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2024 (1) TMI 1220 - AT - CustomsLevy of penalty under Regulation 18 (1) of the CBLR 2018 - failure to comply with the obligations mandated under Regulation 10 (d) and 10 (e) of CBLR 2018 - misclassifying ‘Match Skillets’ exported by them under CTH 36050090 instead of under CTH 48192010 - HELD THAT:- The stand of the appellant from the very beginning was that CTH adopted by the appellant was based on the assessment practice for Match Skillets made out of white board. The appellant has also given justification for the said classification. Further, it is found that the assessing officers were well aware of the classification and they allowed the said classification without any objection. The respondent did not raise any objection to the adopted classification even though the description of the export goods was correctly declared. Further, it is not only the appellant who has followed this classification with regard to impugned goods rather other exporters were also adopting the same classification which was followed at Tuticorin port during the period from April 2015 to October 2020. The Commissioner in the impugned order has held that the appellants are not directly benefited by their contravention hence there is no mens rea on the part of the appellant and therefore the imposition of penalty on the appellant for violation of Regulation 10 (d) and 10 (e) of CBLR 2018 is not warranted. Further, it is settled law that the classification is a question of law and cannot be treated as misdeclaration or misstatement. Once it has been observed by the learned Commissioner that there is no mens rea on the part of the appellant then in that case imposition of penalty of Rs.25,000/- for violation of Regulation 10 (d) and 10(e) of CBLR 2018 is not sustainable in law. Therefore, the penalty imposed on the appellant is set aside - appeal allowed.
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