TaxTMI 
TaxTMI 
2006 (1) TMI 134
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....e Act, calling upon the respondent to show cause as to why correct duty should not be assessed and realized from the respondent in respect of certain goods which the respondent had cleared without a bill entry but by claiming the goods as his personal baggage on 3-12-1999, when the respondent was returning from Singapore. 3. The show cause notice had, inter alia, indicated that the declaration by the respondent that the personal baggage contained only toys was a mis-declaration; that it contained large quantities of mobile phones, mobile phones in CKD condition, computer ROMS, notebooks ROMS and such other notified items notified for the purpose of Section 123 of the Act which were being brought for sale on commercial lines and not for mere personal use of the respondent. The show cause notice had indicated the duty liability and also proposed to levy penalty etc. 4. It is on receipt of such show cause notice dated 23-5-2000, the respondent had filed an application before the Settlement Commission under the provisions of Section 127B of the Act, praying for the case to be settled in terms of Section 27C of the Act. 5. The Settlement Commission had called for a ....
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....his was a clear case of brazen attempt at clearance without payment of duty and smuggling, a penalty of Rs. 25,00/- (sic) is imposed under Section 112(b)(v) of the Customs Act, 1962 and immunity is given in excess thereof in terms of Section 127H." (Emphasis supplied) It is aggrieved by this order, the present writ petition by the Commissioner of Customs. 9. It is, inter alia, urged in the writ petition that the Settlement Commission should not have entertained the application for the reason that the respondent had indulged in activity of smuggling; that the respondent had tried to smuggle goods and the Settlement Commission itself having found the same, levied penalty of Rs. 25,000/-, the Settlement Commission could not have entertained the application in view of the third proviso to Section 127B of the Act, which reads as under : "Provided also that no application under this sub-section shall be made in relation to goods to which Section 123 applies or to goods in relation to which any offence under the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985) has been committed." 10. It is also the contention of the petitioner that ....
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....ondent who are on the facts and on the findings of the Settlement Commission itself a smuggler. 13. In this regard, Shri Veerendra Sharma would place reliance on the decision of a learned Single Judge of the Madras High Court in the case of Commissioner of Customs (Air), Chennai v. Customs & Central Excise Settlement Commission [2002 (139) E.L.T. 512 (Mad.)]. Submission of learned counsel for the petitioner is that the Settlement Commission can entertain an application only from such persons who approach the Commission with application for settlement in a situation where they come up with true disclosure even before the act of evasion is detected by the department and not such persons who are fence sitters and to take their chance and after they are detected and proceeded against approach the Settlement Commission with an application for settlement. Learned Counsel submits that in the present case, the respondent had in fact by himself declared the same, but was later detected to have cleared the goods not only declared and goods that had been seized and action taken in terms of the provisions of the Act and after show cause notice had been issued for levy of duty, proposi....
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.... is that many of the goods which were sought to be cleared by mis-declaring on the part of the respondent are covered by notifications issued under Section 123 of the Act; that in respect of such goods also the Commission cannot entertain an application at all in terms of the third proviso to Section 127B of the Act and therefore the impugned order deserves to be quashed. 16. Shri S.S. Hiremath, learned counsel for the respondent, on the other hand, submits that not all goods are notified goods in terms of Section 123 of the Act and not all goods are prohibited goods either; that many of the goods were permitted for import on payment of proper customs duty; that the respondent had in fact immediately volunteered to accept the valuation as well as the liability for payment of duty on such valuation; that the respondent had the benefit to invoke the jurisdiction of the Settlement Commission; that the Settlement Commission after taking into account the overall circumstance and the situation had passed a fare settlement proceedings; that no interference is called for in exercise of writ jurisdiction, as the matter has already been settled by the Commission and therefore the wr....
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....atute, has to be necessarily construed strictly. The scope of the provisions cannot be unduly enlarged if the intendment of the Legislature to provide for settlement in cases of short levy or non-levy on account of misclassification or misdeclaration also, as there is a vast and considerable distinction between cases of misclassification of goods and misdeclaration of goods. A misclassification of goods will only result in duty liability being at a different rate in terms of entry under which it is classified, whereas misdeclaration can be a situation of suppression, distortion and misrepresentation. In a situation of misclassification, only goods are disclosed or declared but goods are not properly classified for the purposes of determination of rate of duty, whereas in a case of misdeclaration, goods might not have been declared correctly at all, in the sense description is not of the actual goods also quantity may varying and mischief being deliberate and designed to avoid payment of customs duty. In case of misclassification, it may be bona fide case of wrong classification as the importer or the person clearing the goods may not be fully conversant with the Schedule to the Act....