Court decision

The Tribunal allowed both appeals: it set aside the confiscation of the goods and the redemption fine as unsustainable, set aside the Section 114A penalty on the importer, held no penalty imposable on the custodian under Section 114A, and set aside the Commissioner (Appeals)'s remand order, granting consequential relief as per law.

Facts

M/s Vinayak Oil & Fat Pvt. Ltd. imported bulk Crude Degummed Soya Bean Oil (CDSBO) discharged into a shore tank at Haldia operated by custodian M/s Aegis Logistics Ltd., and filed a Bill of Entry for 1,453.650 MT, but ~45.189 MT (49.330 MT per tank measurement) of excess oil was found in the tank. Customs detained the goods; the excess was later cleared on a bond of Rs.7,00,000 and bank guarantee of Rs.10,38,396 for differential duty. A Show Cause Notice dated 13.05.2019 proposed confiscation of 45.189 MT and penalties under Sections 112(a)/(b) read with 114A on both parties. The adjudicating authority confiscated the goods under Sections 111(j), 111(i)/(l) and 111(m), imposed a Rs.6,00,000 redemption fine under Section 125, appropriated Rs.10,38,396, and levied a Rs.10,38,396 penalty on each appellant under Section 114A. The Commissioner (Appeals) upheld this against the importer but set aside the custodian's Section 114A penalty and remanded its case for de novo adjudication, prompting both cross-appeals to the Tribunal.

Key provisions

• Section 114A, Customs Act, 1962 — Penalty for short-levy or non-levy of duty in certain cases
• Section 112(a), Customs Act, 1962 — Penalty for improper importation of goods
• Section 111(j), Customs Act, 1962 — Confiscation of improperly imported goods etc
• Section 114, Customs Act, 1962 — Penalty for attempt to export goods improperly etc
• Section 128A, Customs Act, 1962 — Procedure in appeal