2008 (11) TMI 694 - HC - Customs

Tribunal decision upheld in customs case challenging deposit amount reduction & penalty waiver under Article 226.

The High Court upheld the Tribunal's decision in a customs case, dismissing the petition challenging the reduction of the deposit amount and waiver of ... Pre-deposit - penalty - reduction in quantum of - Held that: - the Tribunal has taken lenient view in favour of the petitioner by asking him to deposit ₹ 2 crores - The learned counsel for the petitioner also failed to point out any financial hardship in order to substantiate his say that the amount of pre-deposit should be reduced - appeal rejected - decided against appellant. Issues:Challenge against Tribunal's order reducing deposit amount and waiving penalty in customs case.Analysis:The High Court considered a petition challenging the Tribunal's order that allowed the petitioner to deposit a reduced amount of Rs. 2 crores instead of the original penalty amount of Rs. 4,90,93,914 and also waived the penalty. The Tribunal had provided cogent reasons for its decision, taking a liberal view in favor of the petitioner. The Court noted that the Commissioner of Customs had also given cogent reasons in the original order, highlighting various observations related to the case.The Court examined the details presented in the Commissioner's order, including the consistency in declared prices over multiple import transactions, evidence of a special relationship between the buyer and seller, discrepancies in declared CIF value compared to actual freight paid, discrepancies in invoicing terms, the reputation of the imported brands, suspicious financial transactions, and non-disclosure of relationships as required by customs rules.Ultimately, the High Court found that the Tribunal had already taken a lenient view by reducing the deposit amount to Rs. 2 crores. The petitioner's counsel failed to demonstrate any financial hardship justifying a further reduction. The Court concluded that this was not a case warranting interference under Article 226 of the Constitution of India. Therefore, the Court upheld the Tribunal's order, finding no infirmity in it.In summary, the High Court dismissed the petition challenging the Tribunal's decision to reduce the deposit amount and waive the penalty in a customs case. The Court found that the Tribunal had provided valid reasons for its decision and had already taken a lenient view in favor of the petitioner. The Court declined to interfere further, upholding the Tribunal's order as it did not find any flaws in it.