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2013 (9) TMI 65 - AT - CustomsMis-use of IE code – Confiscation of goods u/s 113(d) & (i) - Smuggling of sanders wood logs under the guise of machinery parts – Held that:- There was omission on the part as a result of which the container provided by them was misused for the smuggling of red sanders, which was a banned item for export - If somebody else misused their IEC code, the responsibility for the same cannot be passed on to the appellants – relied upon PRAKASH FREIGHT MOVERS LTD. Versus COMMISSIONER OF CUS., CHENNAI (2009 (10) TMI 741 - CESTAT CHENNAI) - in the absence of any knowledge about the mis-use of IE code and lack of involvement in facilitating such mis-use, penalty cannot be imposed under section 114 - penalty on the appellant was not sustainable. Penalty on CHA - Penalty u/s 114(i) - Held that:- There was no omission and commission on their part so as to attract the provisions of Section 114 (i) - the statute does not envisage monitoring of the import/export transactions on a daily basis and bringing any discrepancy to the notice of the Customs authorities - in the absence of any evidence establishing the involvement of the appellant in the smuggling of red sander wood logs – it can be invoked only when any person, who in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation u/s 113 or abets the doing or omission of such an act - There was no such allegation against the appellant either in the show cause notice or in the order. - There was only an omission on their part in ascertaining the genuineness of the transaction and obtaining proper authorization. - Penalty reduced from Rs. 130 lakhs to 1 lakh. Penalty on freigh forwards - Held that:- the negligence on their part is very evident. They undertook the transaction on the basis of e-mail received from Shri Manoj Vichare of M/s. Sara logistics. The did not verify whether M/s. Sara Logistics existed at all. Being a freight forwarder, they are expected to know the existence or otherwise of M/s. Sara Logistics, which is also in the same business. However, the fact is that M/s Sara Logistics did not exist at all. They were not vigilant about the probable misuse of the container and the seal provided by them by unscrupulous elements. - Penalty reduced from Rs. 130 lakhs to 1 lakh.
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