TaxTMI 
TaxTMI 
2025 (6) TMI 1606
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....with section 14 of the Customs Act, 1962 the Customs Act. The order also confiscates the seized 9900 kgs of Melamine valued at Rs. 7,16,873/- under rule 111(m) of the Customs Act with an option of payment of redemption fine in lieu of confiscation. The order also holds that the goods of which assessable value has been re- determined are also liable to confiscation but as the goods are not available for confiscation, redemption fine is not required to be imposed. The order also confirms recovery of anti-dumping duty from the appellant under section 28(4) of the Customs Act and also imposes penalty upon the appellant under sections 114A and 112(a) and (b) of the Customs Act. 2. Customs Appeal No. 52751 of 2019 has been filed by Arijinder Singh Gulati, Director of the appellant to assail that part of the order passed by the Principal Commissioner that imposes penalty upon him under sections 114AA and 112(a) and (b) of the Customs Act. 3. The appellant is a private limited company with Arjinder Singh Gulati and Nirmal Paul Gulati as Directors of the Company. The appellant started the unit in 1988 and manufactured Opel Glassware but the unit was subsequently closed. Thereafter, th....
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....of Bank Guarantee of Rs. 89,925/- and Bond of Rs. 7,16,873/-. 7. A show cause notice dated 27.03.2018 was issued to the appellant after two and half years from the recording of the statement of the Director on 23.10.2015 raising demand of anti-dumping duty under section 28 of the Customs Act with interest and penalty for the period from 25.04.2013 to 29.05.2015 alleging suppression of facts on the part of the appellant. 8. The main contention advanced by Dr. G.K. Sarkar learned counsel for the appellant assisted by Shri Prashant Shrivastava is that the extended period of limitation contemplated under section 28(4) of the Customs Act could not have been invoked in the facts and circumstances of the case. 9. This contention, therefore, needs to be first examined because the entire demand would have to be set aside if it is found to be correct. For this purpose, the relevant portion of the show cause notice issued to the appellant, the reply filed by the appellant and the manner in which it has been dealt with by the Principal Commissioner would require be consideration. 10. Paragraph 18 of the show cause notice mentions that a higher value was deliberately declared by the....
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....on of value in import clearance of impugned goods, he appears to have rendered himself liable for penal action in terms of the provisions of Section 112 & 114AA of the Customs Act, 1962 respectively." ( emphasis supplied ) 11. The appellant filed a reply to the show cause notice and submitted that the extended period of limitation contemplated under section 28(4) of the Customs Act could not have been resorted to. The appellant also submitted that the allegation of overvaluation was based on assumptions and presumptions. The relevant portion of the reply is reproduced below: "The Noticee submits that vide Show Cause Notice dated 27.03.2018, department has raised demand in respect of import consignments cleared during the period 2013 to 2015. Therefore, the demand is beyond the prescribed period of one year and hence, time barred. The Noticee further submits that to justify demand department has invoked the provisions of Section 28(4) of the Customs Act, 1962 alleging misdeclaration by way of over valuation of the subject goods. However, the said allegations is not backed by any concrete evidence. Department has completely ignored the fact that the Notice declar....
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....uppression of facts and hence the extended period of limitation has rightly been invoked in the show cause notice for recovery of the above said demand amount of anti- dumping duty. Therefore, I hold that the anti-dumping duty of Rs. 64,33,431/- (Rs. 55,81,850/- + Rs. 7,80,312/- + Rs. 72,269/-) as raised in the show cause notice and not-paid by the Noticee No. 1 by resorting to suppression of facts and mis-statement, is recoverable from them under the provisions of Section 28(4) of the Customs Act, 1962 alongwith the interest as applicable under Section 28AA of the Act ibid." ( emphasis supplied ) 13. Learned counsel for the appellant made the following submissions in connection with the invocation of the extended period of limitation under section 28(4) of the Customs Act: (i) It is evident from the Bills of Entry that the goods that were imported by the appellant had been examined by the officers of customs and, thereafter, out of charge was given. The names of the officers who examined the goods and allowed clearance are also mentioned in the Bills of Entry with signature and stamp of the Customs Officers; (....
