TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Appeal dismissed as not maintainable since seizure valuation (Rs 18,96,628 plus Rs 1,00,000 penalty) below CBIC pecuniary threshold</h1> The HC held the appeal not maintainable under the pecuniary threshold fixed by the Central Board of Indirect Taxes and Customs. The recovered goods' value ... Maintainability of appeal in the light of the pecuniary limit fixed by the Central Board of Indirect Taxes and Customs for filing an appeal before the High Court - Setting aside of confiscation and penalty - HELD THAT:- The value of the recovered article in each of the present case is only Rs. 18,96,628/- and the penalty imposed was Rs. 1 lakh. Evidently, the value is below the limit notified. The Apex Court in Commissioner of Customs, Amritsar v. Harish Chander [2023 (5) TMI 1456 - SC ORDER], took into consideration the value of the goods at the time of seizure and held that it being below the threshold fixed, no appeal would lie. Since the value involved in the present appeal is much less than the limit fixed, the appeal would not lie - the appeal is dismissed as not maintainable. ISSUES PRESENTED AND CONSIDERED 1. Whether an appeal by the Department to the High Court is maintainable where the aggregate monetary value of confiscated goods and redemption fine falls below the monetary limit fixed by the Board for filing appeals to the High Court/CESTAT. 2. Whether instructions/circulars issued by the Ministry of Finance / Central Board of Indirect Taxes and Customs fixing monetary thresholds apply to pending appeals in High Courts/CESTAT. 3. Whether redemption fine under Section 125 of the Customs Act, which is an option in lieu of confiscation, should be counted for the purpose of applying the monetary limit for instituting appeals to the High Court. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Maintainability of appeal where value is below prescribed monetary limit Legal framework: Instructions issued under the Board's administrative powers (referred to as F.No.390/... series) fix monetary limits below which appeals shall not be filed in CESTAT or High Courts; exercise of powers under Section 131BA of the Customs Act is referenced in the latest instruction. Section 125 of the Customs Act permits payment of a redemption fine in lieu of confiscation. Precedent Treatment: The Apex Court (in a reported judgment considered by the Court) applied the monetary threshold by examining the value of goods at the time of seizure and held that appeals are not maintainable where the value is below the prescribed limit. Several High Courts have applied the same principle in analogous confiscation-of-gold cases. Interpretation and reasoning: The Court accepts the administrative instructions as determinative of the threshold for instituting appeals. It applies the most recent fixation of monetary limits to the facts - noting that the value of the recovered article is Rs.18,96,628/- and the penalty imposed was Rs.1,00,000/-, both figures being below the prescribed monetary limit (as updated in successive instructions). The rationale underlying the instructions - reduction of Government litigation - is noted as a policy reason supporting the threshold. Ratio vs. Obiter: The holding that an appeal is not maintainable where the value/amount involved is below the threshold is treated as ratio in the present context because it is decisive of the maintainability question before the Court. Conclusion: The appeal is not maintainable and must be dismissed because the value involved is below the monetary limit fixed for filing appeals to the High Court/CESTAT. Issue 2 - Applicability of monetary-limit instructions to pending appeals Legal framework: Administrative instructions/circulars issued by the Ministry/Board include explicit language applying the instructions to all pending appeals in High Courts/CESTAT. Precedent Treatment: The Court treats the Board's instruction applying the ceiling to pending appeals as valid guidance to be followed by courts/tribunals when determining maintainability. Interpretation and reasoning: The Court relies on the instruction dated 01.01.2016 which explicitly states that the monetary-limit instructions apply to all pending appeals. Given this clear administrative clarification and subsequent re-fixations of limits (from Rs.15 lakhs to Rs.20 lakhs and later to Rs.1 crore), the Court applies the applicable threshold to the pending matter before it. Ratio vs. Obiter: The application of the Board's instruction to pending appeals is treated as ratio where it directly affects the maintainability determination in this appeal. Conclusion: The monetary-limit instructions apply to pending appeals and are applicable to the present appeal; therefore maintainability must be assessed against the prescribed threshold. Issue 3 - Treatment of redemption fine under Section 125 for threshold calculation Legal framework: Section 125 of the Customs Act provides that where confiscation is authorized, the adjudicating officer may (or shall, in some cases) give an option to pay a redemption fine in lieu of confiscation; the redemption fine cannot exceed the market price of the goods. Precedent Treatment: The Court refers to prior decisions (including the Apex Court's treatment) that considered the value of the goods at the time of seizure when applying monetary thresholds; those decisions involved confiscation and redemption fine contexts. Interpretation and reasoning: The Court recognises that redemption fine is an alternative to confiscation and that the circulars governing monetary limits treat 'redemption fine' as part of the quantum relevant for determining whether an appeal should be entertained. Where the issue is solely the redemption fine, the circular provides that appeals are maintainable only if the redemption fine exceeds the prescribed monetary limits; where both redemption fine and penalty are in dispute, their combined amount is to be considered. Applying that administrative guidance, the Court notes that in the present case the value of goods and penalty together fall below the threshold. Ratio vs. Obiter: The Court's treatment of redemption fine as relevant to the threshold calculation is ratio to the extent it determines maintainability in this appeal; statements about policy and the statutory nature of Section 125 are explanatory but directly tied to the decision. Conclusion: Redemption fine is to be counted (alone or combined with penalty as directed by the circular) for applying the monetary-limit threshold; in this case the amounts fall below the limit and therefore the appeal is not maintainable. Cross-References and Final Determination 1. The Court cross-references (a) the Board/Ministry instructions fixing monetary limits and applying those limits to pending appeals, and (b) judicial precedent applying the threshold to confiscation/redemption contexts; both lines of authority support dismissal for non-maintainability. 2. Given the combined factual and legal application above, the Court concludes that the appeal is not maintainable and dismisses the appeal on that ground.
TaxTMI 
TaxTMI 
