2023 (11) TMI 1035 - AT - Customs

Appeal Restored: Tribunal Sets Aside Penalty for Shipping Agency's Non-Deliberate Delay in Filing Due to Procedural Issues.

Atlantic Global Shipping Pvt Ltd. Versus Commissioner of Customs & Service Tax, Visakhapatnam - Cus

The tribunal restored the appeal after it was initially dismissed for non-prosecution due to a technical error in receiving hearing notifications. It ... Levy of penalty - delay of 5-6 days in filing of EGM from the date of sailing of the ships - Delay in issue of issue / uploading of ‘Sailing Reports’ by the Customs officers - reasonable cause for delay or not - Non-fulfilment of condition specified under Section 41 of the Customs Act 1962 - HELD THAT:- It is seen from the Order-in-Original and Order-in-Appeal that the Appellant has properly canvassed before both the authorities that the initial issue of ‘Sailing Reports’ manually was delayed and subsequent delay in uploading the same in EDI system by the Department has resulted in the delay in filing of EGM by the Appellant. Both the authorities have not given any consideration nor have they brought in any other evidence to suggest that the Appellants submissions were not true. Much bigger issue was before the Chennai Tribunal in the case of Hyundai Merchant Marine India Pvt Ltd., Vs CC, EGM Cell. The Tribunal vide Final Order No. 41691-41697/2021 has noted that Section 41 was amended w.e.f. 01.08.2019. Prior to this date only the person in charge of a conveyance was liable to fulfil the condition. It is held that prior to this date since the words “or any other person as may be specified by the Central Government by Notification” was added only on 01.08.2019. Therefore the Shipping Line or agent or any other person cannot be made liable for nonfiling of the EGM on time prior to this date. In the present case, 4 shipping bills pertain to the period January 2019 to 13.06.2019. Therefore, in these 4 cases as per the said case law decided by Chennai Tribunal no penalty can be imposed. The Appellant has raised various procedural and practical issues and challenges faced, including difficulty of filing the EGM in ICE GATE, but still has not given consideration for the same. The delay of 5-6 days in filing the EGM by the Appellant has been properly explained by him - The impugned order set aside - appeal allowed. Issues involved:The issues involved in the judgment are non-prosecution leading to dismissal of appeal, delay in filing EGMs by a shipping agency, imposition of penalty under Section 41 of the Customs Act 1962, consideration of procedural and practical challenges faced by the appellant, and interpretation of relevant legal provisions and case law.Non-prosecution of appeal:The appeal was dismissed for non-prosecution due to the appellant not receiving hearing intimations sent by email. The appellant filed a petition seeking restoration of the appeal, explaining that a missing letter in the email address caused the non-receipt of intimations. The tribunal found that the non-attendance at the hearing was not deliberate, allowing the restoration of the appeal with the consent of both parties.Delay in filing EGMs:The appellant, a shipping agency, faced a Show Cause Notice for delays in filing EGMs for exports. The delay was attributed to delays in receiving and uploading 'Sailing Reports' manually by Customs Officials before electronically filing the EGMs. The Adjudication Authority imposed a penalty of Rs. 25,000 for the delayed filings, which was upheld by the Lower Appellate Authority. The appellant contended that the delays were due to procedural issues and challenges faced in tracking electronically, without any evidence of deliberate delay or fraud.Imposition of penalty under Section 41:The tribunal examined the penalty imposed under Section 41 of the Customs Act 1962. It was noted that prior to a specific amendment in August 2019, only the person in charge of a conveyance was liable for fulfilling conditions related to EGM filings. Citing a case law precedent, it was established that prior to the amendment date, the shipping line or agent could not be held liable for delays in EGM filings. The tribunal found that the delays in this case were adequately explained, setting aside the penalty imposed by the Commissioner (Appeals).Consideration of procedural challenges:The appellant raised procedural and practical challenges faced in filing EGMs, including difficulties with the ICE GATE system. Despite these challenges, the Adjudication Authority and Lower Appellate Authority did not consider the explanations provided by the appellant. The tribunal, after reviewing the factual matrix, statutory provisions, and relevant case law, concluded that the delays in filing EGMs were justified and set aside the Order-in-Appeal, allowing the appeal with consequential reliefs as per law.