Order allowing benefit U/s 28(6)(i) to importer company & MD and denying the same to CHA is not permissible: CESTAT [Read Order]

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Order allowing benefit U/s 28(6)(i) of the Customs Act,1962 to importer company & MD and denying the same to CHA is not permissible.

Refusal to extend benefits of sub-Section 6(i) of Section 28 of the Customs Act in concluding proceedings against the Appellant Customs Broker after differential duty with the required penalty was paid by the importer and confirmation of penalty of Rs.50,000/- against the Appellant under Section 112(A) of the Customs Act, 1962 by the Commissioner of Customs (Import).

M/s Damani Shipping Pvt. Ltd, the appellant as CHA had cleared the rotating tube bundle dryer and high-speed mixture with their accessories imported by M/s. Chandigarh Distillers & Bottles Ltd. by filing a bill of entry No. 5491717 dated 15.05.2014 and classifying the items under Customs Tariff Heading No. 8436 that attracted nil rate of CVD.

Special Intelligence and Investigation Branch investigated opined that the imported goods were supposed to be classified under CTH 8419 with 12.5% CVD.  Being informed importer discharged the duty liability with interest and also paid a penalty @25% of the duty.

Commissioner of Customs had absolved the importer and its Managing Director by extending the benefits contained in subsection 6(i) of Section 28 of the Customs Act but confirmed the penalty against the Appellant by holding that Circular No. 11/2016-Cus. excludes the application of such provision of deemed “conclusion of proceeding” against goods which were seized under Section 110 of the Customs Act or liable for confiscation on the other Sections of the Customs Act and the same benefit can’t be extended to the Appellant. 

It was observed that the proceeding against the then Managing Director of the importer by invoking the said provision contained in Section 28(6)(i) of the Customs Act but had not extended the same benefit to the Appellant despite the fact that both were charged under the same provision of the Customs Act.

A Coram of Dr Suvendu Kumar Pati, member (judicial) observed that the said Circular has not personified any violator individually since it had categorically stated that cases involving seizer and confiscation would be out of the purview of the Circula.

The Tribunal declared the order passed by the Commissioner as unsustainable in law and set aside the penalty while allowing the appeal. Shri Prashant Patenkar, Advocate appeared for the appellant and Shri D.S. Maan, Dy. Commissioner appeared for the respondent.

To Read the full text of the Order CLICK HERE

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