Custom, Excise & Service Tax Tribunal
M/S. Everest Ply & Veneers Pvt. Ltd vs Cc, Visakhapatnam on 25 October, 2016
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH AT HYDERABAD Bench SMB Court I Appeal No.C/344 & 345/2008 (Arising out of Order-in-Appeal No.7/2007 dt. 24/12/2007 passed by CC, Visakhapatnam) For approval and signature: Honble Ms. Sulekha Beevi, C.S., 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 Lordship wish to see the fair copy of the Order? 4. Whether Order is to be circulated to the Departmental authorities? M/s. Everest Ply & Veneers Pvt. Ltd. Shri Aman Garg ..Appellant(s) Vs. CC, Visakhapatnam ..Respondent(s)
Appearance Shri S. Raghu, Advocate for the appellant.
Shri Arun Kumar, Deputy Commissioner(AR) for the respondent.
Coram:
Honble Ms. Sulekha Beevi, C.S., Member(Judicial) Date of Hearing:25/10/2016 Date of decision:25/10/2016 FINAL ORDER No._______________________ [Order per: Sulekha Beevi, C.S.] The above two appeals involve the same issue, they were heard together and are disposed by this common order. The appellant is aggrieved by the redemption fine and penalties imposed.
2. The brief facts of the case are that the appellant M/s. Everest Ply & Veneers (P) Ltd. (EPVL, for short) filed a into-bond Bill of Entry dt. 27/02/2007 with Customs House, Visakhapatnam for import of 160 pieces of Gurjan Round Logs of Myanmar origin. The vessel arrived on 28/02/2007 and the logs were permitted to be removed to the bonded warehouse premises of M/s. Maha Maruti Logistics Pvt. Ltd. The entire logs had been transported from the vessel to the bonded warehouse during the period between 28/02/2007 and 04/03/2007. The logs / goods were waiting the examination by the Customs Officers. Based on specific intelligence, the DRI officers visited the bonded premises and found that 34 logs were removed from the bonded warehouse. It is alleged that the appellant removed 34 logs and also attempted to tamper the goods by way of cutting some of the logs lying in the warehouse before examination of the Customs Officers. It is the case of the Department that the appellant along with others visited the premises in the night of 07/03/2007 along with wood cutting machine and a generator and had cut some of the timber logs and applied paint to the cut edges and made some paint markings and left the premises in the early hours of 08/03/2007. Thereupon officers seized the entire stock of timber logs under Section 110 of Customs Act, 1962 and proceedings were initiated. The appellants paid the duty amount of Rs.1,19,890/- in respect of the 34 logs removed without approval of officers as well as on the remaining 126 logs on 08/03/2007 itself. After adjudication, the original authority confirmed the duty amount of Rs.1,19,890/- and confiscated the 34 numbers of timber logs valued at Rs.12,81,421/- giving an option to redeem the same on payment of redemption fine of Rs.2 lakhs. A penalty of Rs.1,10,000/- was imposed on the appellant besides imposition of penalty of Rs.50,000/- on Shri Aman Garg, the Director of M/s. EPVL. The appellants are thus before the Tribunal challenging the redemption fine and penalties.
3. On behalf of the appellant, the learned counsel Shri S. Raghu submitted that the appellant had removed the logs only for the purpose of technical testing and that there was no intention to evade payment of duty. He submitted that the appellant, M/s. EPVL is a manufacturer of plywood. That therefore the appellant would be eligible for credit on the customs duty paid and therefore no intention to evade payment of duty can be alleged against them. Further he submitted that the imposition of redemption fine of Rs.2 lakhs on the 34 pieces of timber logs is not legal since the goods are not available for confiscation and also for the reason that the appellant has paid duty upon these 34 numbers of logs. He pleaded to take a lenient view with regard to penalty imposed on the appellant as well as Shri Aman Garg.
4. On behalf of the respondent, the learned AR Shri Arun Kumar stressed the point that the appellants had interfered with the goods kept in the bonded warehouse. The appellants had tampered with the timber logs, which is established from the fact that they had brought wood cutting machine and generator into the bonded warehouse for cutting and sawing the logs into pieces. Further that the appellants had removed 34 numbers of timber logs from the bonded warehouse without filing ex-bond Bill of Entry and without payment of customs duty. He pleaded that the imposition of redemption fine and penalties are legal and proper.
5. I have heard both sides. The foremost issue that has to be addressed is whether the imposition of redemption fine of Rs.2 lakhs is legal for the reason that the goods are not available for confiscation. The learned counsel for appellant has relied on the judgment laid in Dev Anand Agarwal Vs. CC, New Delhi [2016(337) ELT 397 (Tri. Del.)]. In the said case, the co-ordinate Bench of the Tribunal has held that no redemption fine can be imposed when the goods are not available for confiscation. In the present case, it is undisputed that the goods were not available for confiscation. Therefore following the decision laid in the case of Dev Anand Agarwal, I hold that the imposition of redemption fine of Rs.2 lakhs is not within the provisions of law and therefore is set aside.
6. The next issue to be addressed is whether the penalty of Rs.1,10,000/- imposed on M/s. EPVL and Rs.50,000/- imposed on Shri Aman Garg are sustainable. From the narration of the facts, the acts committed by the appellants with regard to removal of logs, it has to be stated that there is some amount of intention to remove the logs without seeking permission and against the law applicable to the situation of bonded warehouse. The act of the appellants in bringing wood cutting machine and generator to the premises in order to tamper with the logs and cutting them into pieces before the inspection by the Customs officers has to be viewed seriously. On such grounds, I do not find any ground to interfere with the penalty imposed on M/s. EPVL. The penalty of Rs.1,10,000/- imposed on M/s. EPVL is sustained. However, the penalty of Rs.50,000/- imposed on Shri Aman Garg, in my view, is on the higher side. I consider that the imposition of penalty of Rs.20,000/- on Shri Aman Garg would meet the ends of justice. I order accordingly.
7. From the foregoing, in appeal No.E/344/2008, imposition of redemption fine is set aside and imposition of penalty of Rs.1,10,000/- is upheld. In appeal No.E/345/2008, penalty is reduced from Rs.50,000/- to Rs.20,000/-.
8. In the result, the appeals are partly allowed with consequential reliefs, if any.
(Pronounced and dictated in open court) SULEKHA BEEVI C.S. MEMBER(JUDICIAL) Raja.
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