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TMI Blog2024 (10) TMI 1410X X X X Extracts X X X X X X X X Extracts X X X X ..... were seized on 24.05.2018. The importer vide letter dated 04.06.2018 requested for provisional release of goods which was accepted by the learned Commissioner on 19.06.2018 subject to submission of bond for the assessable value of goods along with Bank Guarantee of total duty involved plus 25% of assessable value i.e. Rs. 88,61,690/-. Thereafter, the importer submitted the bond as asked for with Bank Guarantee dated 23.07.2018 for Rs. 32,16,245/- and deposited customs duty of Rs. 26,47,624/- along with interest of Rs. 89.211 [qua B/E No. 6226233 dated 03.05.2018) and Rs. 30,78,821/- along with interest of Rs. 1,01,359/- [qua B/E No. 6226269 dated 03.05.2018] on 15.10.2018. Further, 15% of penalty of Rs. 8,48,318/- (15% of Rs. 56,55,445/-] deposited on 25.10.2018 by the importer. Based on the afore-said allegations, a show cause notice dated 25.01.2021 was issued to the importer and co-noticee asking as to why customs duty of Rs. 56,60,702/- should not be demanded along with interest and why penalty should not be imposed on the importer and other co-noticees'. 2. The appellants contested the show cause notice by denying all allegations levelled against them. The importer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... UCH NEITHER BENEFIT OF NOTIFICATION CAN BE DENIED NOR REDEMPTION FINE CAN BE IMPOSED NOR PENALTY CAN BE IMPOSED: It is respectfully submitted that, if show cause notice is pre- mature as held by the learned Commissioner, then the entire show cause notice is liable to be quashed. It is further submitted that the learned Commissioner erred in holding against the appellant by denying the benefit of Notification No. 52/2003-Customs dated 31.03.2023 and rejecting the classification, quantity and description of the goods when according to him final assessment has not been done. It is further submitted that when according to the learned Commissioner final assessment has not been done and show cause notice is pre-mature, then imposition of redemption fine and penalty are liable to be set aside. Reliance is placed on the following judgements: * Saharsh Distributors Pvt. Ltd. Vs Commissioner of Cus, New Delhi, 2017 (354) ELT 671 (Tri-Del.) * Kevin Infotech (P) Ltd. Vs Commissioner of Customs (Port), Kolkata, 2007 (216) ELT 435 (Tri-Kolkata) * A.S. Syndicate (Warehousing) P. Ltd. Vs Commissioner of Customs (Port), 2011 (267) ELT 469 (Cal.) * Deep Jyoti Wax Traders Pvt. Ltd. Vs Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al were made after provisional release. Relevant paras of the Show Cause Notice in which this request has been recorded are as under: (a) Para 1.9 Last point of the para clearly mentions that the appellant vide letter dated 25.10.2018 requested to finalize the Bill of Entry. (b) Para 2.23/Para 3.74 M/s KIPL vide their letter dated 01.06.2020 requested for final assessment and to release the Bank Guarantee. 4.3 The letter dated 25.10.2018 is also available in case file at page number 198. The last line clearly mentions the request to finalize the Bill of Entry. Further, a letter dated 15.11.2018, submitted by the appellant to the Di, Gandhidham regional Unit is also available in case file at page number 201. This letter also requests to finalize the Bill of Entry. Therefore, as admitted by the appellant many times, the assessment of the Bills of Entry remained provisional. It was not just a provisional release but a provisional assessment also. The same fact has been recorded by the adjudicating authority in para 4.4 of the O-1-0. Though "Provisional Release" and "Provisional Assessment" are two independent concepts, in the instant case both are present. Whether Section 28 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 124. Relevant portion of para 9 is reproduced below: 9. Both confiscation and provisional release arise in the aftermath of seizure under Section 110 of Customs Act, 1962. The scope for, and limits on, confiscation under Section 111 of Customs Act, 1962, and, thereby, of redemption fine, stand settled by the decision of the Hon'ble Supreme Court in Weston Components Ltd. v. Commissioner of Customs, New Delhi (2000 (115) ELT. 278 (S.C.)) and of the Hon'ble High Court of Bombay in Commissioner of Customs v. Finesse Creation Inc. [2009 (248) E.L.T. 122 (Bom)). Provisional release under Section 110A of Customs Act, 1962 does not, in any way, impede completion of adjudication proceedings commenced under Section 124 of Customs Act, 1962 and is to be invoked upon seizure with due acknowledgement of legislative intent to which we may now bring our attention to bear. Further para 20 of the judgment refers to the order in Pushpak Lakhani v. Commissioner of Customs (Preventive), New Delhi (Final Order No. 50001/2022] issued by Hon'ble Principal Bench, CESTAT, Delhi which established framework within which the adjudicating authority may exercise discretion after seizu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 125 originate after issuance of Show Cause Notice under Section 124 which provides that confiscation of goods requires a SCN under this section. In the instant case, goods were found mis-declared and hence seized under Section 110. Bills of Entry were amended and provisional release was granted under Section 110(A), as has been discussed above, assessment remained provisional. Show Cause Notice proposed rejection of self assessment and then re-assessment. The Show Cause Notice also mentions as to why the goods should not be confiscated under Section 111 of the Customs Act, 1962. Till here all elements for Section 124 to become operative are present. A natural consequence of a Show Cause Notice issued under Section 124 would be adjudication under Section 125. Section 28(4), if at all, can be considered to be present in the Show Cause Notice as an extra section which was not required to be invoked since the assessment was provisional. Mere mentioning Section 28(4) in the Show Cause Notice does not take away the right of adjudicating authority to conclude the proceedings under Section 125 when all the essential elements required to enforce it are present. Had Section 124 bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods is to be done under Rule 11 read with Rule 9 of the CEVR. On the legal proposition advanced by Learned ASG, we readily affirm that citation of an incorrect source of power does not vitiate the exercise of the power itself provided the power vests in the authority to begin with." Thus, in view of the above judicial pronouncements, mentioning of a wrong provision ie. Section 28(4) and not mentioning of correct section i.e. Section 124 does not vitiate the proceedings till the adjudicating authority has the power to pass an order under Section 125 which is unquestionably present with the adjudicating authority. 4.9 Apart from Section 28(4), the other main contention of the appellant is that since goods were released provisionally and were not available, redemption fine cannot be imposed. For this, the judgment relied upon by revenue is the judgement issued in KAY BEE TAX SPIN LTD. 2017 (349) E.L.T. 451 (Guj.) by Hon'ble High Court of Gujarat. It has been held that when the goods are released under bond, RF can be imposed under section 125 since RF is in lieu of confiscation of goods and not in lieu of goods. When the goods are liable for confiscation, RF should be imposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (AA) and 117; or alternatively, the case may be remanded back to the adjudicating authority to determine and impose penalties under Section 114(AA) & 117 of the Customs Act, 1962. 6. We find that the department is not in appeal at this stage and has tried to make a fresh case for imposition of penalty against the appellants. We find that in the instant case the appellants party had deposited the remaining duty+interest+15% penalty so as to be eligible for claim for amnesty. We find in the show cause notice duty has been demanded under Section 28 (4) of the Customs Act, 1962 in para 9.1 (e) along with interest under Section 28AA of the Customs Act, 1962. Simultaneously, we find that confiscation has also been proposed and has been upheld. Learned Advocate has disputed that the assessment was provisional and has only pointed out that the goods were released provisionally after seizure. The findings at para 4.4 on page 48 as reproduced above in the submissions of the department at para 4.1 are relevant. We find that it is not coming out clearly as to whether the goods were provisionally released or assessment were done provisionally as the former relates to seized goods and later in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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