Challenge against Penalty Imposed under Customs Act: Telangana HC directs to appeal before CESTAT [Read Order]

The Telangana High Court directed to appeal before the Customs, Excise Service Tax Appellate Tribunal (CESTAT)on the challenge against penalty imposed under the Customs Act, 1961 . Zeta International, the petitioner the petitioner are that the petitioner filed three white shipping bills for export of Printed Circuit Boards (PCBs) to Dubai, which were examined by the officers of Air Cargo, Customs, Hyderabad, and LET Export Order dated 12.02.2019, was passed. How to Audit Public Charitable Trusts under the Income Tax Act CLICK HERE Based on some intelligence input received by the Directorate of Revenue Intelligence (DRI), Hyderabad Zonal Unit, that the alleged good were of substandard quality and were highly inflated, the said consignment was requested to be examined. Read More: Failure to file Annual Returns for the FY 2020-21: MCA imposes Penalty of Rs. 5.6 Lakhs on Company and Directors On 16.09.2019 (Annexure R5 with rejoinder), the consignment was examined by the DRI, vide panchanama dated 16.09.2019. The Chartered Engineers on the same day examined 19136 pieces in the consignment at the behest of DRI officers so as to ascertain the nature of the PCBs. After examination of the goods, the same were seized by the DRI vide order dated 16.09.2019 under Section 110(1) of the Customs Act, 1962. The petitioner was served with show cause notice dated 05.03.2020 by the Joint Director, DRI New Delhi. The petitioner preferred representations dated 28.08.2020 and 04.09.2020 and requested to provide additional documents which were relevant for the purpose of adjudication of the matter. On 14.09.2020, the petitioner submitted a detailed interim reply to the show cause notice and asked for permission to cross-examine the Chartered Engineers, who conducted the valuation and submitted the report thereof dated 16.09.2019. It was also prayed for cross-exarnination of Panchas Df the panchanama dated 16.09.2019. On 22 .12.2020, personal hearing was granted to the petitioner and it specifically reiterated its request fior crossexamination of the Chartered Engineers and the Panchas. On 31.12.2020, Order-in-Original was passed and the value of 3 PCBs sought to be exported under shipping bill was rejected and held to be NIL. The gocds were absolutely confiscated and penalty was imposed upon the petitioner. The petitioner preferred an appeal on 05.03.2021 against the aforesaid Order-in-Original dated 31.12.2020 before respondent No. 2. Respondent No. 2, on 21.06.2021, set aside the impugned Order-in-Original and directed the authority below to consider the matter afresh in accordance with the principles of natural justice. Want a deeper insight into the Income Tax Bill, 2025? CLICK HERE In turn, on 26.1 1.2021, respondent No. I Ineld that the matter was examined afresh and declined the praver of the petitioner seeking cross-examination of the Chartered Engineers and Panchas. The petitioner, against the aforesaid order, filed a second appeal before respondent No.2 on 24.02.2022. The petitioner was given a personal hearing before respondent NO. 1 on 12.05.2022 in the Order-in-Original proceedings. The petitioner informed the authority that its appeal is pending consideration before the appellate authority against the order dated 26.1 1.2021. But, the said authority did not agree with the petitioner's request and after granting personal hearing on 15.07.2022, passed the impugned Order-in-Original dated 31.10.2022, whereby the penalty of Rs. (ten times of the penalty in Order-in-Original dated 31.12.2020) was imposed on the petitioner. The petitioner submitted that when the petitioner's appeal against the order dated 26.11.2021 was pending consideration, in all fairness, the authority should have waited for the outcome of the said appeal. However, the authority had decided the matter in the same manner and without assigning adequate reasons as to why the Chartered Engineers and Panchas should not be permitted to be cross examined, passed the impugned Order-in-Original. Read More: Supplies Amid Imports and IGST over Inter-State Trade & Supplies have similar Tax Rate: CESTAT The bench observed that it is not in dispute that there exists a statutory alternative remedy to the petitioner. This is also not in dispute that based on the same fact situation in the Order in-Original dated 31.12.2020. The Delhi High Court in Ashish Bansal ruled that "9. Considering that the petitioner has a remedy of appeal before the Customs Excise and Service Tax Appellate Tribunal (hereafter 'Tribunal'), we do not consider it apposite to examine the petitioner's challenge to the impugned order in this petition. However, giwen the manner in which the penalty has been compu ted and the financial condition of the petitioner, we consi der it apposite to direct the Tribunal to consider the petitioner's appeal without any pre-deposit. " Tax Planning For NRIs - CLICK HERE The Acting Chief Justice Swoy Paul and Dr. Justice G.Radha Rani disposed of the writ petition with the direction to the petitioner to prefer an appeal against the impugned Order-in-Original dated 31.10.2022 within three weeks from today. It was further held that “ If the petitioner undertakes the aforesaid exercise of filing the appeal within the aforesaid time and deposits the amount as stated above, the learned appellate authority shall make endeavour to decide the appeal expeditiously.” Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates

Challenge against Penalty Imposed under Customs Act: Telangana HC directs to appeal before CESTAT [Read Order]

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