CONCOR liable for customs duty on pilfered goods after seal tampering, faces Rs 1 lakh penalty under section 117

CESTAT New Delhi upheld customs duty demand against CONCOR under section 45(3) after imported goods were pilfered from their custody. The container's customs seal was broken and replaced with an unnumbered private red seal, resulting in loss of goods valued at Rs. 5,93,25,481. The court imposed Rs. 1 lakh penalty on CONCOR under section 117 for inadequate care. The importer was penalized under sections 112(a) and 114AA for knowingly mis-declaring glass chatons as glass beads after examining samples. Goods were held liable for confiscation under section 111, though actual confiscation was impossible due to pilferage. All appeals were dismissed.

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Issues Involved:

1. Rejection of declared value and re-determination of value.
2. Liability for confiscation and imposition of penalties.
3. Demand of differential duty and imposition of penalties on CONCOR.
4. Imposition of penalties on individuals involved.

Summary:

1. Rejection of Declared Value and Re-determination of Value:
The Commissioner of Customs (Import) rejected the declared value of Rs. 19,20,433/- for the goods and re-determined the value as Rs. 5,93,25,481/- under Rule-9 of the Customs Valuation (Determination of Value of Import Goods) Rules, 2007.

2. Liability for Confiscation and Imposition of Penalties:
The goods with the re-determined value were held liable for confiscation under Section 111 (1) & (m) and 119 of the Customs Act, 1962. However, no redemption fine was imposed as the goods were pilfered and not available for confiscation. Various penalties were imposed on different parties under relevant sections of the Customs Act, 1962:
- M/s Nomita International: Rs. 1,00,00,000/- under Section 112(a)(v) and Rs. 50,00,000/- under Section 114AA.
- Sh. Atal Bhushan Bhatt: Rs. 2,00,00,000/- under Section 112(a)(v) and Rs. 50,00,000/- under Section 114AA.
- Sh. B.S.Mann: Rs. 20,00,000/- under Section 112(a) and Rs. 10,00,000/- under Section 114AA.
- Sh. Rohit Sharma: Rs. 5,00,000/- under Section 112(a) and Rs. 50,000/- under Section 114AA.

3. Demand of Differential Duty and Imposition of Penalties on CONCOR:
M/s Container Corporation of India Limited (CONCOR) was held liable for the differential duty amounting to Rs. 1,68,34,053/- under Section 45 of the Customs Act, 1962, as the goods were lost while under its custody. A penalty of Rs. 1,00,000/- was imposed under Section 117 of the Customs Act, 1962.

4. Imposition of Penalties on Individuals Involved:
- Shri Bhalinder Singh Mann: The penalty of Rs. 20,00,000/- under Section 112(a) and Rs. 10,00,000/- under Section 114AA was upheld. The evidence showed that both Shri Mann and his Manager were aware of the actual goods being imported and had filed Bills of Entry with a wrong description.
- Shri Rohit Sharma: The penalty of Rs. 5,00,000/- under Section 112(a) and Rs. 50,000/- under Section 114AA was upheld. His statement under Section 108 of the Customs Act revealed his awareness and involvement in the mis-declaration of the import consignment.

Conclusion:
All three appeals were dismissed, and the impugned order was upheld.

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