2016 (2) TMI 648 - AT - Customs

Appellate Tribunal reduces penalty for customs violation due to appellants' negligence

The Appellate Tribunal upheld the penalty imposition under Section 117 of the Customs Act, 1962, but reduced it from &8377; 45,000 to &8377; ... Levy of penalty - Provisional assessment and release of goods against P.D. bond - non supply of documents and information within prescribed period - violation of conditions of Bond - appellants submits that there was no intention to evade duty nor was there any loss to Revenue in this matter. It is purely a technical issue, and therefore, pleaded for waiver of complete penalty. - Held that:- the appellants had not taken the appropriate steps at the appropriate time that they had not submitted the documents in time as prescribed in the P.D. Bond executed by them nor had they approached the Department for extension of time. This has resulted in Revenue issuing a show cause notice, which set the adjudication process and present litigation in motion. As there is no doubt that the appellants were negligent, we do find that there is sufficient reason to impose penalty on the appellants under Section 117 of the Customs Act, 1962. - Levy of penalty (though reduced) confirmed - Decided partly in favor of appellant. Issues Involved:Violation of conditions of Provisional Duty Assessment Bond under Section 18 of the Act - Penalty imposed under Section 117 of the Customs Act, 1962 - Reduction of penalty on appeal.Analysis:Issue 1: Violation of conditions of Provisional Duty Assessment Bond under Section 18 of the ActThe case involved the import of consignments by the Appellants at Navlakhi port, which were provisionally assessed due to the lack of original documents, chemical test results, and valuation aspects. The goods were allowed clearance based on Provisional Duty Assessment Bonds executed by the Appellants. The Bond required the importer to produce original documents within a specified time limit, failing which the Bond would remain in full force. The Appellants failed to produce the original documents within the stipulated time, despite reminders from the Customs authorities, leading to a violation of the Bond's conditions.Issue 2: Penalty imposed under Section 117 of the Customs Act, 1962The Deputy Commissioner of Customs, Jamnagar, imposed a penalty of &8377; 90,000 on the Appellants for the violation of the Bond's conditions. On appeal, the penalty was reduced to &8377; 45,000 by the Commissioner (Appeals). The Appellants contested the penalty imposition, arguing that there was no intention to evade duty, and it was a technical issue, requesting a complete waiver of the penalty. The Revenue, represented by the Authorized Representative, contended that the Appellants had not complied with the Bond's requirements and had only submitted the documents after a show cause notice was issued, justifying the penalty imposition.Issue 3: Reduction of penalty on appealAfter hearing both sides and considering the arguments and submissions, the Appellate Tribunal found that the facts were undisputed. While acknowledging the Appellants' negligence in not submitting the documents within the prescribed time or seeking an extension, the Tribunal recognized the need for penalty imposition. However, considering the circumstances, a nominal penalty of &8377; 20,000 was deemed sufficient, leading to a modification of the impugned order to reflect the reduced penalty amount. The Tribunal upheld the penalty imposition but reduced it based on the Appellants' plea and the Revenue's arguments.In conclusion, the appeal was disposed of with the modified penalty amount of &8377; 20,000 upheld by the Appellate Tribunal.