M/S. Rajat Industries P Ltd vs Commissioner Of Customs

[Arising out of Order-In-Appeal No. DLI-CUSTM-TKX-APP-756-14-15 dated 05/12/2014 passed by Commissioner of Customs, (Export), , ICD, Tughlakabad, New Delhi]

For approval and signature:

Honble Mr Ashok Jindal, Member (Judicial)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

M/s. Rajat Industries P Ltd. Appellants

Vs.

Commissioner of Customs Respondent

New Delhi

Appearance:

Shri R S Yadav, Consultant for the Appellants

Shri R K Grover, AR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Date of Hearing /decision: 26.08.2015

ORDER NO. FO/52708/2015-Cus (SM)

Per Ashok Jindal :

The appellant is in appeal against the impugned order imposing redemption fine and penalty on them.

2. The brief facts of the case are that appellant is a manufacturer of Gutkha under the brand name of kolhapuri. The appellant filed shipping bill on 1.8.2012 declaring the total quantity of pouches of gutkha as 57,24,000. During the course of inspection, four cartons were opened and examined on random basis and it was found that there was variation in the quantity shown in the packing list and physical quantity. Therefore, matter was referred to Special Investigation and Intelligence Branch for 100% check. On 100% check, it was found that physical quantity of gutkha is 41,97,600 pouches. There is short quantity of 15,26,400 pouches. Therefore, the allegation of mis-declaration was alleged against the appellant and for confiscation of the goods. Various statements of the appellants representative were recorded. Thereafter, the adjudicating took place. In adjudication, it was held that the goods have been mis-declared and therefore, liable for confiscation which were provisionally released for export on payment of redemption fine, so imposed, to the tune of Rs.12 lakhs and penalties under section 114(iii) and 114 AA were imposed of Rs.2 lakh each. The said order was confirmed by the learned Commissioner (Appeals). Aggrieved from the said order, appellant is before me.

3. Learned Counsel for the appellant submits that the appellants have no intention to mis-declare the quantity of goods and the appellant has already foregone the rebate claim on the said exported goods and there was no allegation against the appellant that they have intentionally mis-declared the quantity of export goods. In these circumstances, the goods are not liable for confiscation, consequently imposition of penalties and redemption fine are not sustainable.

4. On the other hand, learned AR submits that on physical verification, the quantity of export goods were found short by almost 30% and the contention of the appellant that they have foregone the rebate claim was an afterthought and it was only after detection of shortage of export goods. Therefore, the appellant has intentionally mis-declared the export quantity of goods. In these circumstances, the export goods are rightly held by both the lower authorities as liable for confiscation and redemption fine and penalty was rightly imposed on the appellant.

5. Heard the parties. Considered the submissions.

6. In this case, it is a fact on record that on physical verification, there was shortage of quantity of export goods to the tune of around 30%. If the goods were not checked at the time of export, the appellant could have shown the quantity of export goods as shown in the shipping bill as correct and had availed rebate claim thereon. It is only after detection of the shortage of quantity, the appellant sought to forego the rebate claim. Therefore, the excuse of the appellant that they have to meet export obligation and their labour was in hurry and has packed less quantity of export goods in the containers is not sustainable. In these circumstances, the charge of mis-declaration of quantity of good by the appellants stands proved. Therefore, the lower authorities have rightly held that the export goods are liable for confiscation. In the impugned order, the redemption fine of Rs.12 lakh has been imposed on the appellant whereas the quantity in number found short is 15,26,400 pouches, which I find is appropriate. Therefore, redemption fine of Rs.12 lakh imposed on the appellant is confirmed. Further, I find that penalty of Rs.2 lakh each has been imposed on the appellant under section 114(iii) and 114AA of the Act, which I find in the facts of the case is excessively high. Therefore, I reduce it to Rs.One lakh each under section 114(iii) and Section 114 AA of the Act.

7. With these terms, appeal is disposed of.

(Dictated and pronounced in the open court )

( Ashok Jindal ) Member(Judicial)

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