TMI Blog2017 (9) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... proper officer has allowed them to be cleared. It is the appellant-Company, the importer himself has discovered the error and brought it to the notice of the proper officer by way of written representation and they have made the payment of duty leviable on such goods together with interest under Section 28 thereon. Therefore, there is no manifest intention on the part of the importer to evade duty - The present case is not a case where the goods have been imported in excess of their numbers mentioned in the Bill of Entry. The import manifest has not been filed covering certain goods amongst other goods imported. However, they were cleared without levying any duty on them. The lapse is equally on the part of the proper officer, who cleared those goods, without verifying as to whether an appropriate Bill of Entry is lodged or not and then they have suffered the incidence of duty or not - The role and jurisdiction assigned to the Tribunal is specified under Section 129-B of the Act. It would be open for the Tribunal, if it thinks fit, to pass an order confirming or modifying or annulling the decision appealed against or may refer the case back to the authority with such direction as i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Crishnan For the Respondents : Mr. T. Pramodkumar Chopda, Senior Standing Counsel JUDGMENT Nooty. Ramamohana Rao, J. This appeal is preferred by the assessee against the final order rendered by the Customs, Excise and Service Tax Appellate Tribunal in Final Order No.1670 of 2009, dated 11.11.2009. 2. The Civil Miscellaneous Appeal was admitted by this Court on 22.09.2011 on the following substantial questions of law: (i) Whether the order of the Tribunal directing levy of penalty under Section 112(a) of the Customs Act, is without jurisdiction and amounts to trenching upon the powers of the adjudicating authority, inasmuch as the power to levy penalty is vested with the adjudicating authority under the Customs Act and the definition under Section 2(1) of the Customs Act, 1962, expressly excludes the Tribunal ? (ii) Whether the order of the Tribunal directing levy of penalty under Section 112(a) is bad for want of jurisdiction, inasmuch as the above direction amounts to enhancement, for which there is no power under Section 129-B of the Customs Act, 1962, and is thus contrary to the decision of this Court in 1983 (54) STC 62 (Madras) (P.Hajee Mohamed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , to the Tribunal. The Tribunal, by its order dated 11.11.2009 in Final Order No.1670 of 2009, has arrived at a finding that proviso to Section 114-A of the Customs Act, is not attracted in the facts and circumstances of the present case, as the appellant-Company has voluntarily disclosed the information after they discovered the mistake and paid the duty and interest in respect of the imported goods, cleared but not covered by the Bills of Entry filed by them. The Tribunal has confirmed the redemption fine of ₹ 3 lakhs and set aside the penalty imposed under Section 114-A of the Act, and directed that penalty of ₹ 1 lakh be imposed on the appellant under Section 112(a) of the Act, as the show cause notice issued to the appellant has adverted to the same. The appeal was otherwise rejected by the Tribunal. The present C.M.A. has been directed against the above order passed by the Tribunal. 4. Before we traverse in detail as to the nature of the redemption fine, contemplated and provided for under Section 125 of the Customs Act, it would only be appropriate to notice relevant provisions under the Customs Act. In Section 2, various expressions found mentioned in the Cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount specified in the notice. Under Section 30, the person-in-charge may deliver to the proper officer the import manifest and he shall duly verify as to the proof of the contents of the imported goods, prior to the arrival of a Vessel or air-craft. Under Section 32, no imported goods, required to be mentioned in an import manifest, except with the permission of the proper officer, be unloaded. As per Section 45 of the Act, all imported goods unloaded in a customs area, shall remain in the custody of the person approved by the Commissioner of Customs until they are cleared. 7. Under Section 46(1) of the Act, the importer of goods, other than those intended for transit or transhipment, shall make an entry thereof in a Bill of Entry presented to the proper officer for home consumption or warehousing purpose. Under sub-section (4) thereof, the importer was also required to produce the invoice if any relating to the imported goods. Under Section 47(1) of the Act, where proper officer is satisfied that the goods entered for home consumption are not prohibited goods, and the importer has paid the import duty assessed thereon and the charges if any payable under the Act in respect o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble or prohibited goods removed from a custom area or a warehouse, without the permission of the proper officer or contrary to the terms of such permission (clause j); (iii) any dutiable or prohibited goods which are not included or are in excess of that those which are included in Entry made under the Act, or in case of baggage in the declaration made under Section 77 of the Act (clause l); (iv) Any goods exempted, subject to any condition, from duty or any prohibition in respect of the import thereof under the Act, in respect of which condition is not observed, unless the non-observance of the condition was sanctioned by the proper officer (clause O). 10. Thus, Section 111 of the Act has provided for a far-reaching consequence of confiscation of the goods imported into India. Analysis of the various clauses contained under Section 111 of the Act, clearly brings out that the prohibited goods which are imported, are one such class of goods which are liable to be confiscated. Similarly, the goods which have been imported in excess of those mentioned in the import manifest, or not mentioned in the import manifest, are also liable to be confiscated. Similarly, any impor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... however, without levying any duty thereon at the first instance, the proper officer has allowed them to be cleared. It is the appellant-Company, the importer himself has discovered the error and brought it to the notice of the proper officer by way of written representation and they have made the payment of duty leviable on such goods together with interest under Section 28 thereon. Therefore, there is no manifest intention on the part of the importer to evade duty. The present case is not a case where the goods have been imported in excess of their numbers mentioned in the Bill of Entry. The import manifest has not been filed covering certain goods amongst other goods imported. However, they were cleared without levying any duty on them. The lapse is equally on the part of the proper officer, who cleared those goods, without verifying as to whether an appropriate Bill of Entry is lodged or not and then they have suffered the incidence of duty or not. 14. In those circumstances, no inference can be drawn against the importer-Company that they have made an attempt to evade the incidence of duty payment all due to mis-statement of fact or such similar reason. Therefore, very righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Bar, it is only appropriate to re-produce Section 125 hereunder: Section 125: Option to pay fine in lieu of confiscation:-- (1) Whenever confiscation of any goods is authorised by this Act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall, in the case of any other goods, give to the owner of the goods or where such owner is not known, the person from whose possession or custody, such goods have been seized, an option to pay in lieu of confiscation such fine as the said officer thinks fit: Provided that, without prejudice to the provisions of the proviso to sub-section (2) of section 115, such fine shall not exceed the market price of the goods confiscated, less in the case of imported goods the duty chargeable thereon. (2) Where any fine in lieu of confiscation of goods is imposed under sub-section (1), the owner of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges, payable in respect of such goods. 18. The principal contention that is canvassed before us is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave noticed supra, certain classes of goods can be prohibited from being imported by the Central Government by a Notification. If an importer, in contravention thereof, imports any such goods, the only option that is available to a proper officer in such cases, is not to clear such goods for home consumption. When once importation of goods is prohibited, there is no way that they can be cleared for home consumption, otherwise, the very object of prohibiting their import by way of the Notification by the Central Government, gets completely frustrated or neutralised. Further, without levying the duty under the Customs Act, no clearance thereof can be granted under the Act, and when once certain goods are prohibited from being imported, the question of levy of duty thereon would not simply arise and hence, such goods cannot be cleared for home consumption. 21. We are, therefore, of the opinion that insofar as the prohibited goods are concerned, they are prevented from being imported either absolutely or conditionally and consequently, the question of making an offer for payment of fine under Section 125 of the Act, would not arise, without studying the implication of such import. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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