TaxTMI 
TaxTMI 
2026 (2) TMI 1169
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....3 [impugned order] passed by the Principal Commissioner of Customs, Air Cargo Complex (Import), New Delhi in which she confirmed the demand of Rs. 48,04,268/- under section 28 (4) of the Customs Act, 1962 [the Act] invoking extended period of limitation along with interest. She also dropped demand of Rs. 37,16,287/- against which there is no appeal by the Revenue. She held that goods valued at Rs. 3,74,14,130/- were liable to confiscation under section 111 (m) of the Act, but refrained from imposing any redemption fine. In respect of the goods imported by Bill of Entry No. 6856591 dated 12.02.2020, she imposed a fine of Rs. 8,10,000/- in lieu of confiscation in terms of the bond executed for their provisional release. She imposed a penalty ....
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....ct and section 114A of the Act. 5. The proposals in the show cause notice were decided by the Principal Commissioner in the impugned order confirming demand of only Rs. 48,04,268/- and further imposing a redemption fine in respect of the Bill of Entry dated 12.02.2020, which goods were released provisionally on bond. She also imposed penalty under section 114A. 6. The appellant had been classifying the servers which it imported under CTI 8471 50 00 and claiming the benefit of Notification No. 24/2005-CUS (Sl. No. 8). The case of the department in the show cause notice and in the impugned order is that they were correctly classifiable under CTI 8517 69 90 and were not eligible to the exemption notification. This is the crux of the disp....
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....voked. He, therefore, submits that only demand of duty within the normal period of limitation i.e., within two years from the date of show cause notice could have been confirmed. 9. It is further submission of the learned counsel for the appellant that section 111 (m) does not provide for confiscation of goods for incorrect classification or claiming the benefit of an exemption notification. Therefore, the order confiscating the seized goods and holding the goods imported under previous Bills of Entry liable to confiscation are not correct. 10. It is his further submission that the penalty under section 114A can be imposed only if the non-payment or short payment of duty was by the reason of collusion or any willful mis-statement or s....
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....assified under CTI 471 50 00. 13. For these reasons the invocation of extended period of limitation was justified and so was the confiscation of the goods and imposition of penalty. 14. We have considered the submissions advanced by both sides and perused the records. 15. Insofar as the classification of the goods and the benefit of the exemption notification are concerned, there is no dispute. The department's classification of the goods is correct and is undisputed. 16. The next question is to be answered is whether classifying the goods under an incorrect CTI during self-assessment of the Bill of Entry can be a ground to invoke extended period of limitation under section 28 (4) of the Act or otherwise. We find that the extend....
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....ry in terms of section 28 (4) of the Customs Act". 17. In the impugned order, the Commissioner relied on the decision of this Tribunal in the case of Ajay Poly Pvt. Ltd. versus CCE [2018 (363) E.L.T. 1014 (Tri. - Del.)] in which changing of classification in the excise returns for subsequent periods in order to lower duty was held to be intentional and hence extended period of limitation was correctly invoked in that case. Applying the ratio, the Commissioner held that extended period of limitation was correctly invoked. 18. We have considered this question of invocation of extended period of limitation. 19. The show cause notice invoked extended period on the ground that the mis-classification of the goods came to light only on in....
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....tion under section 28 (4) of the Act, the penalty imposed under section 114A also needs to be set aside. 23. Next is the question of confiscation of the goods or holding the goods liable to confiscation and consequently imposition of redemption fine. Section 111 (m) of the Act reads as follows :- "SECTION 111. Confiscation of improperly imported goods, etc. - (m) any goods which do not correspond in respect of value or in any other particular with the entry made under this Act or in the case of baggage with the declaration made under section 77 in respect thereof, or in the case of goods under transhipment, with the declaration for transhipment referred to in the proviso to subsection (1) of section 54" 24. The above....