2013 (10) TMI 1153 - AT - Customs

Tribunal waives penalty for GM in red sanders export case due to lack of evidence. Limited role considered.

SHRI KIRAN S DIXIT Versus COMMISSIONER OF CUSTOMS, HYDERABAD

The tribunal set aside the penalty imposed on the appellant, a General Manager, for alleged involvement in the export of red sanders due to lack of ... Penalty of appellant being GM of the company - stuffing of red sanders in teh guise of polished granites - Held that:- appellant gives containers on request made by importers/exporters; in the case of container, the appellant does not require to be informed of what is contained in the container; the appellants have deployed surveyors in different places. It is the responsibility of the surveyors to receive the empty containers back from the importers, handing over the empty containers for export to the party on production of the Delivery Order, receipt of stuffed containers duly sealed by the Customs on proper documents. The appellants do not exercise control over transportation of containers. The only aspect that is verified when the container is handed over back is whether it is damaged or not. Once the container is not damaged, it again enters in to the trading channels for stuffing and destuffing and moves from place to place. After going through the statement of the appellant and the circumstances under which the container has been intercepted, I find that there is no evidence to show that that the appellant had actually assisted in loading red sanders or tampering the container or they were even aware that red sanders had been filled into the container somewhere on the way until the container was recalled and examination was conducted. Under these circumstances, in this case, apparently penalty has been imposed on the appellant on the ground that he has abetted in stuffing and attempted export of red sanders in the container. Abetment means a positive act on the part of the appellant and as can be seen from the facts and circumstances, there is no evidence forthcoming to show that the appellant had given any assistance in the attempted export of red sanders. In my opinion, negligence on the part of the appellant has not been proved by the revenue. Under these circumstances, a penalty imposed on the appellant has to be set aside and the same is set aside - Prima facie case in favour of assessee - Stay granted. Issues:1. Penalty imposition on the appellant for alleged involvement in export of red sanders.2. Request for waiver of predeposit and stay against recovery of penalty.3. Objection raised by the department regarding the impact of the decision on other related cases.4. Failure to ensure container security during transportation.Issue 1: Penalty ImpositionThe appellant, a General Manager, was penalized for allegedly abetting the export of red sanders in a container meant for polished granite. The container was tampered with, allowing unauthorized access despite intact seals. The appellant's negligence was questioned for not verifying the container's condition during transit and upon return. However, the appellant's statement revealed that their role was limited to providing containers and overseeing their return without control over content or transportation. The tribunal found no evidence of active involvement or knowledge of the red sanders, leading to the penalty being set aside due to lack of proof of abetment.Issue 2: Waiver of PredepositThe appellant sought waiver of predeposit and stay against penalty recovery. Considering the nominal amount and the appellant's individual status post-employment, the tribunal deemed it appropriate to waive predeposit and resolve the matter conclusively.Issue 3: Department's ObjectionThe department objected to waiving predeposit, citing potential impacts on related cases. However, the tribunal reasoned that the decision in this case would not influence other proceedings. It was clarified that observations made were specific to this case and not applicable to other appeals.Issue 4: Container SecurityThe penalty was based on the appellant's alleged failure to prevent tampering during the container's journey. The delayed arrival of the container at Bombay raised suspicions, suggesting negligence on the appellant's part. However, the appellant's statement highlighted their limited role in container handling, emphasizing the responsibility of surveyors and lack of control over transportation. The tribunal concluded that the penalty was unjustified due to the absence of evidence proving the appellant's active involvement or negligence.In conclusion, the tribunal allowed the stay application and appeal, setting aside the penalty imposed on the appellant.