2011 (1) TMI 821 - CGOVT - Customs

Challenged delay in adjudication order timing upheld, Shipping Agent liable for LCL container, Customs burden of proof affirmed.

The Revision Application challenged the delay in issuing the adjudication order, with the Government finding no fault in the timing of the Show Cause ... Revision application under Section 129DD - Imposed penalty under Section 116 of the Customs Act, 1962 - Short Landing of Goods - The Government is convinced that any Loading arrangements from consigner side can not have a binding effect for nature/category of the containers and that the cargo was de-stuffed from LCL Container therefore as per Bombay High Court’s Order in the case of M/s. Shaw Wallace[1986 -TMI - 41750 - HIGH COURT OF JUDICATURE AT BOMBAY], guidelines has been issued for the Customs authorities exercising powers under Section 116 of Customs Act, 1962 - New Custom House also issued Public Notice No. 50/92 following these guidelines that - “Regarding LCL Containers-that if the seal is intact at the time of discharging and de-stuffing of container than the carrier should be responsible for the difference between the manifested quantity and the de-stuffed tally - In the present case, it was a LCL container therefore the Shipping Agent is liable for action under Section 116 of Customs Act, 1962 - Thus, the Revision Application is allowed. Issues:1. Delay in issuing the adjudication order.2. Nature of the impugned container - LCL or FCL.3. Reliance on amended out-turn report.4. Burden of proof on the Customs.5. Applicability of cited precedents.6. Responsibility of the shipping agent for LCL containers.Issue 1: Delay in issuing the adjudication orderThe Revision Application was filed against the Order-in-Appeal, challenging the delay in issuing the adjudication order after ten years. The Commissioner (Appeals) and Respondent argued that the Show Cause Notice must be issued within a reasonable time period, citing the case of M/s. Parekh Shipping Agency. However, the Government noted that the relevant Show Cause Notice was issued well within six months of the IGM filing. The Government found that the alleged delay in completion of adjudication proceedings cannot be solely attributed to the department, and there were no requests for early decision from the Respondents.Issue 2: Nature of the impugned container - LCL or FCLThe main dispute was whether the impugned container was an LCL or FCL. The Government analyzed the legal documents and cited the Bombay High Court's guidelines for Customs authorities, stating that if the seal is intact during de-stuffing of an LCL container, the carrier should be responsible for any discrepancies. Based on this, the Government held the Shipping Agent liable for action under Section 116 of the Customs Act, 1962.Issue 3: Reliance on amended out-turn reportThe Respondent argued against relying on the amended out-turn report issued after a gap of 8 months, citing concerns about pilferage/theft at MBPT. However, the Government found that the reliance on legally admissible documents such as I.G.M. details and Tally Sheets was proper, and there was no evidence to suggest any request for early decision from the Respondents.Issue 4: Burden of proof on the CustomsThe Respondent contended that the burden of proof lies on the Customs, citing various judgments. However, the Government noted that the cited judgments were of cases with different facts and circumstances. The Government emphasized the need to consider each case based on its own facts, as highlighted in legal precedents.Issue 5: Applicability of cited precedentsThe Government examined various precedents cited by the applicant and found that they pertained to different provisions and periods with distinct factual backgrounds. The Government emphasized the importance of considering the specific details of each case, as even a single significant detail can alter the entire aspect, as per legal observations.Issue 6: Responsibility of the shipping agent for LCL containersBased on the guidelines from the Bombay High Court regarding LCL containers, the Government held the Shipping Agent responsible for discrepancies in the manifested quantity and the de-stuffed tally for LCL containers. The Government concluded that quashing the impugned adjudication by the Commissioner of Customs (Appeals) was not legal and proper, setting aside the Order-in-Appeal and allowing the Revision Application.