant sought immunity from prosecution, arguing that they had made a true disclosure and cooperated throughout the proceedings. The Commission granted full immunity from prosecution under the Customs Act for this case, considering the applicant's conduct and the lack of evidence supporting the claim of habitual offending by the Revenue.

Conclusion:
The Settlement Commission's order included the settlement of customs duty, imposition of interest, fine, and penalties, and granted immunity from prosecution. The applicant was required to comply with the financial obligations within specified timelines, and the order was subject to voidance if obtained by fraud or misrepresentation.