2017 (11) TMI 789 - AT - Customs

Court Overturns Confiscation & Penalties in Customs Case

The court set aside the impugned order and allowed all appeals in a case involving failure to produce valid import documents, procedural lapses in ... Import of yellow peas - Revenue was of the view that the importers have used the barges without observing the Customs formalities, such as, amendment and inclusion of name of barges in question in the overside discharge guarantee - Held that: - no duty was liable on the imported Yellow Peas and the only reason for the Commissioner to confiscate the goods and to impose penalty, is a procedural lapse by the appellant as also by the CHA inasmuch as the barges on which the goods were un-loaded were not brought to the notice of the Customs Officers by including their names in the over-side discharge guarantee filed by them - Though the said activity of the appellant, is in violation of the procedural condition as envisaged in the Customs Act, 1962, but keeping in view, that no duty liability was involved and appreciating the reasons given by the assessee, the confiscation of the other imported goods or the barges and the imposition of penalty upon the appellants, would not be justified - appeal allowed - decided in favor of appellant. Issues:1. Failure to produce valid documents for imported cargo.2. Alleged procedural lapses in unloading imported goods.3. Confiscation of goods and imposition of penalty.Analysis:Issue 1: Failure to produce valid documents for imported cargoThe case involved two barges found anchored at Salimar Point carrying yellow peas. The Masters of the barges failed to produce valid documents supporting the import of Canadian Whole Yellow Peas. Despite producing some receipts, no other relevant documents were provided. This raised suspicions regarding the legality of the imported goods.Issue 2: Alleged procedural lapses in unloading imported goodsFurther investigation revealed that the importers had not followed Customs formalities, specifically the inclusion of the barge names in the overside discharge guarantee. The Commissioner noted that the barges used for transporting goods were not included in the guarantee filed by the importer. This procedural lapse led to the confiscation of the imported goods and the initiation of penalty proceedings under the Customs Act, 1962.Issue 3: Confiscation of goods and imposition of penaltyThe Commissioner found that the imported goods were liable for confiscation under Section 111(h) of the Customs Act, 1962, due to the failure to comply with Customs procedures. However, it was highlighted that no duty was liable on the imported Yellow Peas. Despite the procedural violation, considering the reasons provided by the importer and the absence of duty liability, the confiscation of goods and imposition of penalties were deemed unjustified. Consequently, the impugned order was set aside, and all appeals were allowed.In conclusion, the judgment addressed the failure to produce valid import documents, highlighted procedural lapses in unloading goods, and discussed the confiscation of goods along with the imposition of penalties. The decision focused on the absence of duty liability, the reasons provided by the importer, and the procedural violations under the Customs Act, 1962.