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2023 (5) TMI 50 - AT - CustomsLevy of Redemption Fine and penalty u/s 112(a) of Customs Act - Rejection of refund claim - rejection on the ground that the appellant did not challenge the assessment order which has become final - goods CTH 72163200 is eligible for concessional rate of duty @5% as per Sr. 190B of Notfn No.21/2002-Cus or not - HELD THAT:- The SCN was waived and enhancement of value was accepted by the appellant only, while seeking clearance of the goods. There are merit in the submission made by the appellant, on the point of action in personam, that the Commissioner should not have imposed penalty under Section 112(a),while giving finding of the non- imposition of penalty under Section 114A, due to lack of mens rea. Such a course of action could have only been done by affording full opportunity to the appellant, including in relation to justification or otherwise of quantum of penalty, which as per records does not appear to be the case. Even under section 128 A(3) cited in the impugned order, Commissioner (Appeals) while deviating from show cause notice/Order-In-Original is required to do natural justice based inquiry before doing modification of this nature. Imposition of penalty u/s 112(a) therefore does not appear proper in the facts of this matter. Since the goods imported were in the nature of offending goods having been mis-described in the Bill of Entry, the action in rem is still required to be legally scrutinised. It is a fact that, while imposing redemption fine no market inquiry to arrive at the correct quantum was done. The higher side of the imposable redemption fine as per Section 125 of the Customs Act, 1962 is dependent upon such determination. However, with in this highest limit, redemption fine as a norm can be imposed to nullify profit likely to be earned through goods held liable to be confiscated - the statutory course of ascertaining the market price and reducing it by duty chargeable may not be feasible. However, the transaction value taken by the department and accepted by the appellants seeking release of goods was taken of Rs. 47 Lakhs approximately and as against this, the declared value was of Rs. 22 Lakhs and appellant had paid the total duty of approx. Rs. 12 Lakhs. The Commissioner (Appeals) has accepted that there has been a mistake and not deliberate misdeclaration. Since, the matter pertains to year-2008, the remand at this stage may not serve any useful purpose. As the facts of the matter indicate a wrong dispatch, but the goods were eventually cleared at the behest of the appellants who agreed to take the release of goods even at the enhanced value, indicates that margin of profit even after paying duty was present - the redemption fine is reduced to Rs. 4 Lakhs - the penalty of Rs. 4 Lakhs imposed under Section 112(a) by the order of Commissioner (Appeals) is set aside - appeal allowed in part.
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