2000 (5) TMI 652 - AT - Customs

Tribunal Orders Duty Appropriation in Mistake Rectification Case

The Tribunal ordered the Commissioner of Customs to appropriate duty amounts from the sale proceeds in a case involving rectification of mistake and a ... Rectification of mistake - Sale proceeds Issues:- Rectification of mistake application- Misc. application under Rule 41 of CEGAT (Procedure) Rules- Duty liability on goods cleared under Transfer of Residence Rules- Appropriation of duty, penalties, and redemption fine from sale proceedsRectification of Mistake Application:The judgment revolves around applications for rectification of mistake and a Misc. application under Rule 41 of CEGAT (Procedure) Rules. The Revenue submitted the Misc. application seeking direction to pay sales proceeds of goods disposed of after confiscation. The Tribunal had earlier allowed redemption of goods on payment of a fine and reduced penalties. The applicants argued that the goods had already borne duty when cleared from customs and thus, no further duty should be paid. However, they failed to provide evidence supporting this claim. The Tribunal found the Revenue's argument logical, especially since the goods were cleared under Transfer of Residence benefit. Consequently, the Tribunal ordered the Commissioner of Customs to appropriate duty amounts from the sale proceeds.Duty Liability on Goods Cleared under Transfer of Residence Rules:The Tribunal considered the conflicting claims regarding duty liability on goods cleared under Transfer of Residence Rules. The applicants contended that duty had already been paid when the goods were cleared and thus, no additional duty should be levied. On the other hand, the Revenue argued that since the goods were cleared under duty exemption under the Transfer of Residence Rules and later held liable for confiscation, duty needed to be recovered. The Tribunal found the Revenue's argument more convincing due to the lack of evidence from the appellants proving duty payment. Therefore, the Tribunal ordered the Commissioner of Customs to appropriate duty amounts from the sale proceeds.Appropriation of Duty, Penalties, and Redemption Fine from Sale Proceeds:The final order directed the Commissioner of Customs to appropriate duty amounts leviable on the goods from the sale proceeds. Subsequently, penalties imposed were to be appropriated, if unpaid by the appellants. Finally, the Commissioner was to appropriate the redemption fine from the remaining sale proceeds. However, if the available amount from the sale proceeds was less than the redemption fine, no proceeds would be released to the appellants. The hierarchy for appropriation was set as duty first, then penalties, and finally the redemption fine. The Tribunal disposed of the Revenue's Misc. application and the rectification of mistake application accordingly, ensuring proper appropriation of amounts from the sale proceeds.