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....uty under section 28(4) of the Customs Act. 15. The submissions advanced by the learned counsel for the appellant and the learned authorized representative appearing for the department have been considered. 16. The contention of the learned counsel for the appellant is that the extended period of limitation contemplated under section 28(4) of the Customs Act could not have been invoked in the facts and circumstances of the case. 17. It would, therefore, be appropriate to reproduce sub-sections (1) and (4) of section 28 of the Customs Act and they are as follows: "28. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded (1) Where any duty has not been levied or not paid or short-levied or short-paid or erroneously refunded, or any interest payable has not been paid, part-paid or erroneously refunded, for any reason other than the reasons of collusion or any willful mis-statement or suppression of facts,- (a) the proper officer shall, within one year from the relevant date, serve notice on the person chargeable with the duty or interest which has not been so levied or paid or which has been short-lev....
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....be urged that any fact relevant to the dispute had been suppressed by the appellant. What is also important to notice is that the premises of the appellant were searched on 03.09.2015. All the records would have been examined by the department and, therefore, also the department became aware of the facts at least on 03.09.2015. This apart, the statements of the Director of the appellant were also recorded on 08.04.2015 and 23.10.2015. All the facts must also have come to the notice of the department. There is no averment that any additional relevant fact came to the notice of the department after the search was conducted or after the statements were recorded. The show cause notice also does not mention that any enquiry was conducted by the department after 23.10.2015 and before 27.03.2018 when the show cause notice was issued. There is no explanation offered by the department as to why the department waited for about two years and six months to issue the show cause notice. It does not, therefore, lie in the mouth of the department to contend that even though the show cause notice was issued to the appellant after the expiry of the normal period of one year, but still recourse to th....
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....provisions, it would be totally unjustified to invoke the extended period of limitation. The Supreme Court further held that in any scheme of self-assessment, it is the responsibility of the assessee to determine the liability correctly and this determination is required to be made on the basis of his own judgment and in a bonafide manner. The relevant portion of the judgment is reproduced below: "23. We are in full agreement with the finding of the Tribunal that during the period in dispute it was holding a bona fide belief that it was correctly discharging its duty liability. The mere fact that the belief was ultimately found to be wrong by the judgment of this Court does not render such belief of the assessee a mala fide belief particularly when such a belief was emanating from the view taken by a Division Bench of Tribunal. We note that the issue of valuation involved in this particular matter is indeed one were two plausible views could co- exist. In such cases of disputes of interpretation of legal provisions, it would be totally unjustified to invoke the extended period of limitation by considering the assessee's view to be lacking bona fides. In any scheme of....
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.... between the appellant and the Revenue. The appellant held a different view about the eligibility of CENVAT credit than the Revenue. Naturally, the appellant self-assessed duty and paid service tax as per its view. Such a self- assessment, cannot, by any stretch of imagination, be termed deliberate and wilful suppression of facts." ( emphasis supplied ) 30. It cannot, therefore, be alleged that the appellant had suppressed the value of the goods, much less suppressed it with an intention to evade payment of customs duty. 31. The inevitable conclusion, therefore, that follows from the above discussion is that the extended period of limitation contemplated under section 28(4) of the Customs Act was incorrectly invoked. 32. The reason for imposing penalty upon the appellant has been stated by the Principal Commissioner in paragraph 19 of the order and it is reproduced below: "19. Further, due to the mis-declaration of value resorted to by Shri Arjinder Singh Gulati in import of melamine (dumped goods) in terms of the Customs Tariff Act, 1975 through his firm, he appears to have willfully evaded Anti-Dumping duty amounting to Rs. 55,81,850/- Rs. 7,80,312/-and....