2023 (9) TMI 1263 - CESTAT ALLAHABAD

Absolute Confiscation - penalty u/s 114AA of FA - concealment of gold bars shoes and socks - restricted goods or prohibited goods - HELD THAT:- The sections under which the gold has been held liable for confiscation are the sections in which the goods become prohibited for the reason of misdeclaration or any other violation of the provisions of Custom Act,1962. Thus adjudicating authority has held that the gold does not fall under the category of prohibited goods for the reasons of prohibition imposed under Custom Act or any other law, but the confiscation is for the case of non-declaration or miss-declaration of the same to the Customs Authorities by the passenger in an appropriate manner - in such cases the gold could have been allowed to be redeemed by the appellant on payment of redemption fine. In the case of COMMISSIONER OF CUSTOMS (PREVENTIVE) , JODHPUR VERSUS MEHBOOB [2022 (2) TMI 1391 - RAJASTHAN HIGH COURT] Hon’ble Rajasthan High Court has analyzed the various provisions of the Customs Act.

The appellant should have been given an option to redeem the goods against the redemption fine. Accordingly, the absolute confiscation made as per the impugned order will have to be modified to the extent of allowing the goods to be redeemed on payment of redemption fine of Rs.5 lakhs (Rupees Five Lakhs Only). In case appellant redeems the goods he is also required to pay Customs duties as applicable as per Section 125 (2) of the Customs Act. Since the case under consideration is a case where the goods sought to be imported as baggage, the applicable rate of duty will be the baggage rate of duty, which is much higher than the normal rate of duty applicable to the same goods.

Penalty u/s 114AA of CA - HELD THAT:- From the plain reading of Section 114AA it is evident that penalty under this section can be imposed on a person who intentionally makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document which is false or incorrect in any material particular for the transaction of any business under the Customs Act, 1962 - In the present case nothing has been brought on record by which it can be said that the appellant had made or caused to be made any declaration/ used or caused to be used any statement or document which is false or incorrect. In the present case the appellant carrying the Gold has in fact not made any declaration to the Custom Authorities as required under the Custom Act, 1962. No document etc., which has been produced by him which has been produced by him was found to be materially wrong. As the ingredients for invocation provisions of Section 114AA are absent in the present case penalty under the said section is not justified - the penalty imposed under Section 114AA of the Customs Act is set aside.

The impugned order modified to the extent of setting aside the absolute confiscation and allowing the option to redeem the confiscated gold bars against payment of redemption fine of Rs 5,00,000/- (Rupees Five Lakhs) along with the baggage rate of duty as applicable and setting aside the penalty imposed under Section 114AA.

Appeal allowed in part.