2014 (10) TMI 797 - AT - Customs

Penalties Overturned in Export Goods Misdeclaration Case

GAJANAN B. SUDRIK Versus COMMISSIONER OF CUSTOMS (EP), MUMBAI

GAJANAN B. SUDRIK Versus COMMISSIONER OF CUSTOMS (EP), MUMBAI - 2014 (304) E.L.T. 159 (Tri. - Mumbai) Issues: Mis-declaration of export goods, overvaluation, penalties imposed on exporter, penalties on individuals involved, liability of CHA firm and its employee, involvement in fraudulent transactions, imposition of penalty.In this case, three appeals were filed against an Order-in-Original passed by the Commissioner of Customs regarding mis-declaration and overvaluation of export goods by a company, leading to confiscation of goods and imposition of penalties on the exporter and other individuals involved. The main contention was the liability of a Clearing House Agent (CHA) and his employee in the fraudulent transaction. The appellants argued that they were not directly involved in the misdeclaration or over-valuation of goods and cited precedents to support their claim that CHAs cannot be held responsible for the importer's wrongdoings. The Tribunal considered statements from the appellants and found no evidence linking them to the fraudulent transactions. It was noted that the CHA had submitted identification documents establishing the exporter's identity, and the role of one individual was limited to introducing the exporter to the CHA without any knowledge of the nature of the goods. Based on these findings and legal precedents, the Tribunal concluded that the penalty imposed on the appellants was unsustainable in law. Therefore, the penalties imposed on the individuals involved, including the CHA firm and its employee, were set aside, and the appeals were allowed.