M/s M S C Agency India Pvt Ltd vs Commissioner Of Customs, Ludhiana

The appellant is in appeal against the impugned order wherein the penalty of Rs. 1,00,000/- has been imposed under Section 112 of the Customs

Act, 1962 on the ground of mis-declaration of goods in description as well as in quantity in bills of landing.

The facts of the case are that one consignment was imported by one importer namely M/s Kuber Castings Pvt Ltd and declared the weight of the

imported goods in the bill of entry as 423.580 MTs for heavy melting steel scrap. On physical verification of the goods, it was found that it is 487.670

MTs of re-rollable steel scrap. During the investigation, the draft bills of landing were submitted wherein the imported goods were declared as re-

rollable steel scrap weighing 490.580 MTs . In these sets of circumstances, a penalty of Rs. 1,00,000/- was imposed on the appellant for mis-

declaration of weight and description of the goods. Against the said order, the appellant is before me.

The ld. Counsel for the appellant submits that in their own case M/s M S C Agency India Pvt Ltd vs. Commr. of Cus. (Seaport-Import), Chennai

reported in 2014 (312) ELT 65 (Tri. Chennai), this Tribunal has observed that when the seal of the container was intact, in that circumstance, penalty

on the shipping line cannot be imposed. He also relied on the decision of this Tribunal in the case of S.K. Colombowala vs. CC (Import) Mumbai

reported in 2007 (220) ELT 492 (Tri. Mumbai) to say that when the main importer has gone to the Settlement Commission, therefore, the matter ends

and no penalty is imposable on the appellant.

On the other hand, the ld. AR opposes the contention of the ld. Counsel and submits that it is a case of mis-declaration of description and weight of

the imported goods in bills of landing by the appellant, therefore, penalty is rightly imposable. He also submits that the case of S.K. Colombowala

(supra) cannot be relied upon, as penalty has been imposed on the appellant on separate grounds, therefore, if the importer goes to the Settlement

Commission, the appellant cannot take the benefit of the wrong done by the appellant. To support this contention, he relied on the following decisions:

(i) Shree Naklank Ltd vs. CESTAT Ahmedabad â€" 2019 (365) ELT 407 (Guj)

(ii) Yogesh Korani vs. UOI â€" W.P. No. 1458 of 2002 dt. 08.10.2002 (Bombay H.C.)

(iii) Decent Laminates Pvt Ltd vs. CCE Vadodara â€" 2018 (361) ELT 896 (Tri. Ahmd)

(iv) Mamta Garg vs. CCE Noida â€" 2018 (359) ELT 77 (Tri. Delhi)

(v) CC (Imports) Mumbai vs. Patvolk â€" 2006 (202) ELT 411 (Bom.)

(vi) Motilal Gupta vs. CCE Thane â€" 2016 (337) ELT 462 (Tri. Mumbai)

Heard the parties and considered the submissions.

After hearing the parties, it was asked by the ld. AR “please let me know whether the seal of the container was intact or not?†This was

answered in affirmative. As the fact has not been disputed by the Revenue and the mis-declaration of weight and description of the goods was found

at the time of physical examination of the goods. In that circumstances, relying on the decision in the case of M/s M S C Agency India Pvt Ltd (supra)

wherein this Tribunal has observed as under:

“10. We have considered submissions on both sides and perused the records. Revenue has not brought out anything on record to show

that the shipping line was aware of the misdeclaration regarding the contents of the containers. It is not in dispute that the containers were

brought with seals intact. It is also evident that the importer and the shipper agreed that the misdeclaration of cargo happened before the

goods were placed on board and not in the custody of shipping line. Against such facts and circumstances this is not a case of short landing

but is more appropriately to be considered a case of short shipment. Based on such facts and considering the decisions of the High Courts

cited by the Counsel especially that in Shaw Wallace & Co. Ltd. (supra) the impugned order passed against the appellant is not

maintainable. So we set aside the order and allow the appeal.â€​

I hold that penalty on the appellant cannot be imposed. The said decision is based on the decision of Hon’ble Madras High Court in the case of

Container Corporation of India Ltd. v. Priya Dyes & Chemicals - AIR 2013 Mad. 85 and the decision of Hon’ble Bombay High Court in the case

of Shaw Wallace & Co. Ltd. v. Asstt. Collector - 1986 (25) E.L.T. 948 (Bom.).

In view of the above discussion, I do not find any merit in the impugned order. The same is set aside qua penalty imposed on the appellant only.

In result, the appeal is allowed with consequential relief, if any.

(Dictated and pronounced in the open court)