TaxTMI 
TaxTMI 
2016 (10) TMI 334
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..../03/1988. Later, a show cause notice came to be issued after 9 years, calling upon the petitioner to show cause as to why the equipment imported by it should not be confiscated and why a penalty should not be imposed on the petitioner under Section 114A of the Customs Act, 1962 (hereinafter referred to as 'the Act') alleging that there is non-compliance of the conditions stipulated in the Notification No.64/1988. Petitioner submitted objections. However, the 3rd respondent, while rejecting the contentions of the petitioner, ordered confiscation of the equipment under Section 111(o) of the Customs Act, 1962. However, the petitioner was given an option to pay a redemption fine of Rs. 16 lakhs in lieu of confiscation. The petitioner was also imposed a penalty of Rs. 6,50,000/- under Section 112(a) of the Customs Act, 1962. Ext.P1 is the said order. Petitioner preferred an appeal which came to be rejected, pursuant to which a demand had been made as per Exts.P3 and P4. Petitioner, challenging the same, filed W.P.C.No.26025/2007, which came to be dismissed. 3. In the meantime, the 3rd respondent filed Customs Appeal No.411/2004 against Ext.P1 order on the ground that the amou....
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....galore. The Tribunal remitted the matter back for fresh consideration. The matter was considered on merits by the Commissioner of Central excise and Customs, Thiruvananthapuram and Ext.P1 order was passed ordering confiscation under Section 111(o) with an option to the petitioner to pay Rs. 16 lakhs as redemption fine in lieu of confiscation. The adjudicating authority had also imposed penalty of Rs. 6,50,000/- and the petitioner as well as the Department preferred appeals. Petitioner's appeal was dismissed as per Ext.P2 final order. The appeal filed by the Department was allowed to the extent the adjudicating authority did not specify the amount of customs duty payable and accordingly Ext.P7 order was passed ordering that the petitioner is liable to pay customs duty on the goods in terms of Sec.125(2) of the Act. It is further submitted that the petitioner had an option to avail statutory remedy under Section 130E of the Act and having failed to do so, the Tribunal's order cannot be challenged in the present writ petition. 6. The contention that the writ petition is not maintainable on account of availability of an alternate remedy, though can be appreciated, having reg....
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....ral Government. According to the petitioner, he had already remitted the penalty as imposed under Section 112. In terms of Sec.112 of the Act, a person is liable to pay penalty, if he does or omits to do any act or omission which would render such goods liable to confiscation under Section 111 of the Act. No doubt, by not complying with the conditions of exemption, the goods in question became liable to be confiscated and therefore the petitioner had become liable to penalty as well as confiscation of goods. 9. This is an instance where orders are passed confiscating the goods as provided under the Statute. In other words, the question is very simple. If the goods are confiscated by the Government, under Chapter XIV, whether the owner of the goods or the person in possession at the time of seizure, will have any obligation to pay the customs duty and other charges. Section 111 only indicates that certain item of goods on certain eventualities can be confiscated. Section 112 makes a person liable to pay penalty for committing any act or omission which render the goods liable to confiscation under Section 111. Sections 113 and 114 relates to confiscation and penalty for improperly....
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....ging confiscation shall take and hold possession of the confiscated goods." Sec.127 further indicates that an award of confiscation or penalty by an officer of customs shall not prevent the infliction of any punishment to which the person affected thereby is liable under the provisions of Chapter XIV of the Act or under any other law. A perusal of the provisions of Chapter XIV would indicate that there is no specific provision to impose duty, if the goods are confiscated. The liability to pay customs duty arises only when fine is imposed in lieu of confiscation. Though such an order can be passed, if the petitioner does not pay fine in lieu of confiscation, the remedy of the respondent is only to confiscate the goods. In such an event, there is no provision to recover the customs duty and other charges. 10. In some what a similar situation, the Apex Court in Fortis Hospital Ltd. v. Commr. of Customs, [(2015) 12 SCC 715], while considering section 125 of the Customs Act held as under: "It may be seen from the bare reading of the aforesaid section that under Section 125(1) of the Act, option is given to the importer whose goods are confiscated, to pay the fine in li....
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.... exercised, the moment it was stated in the order of the Commissioner that fine is being "imposed", sub-section (2) would get attracted. We do not agree with the aforesaid submission of Mr Radhakrishnan. The order confiscating the goods has already been reproduced above. Insofar as the payment of fine is concerned, only option was given (and that was only course of action which could be visualised under Section 125). The order categorically states that "the importer `may' redeem the confiscated goods on payment of fine of Rs. 1,00,000 (Rupees one lakh only)". 13. Indubitably, unless an option is exercised, fine does not become payable. Sub-section (2) of Section 125 uses the expression "imposed" by stating "where any fine in lieu of confiscation of goods is imposed". In Black's Law Dictionary (10th Edn.), the word "impose" is defined as "to levy or exact (a tax or duty)". Thus, it has to be a levy or exact which is become payable and has to be paid. Likewise, the word "impose" is defined by Oxford English Dictionary, as relevant for the purpose of the present case, as "Lay or inflict (a tax, duty, charge, obligation, etc.) (on or upon), esp. forcibly; compel compliance with....