TaxTMI 
TaxTMI 
2026 (1) TMI 1021
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....lls of Entry dated 30.10.2017 and 31.10.2017 to contain 'Wanli Brand' Chinese Tyres. Acting on specific intelligence, DRI examined the contents of the containers and found that against the declared 4,825 tyres, there were 9,681 tyres. Of these only 1,372 tyres were of the declared 'Wanli brand' which also had the mandatory Bureau of Indian Standards (BIS) mark. The remaining 8,309 tyres were actually old and used tyres (whose imported is restricted) of brands such as Bridgestone, Good Year, Dunlop, Continental, Yokohama, etc. None of these tyres also had the mandatory BIS mark. Neither the fact that the appellant had imported the tyres in these Bills of Entry nor the fact that the concealed old tyres were also smuggled along with the declared tyres is disputed by the appellant even before us. Therefore, these are undisputed facts. 4. DRI seized the entire consignment of tyres valued at Rs. 6,44,74,896/- under section 110 of the Customs Act, 1962 [Act] along with an amount of Rs. 4,00,000/- found in the possession of the appellant suspecting it to be sale proceeds of goods smuggled earlier. 5. After completing the investigation, DRI issued the SCN dated 26.4.2018 to four notic....
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....ies imposed by the Joint Commissioner; (viii) No penalty is imposable under section 114AA of the Act for violations related to imports and it is meant only for penalties for mis-declarations in exports; (ix) In the absence of Mens Rea, no penalty can be imposed under section 112(b) of the Act; (x) The penalty under section 112(b) cannot exceed 10% of the value of the duty sought to be evaded; (xi) The impugned order may be set aside insofar as it upholds the penalties under section 112(b) and 114AA on the appellant. Submissions on behalf of the Revenue 9. Learned authorized representative for the Revenue vehemently supported the impugned order and submitted as follows: (i) The import of the goods by the appellant and the mis-declaration of the goods in the Bills of Entry is not in dispute; (ii) The appellant acted on the instructions of Shri Bhaunshali and received Rs. 25,000/- per container; (iii) He had full knowledge the containers had undeclared and prohibited tyres; (iv) He obtained IEC, arranged clearance of the goods, fabricated transportation documents, managed warehouses and coordinated with Shri....
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..... 13. We accept submission of the learned counsel for the appellant that the appellant had sought but was denied cross-examination of the witnesses. Therefore, we ignore the statements made by different persons and relied upon in the SCN but only decide this case based on the undisputed facts of the case. 14. The only issues to be decided are whether the penalty of Rs. 50,00,000/- imposed under section 112(b) and penalty of Rs. 50,00,000/- imposed under section 114AA of the Act by the appellant can be sustained. These sections read as follows: "SECTION 112. Penalty for improper importation of goods, etc.- Any person, - (a) who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or (b) who acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111, shall be liable, - (i) in the case of go....
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....res were proposed to be confiscated under Section 111 and the declared tyres used to conceal them were proposed to be confiscated under section 119. As far as penalty under section 112 is concerned, the 1,372 tyres proposed to be confiscated under section 119 are not relevant. 16. The Joint Commissioner did not confiscate any of the tyres but recorded that the confiscation of these tyres was settled by the Settlement Commission as follows: a) Confiscated 35 old tyres imported under Bill of Entry No. 3811415 dated 30.11.2017 and 2437 old tyres imported under Bill of Entry No. 3813612 dated 31.10.2017 valued at Rs. 28,90,885/-and allowed them to be redeemed on payment of fine and re-exported. b) Confiscated 1,372 tyres of Wanli brand with BIS certification and allowed their redemption on payment of redemption fine. c) Confiscated 5,837 tyres without BIS marking valued at Rs. 3,87,36,764 under Bill of Entry no 3811415 dated 30.10.2017 and 3813612 dated 31.10.2017 and allowed their redemption on payment of a fine for re-export. d) Confiscated 2,472 used tyres valued at Rs. 20,47,601 imported under Bills of Entry no. 3811415 dated 30.10.2017 and 38....