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2016 (1) TMI 512 - CESTAT MUMBAI

2016 (1) TMI 512 - CESTAT MUMBAI - 2016 (335) E.L.T. 534 (Tri. - Mumbai) - Levy of penalty on courier agency on the ground that they have failed to exercise due diligence in performing their work as an authorized courier and thus, their inaction/negligence has led to this attempt of smuggling of costly goods in the guise of low value spare parts. - Held that:- the appellants are a Courier Company and in ordinary course of business they do not come to know about the factual desertion of the goods .....

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and therefore no allegation made for failure to observe the obligation under regulation 13(b) can be made. - However, regulation 13(c) provides for a very wide scope. - The appellants were required to exercise due diligence. The fact that the weight of consignment was 22 kg and the freight was ₹ 25,000/- but the declared value was less than ₹ 3000/- should have raised suspicion. Therefore, it is felt that it was possible for the appellant to exercise due diligence in respect of .....

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Adv For the Respondent : Shri D S Maan, AC (AR) ORDER Per Raju The appellant is a courier company. The facts of the case are that the Applicant filed a courier Bill of Entry wherein the description of the goods was declared as Spare Parts and value was declared as ₹ 2934/-. On preliminary examination of the package revealed that it contained two sets of ARRI Alexa Camera (Made in Germany) and 10 pcs of memory cards 32 GB(Made in Japan). It appeared that there was mis-declaration of goods .....

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odules each valued at approx. ₹ 50,000/-, thus totally valued at approx. ₹ 5 Lakhs (CIF). Goods valued at ₹ 65 Lakhs were seized. After issuance of show cause notice and considering reply from the noticees including the present Appellant and hearing the parties, the Ld. Commissioner adjudicated the show cause notice vide the impugned order wherein amongst other confirmation, he imposed penalty of ₹ 1,00,000/- upon the Applicant on the ground that they have failed to exerc .....

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contravenes any provision of this Act or abets any such contravention or who fails to comply with any provision of this Act with which it was his duty to comply, where no express penalty is elsewhere provided for such contravention or failure, shall be liable to a penalty not exceeding one lakh rupees." The learned Counsel argued that penalty under Section 117 can only be imposed when a person contravenes any provisions of the Act or abets any such provision or fails to comply the provision .....

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xports (Clearance) Regulations, 1998 and the Customs Act, 1962 which have rendered such goods liable to confiscation under Section 111 of the Customs Act, 1962, Customs Act. As regards the proposal for penal action against them under Section 112 and 114AA ibid, I find that the investigation could not unearth any concrete evidence regarding their knowledge of the mis-declaration of the goods under seizure and their connivance in the attempt for evasion of duty. Therefore penal action under Sectio .....

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was 22 kg but the value declared was less than ₹ 3000/-. The freight charges for the consignment was ₹ 25,000/- and these facts should have automatically made the appellant suspicious of the consignment. He argued that the appellant failed in his obligation prescribed under Regulation 13(a), 13(b), and 13(c). Such obligation of the authorized courier under Regulation 13 are as follows:- "13. Obligations of Authorised Courier. An Authorised Courier shall - (a) obtain an authorisa .....

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very of the consignments to consignee. (b) advise his client to comply with the provisions of the Customs Act, 1962 (52 of 1962) and rules and regulations made thereunder and in case of non-compliance thereof shall bring the matter to the notice of the Assistant Commissioner of Customs or Deputy Commissioner of Customs; (c) exercise due diligence to ascertain the correctness and completeness of any information which he submits to the proper officer with reference to any work related to the clear .....

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