Customs penalty cannot stand without misdeclaration or suppression, and extended limitation fails on the same facts.

Penalty under the Customs Act could not be sustained where misdeclaration, suppression of facts, and intent to evade duty were not established. The appellant had imported the goods regularly through the same air cargo complex, the bills of entry were found not to involve misdeclaration, and that finding remained undisturbed. On those facts, there was no basis to invoke the extended period, and the enhanced penalty was also held unsupported by reasons and unjustified. The appeal therefore succeeded and the order enhancing the penalty was set aside.

---

---

Issues: Whether the penalty imposed under Section 112(a) of the Customs Act, 1962 and its enhancement under Section 128A(3) of the Customs Act, 1962 were sustainable in the absence of misdeclaration, suppression of facts, or any intention to evade duty.

Analysis: The appellant had been importing the goods regularly for several years through the same air cargo complex and customs authorities had cleared the consignments without objection. The finding of no misdeclaration in the bills of entry was recorded by the original authority and remained undisturbed in appeal. In these circumstances, there was no basis to invoke the extended period or to infer suppression of facts or intent to evade duty. The enhanced penalty was also found to be unsupported by reasons and unjustified on the facts.

Conclusion: The penalty and its enhancement were not sustainable and the issue was decided in favour of the assessee.

Final Conclusion: The appeal succeeded and the impugned order enhancing the penalty was set aside.

Ratio Decidendi: Penalty and its enhancement cannot be sustained where misdeclaration and suppression are not established and the facts do not justify invocation of the extended limitation period.

---