Appeal Dismissed: Appellant's Liabilities and Claims Extinguished Under CIRP; Section 112(a) Customs Act Penalty Nullified

The Tribunal dismissed the appeal as infructuous, acknowledging that the appellant's liabilities and claims, including the confiscation of goods and imposition of redemption fine and penalty under Section 112(a) of the Customs Act, were extinguished under the Corporate Insolvency Resolution Process (CIRP) as per the approved resolution plan by NCLT. The Tribunal noted that similar government dues were previously extinguished in the appellant's case upon NCLT approval, leading to the dismissal of the appeal.

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Issues involved:
The appeal against confiscation of goods and imposition of redemption fine and penalty under Section 112(a) of the Customs Act.

Details of the Judgment:

Issue 1: Confiscation of Goods and Imposition of Redemption Fine and Penalty
The appellant, formerly known as Essar Steel India Ltd (ESIL), imported scrap with an excess quantity of 1300 MTS compared to the declared amount. The goods were confiscated under Section 111(m) of the Customs Act, with a redemption fine of Rs.16.5 Lakhs and a penalty of Rs. 3.5 Lakhs imposed. The Commissioner (Appeals) later reduced the redemption fine to Rs. 5 Lakhs and the penalty to Rs. 1 Lakh. The appellant argued that due to Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, all claims prior to the effective date of management takeover were extinguished as per the approved resolution plan. The Tribunal found a similar situation in the appellant's own case where government dues were extinguished upon NCLT approval, leading to the dismissal of the appeal as infructuous.

Issue 2: Corporate Insolvency Resolution Process (CIRP) and Extinguishment of Liabilities
The appellant underwent CIRP, and the resolution plan approved by NCLT extinguished all liabilities and claims prior to the effective date of management takeover. The Tribunal observed that as per the approved resolution plan, all liability and claims pertaining to ESIL that arose before the effective date shall stand extinguished, settled, abated, and satisfied. The Tribunal referred to a previous case where government dues were extinguished upon NCLT approval, leading to the dismissal of the present appeal as infructuous.

Conclusion:
Considering the extinguishment of liabilities and claims under the approved resolution plan due to CIRP, the Tribunal found the appeal to be infructuous and dismissed it accordingly. The appeal was disposed of based on the above terms.

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