Custom, Excise & Service Tax Tribunal
M/S Essar Oil Limited vs Commissioner Of Customs on 5 May, 2015
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, Ahmedabad Appeal No. : C/13019-13031/2014 [ Arising out of OIA-165-177-2014-CUS-COMMR-AJMR dtd 8.5.2014 Passed by Commissioner of CUSTOMS-JAMNAGAR(PREV) ] M/s Essar Oil Limited - Appellant (s) Vs. Commissioner of CUSTOMS- - Respondent(s)
JAMNAGAR(PREV) Represented by For Assessee : Shri Nikhil Rungta, Advocate.
Ms Dimple Gohil, Advocate For Revenue : Shri S K Shukla, Authorised Representative For approval and signature :
Mr. H.K. Thakur, Honble Member (Technical) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes CORAM :
Mr. H.K. Thakur, Honble Member (Technical) Date of Hearing / Decision : 5/5/2015 ORDER No. A/ 10507-10519/2015 dtd 5/5/2015 Per : Mr. H K Thakur;
All these appeals have been filed by the appellant with respect to OIA Nos 165-177/2014/CUS/COMMR(A)/JMR dtd 8.5.2014. Under these orders the First Appellate Authority has held that penalty is required to be imposed upon the appellant under Regulation 5 of the Customs (Provisional Duty Assessment) Regulations 2011 and not under Section 117 of the Customs Act 1962. However, he reduced penalties imposed upon the appellant with respect to certain appeals filed by the appellant.
2. Shri Nikhil Rungta, Learned Advocate, appeared on behalf of the appellants and argued that the show cause notices issued to the appellants proposed penalty under section 117 of the Customs Act 1962 with respect to each Bill of Entry. The Commissioner (appeals) has held that the penalties are required to be imposed under Regulation 5 of the Customs (Provisional Duty Assessment) Regulations 2011. It was the case of the appellant that once the show cause notices, proposing penalty under Section 117 of the Customs Act 1962, have been issued, penalties cannot be imposed under Regulation 5 of the Customs Regulations 2011. It was also his case that it was a practice in the Customs House for imports of Crude Oil by the appellant that the required documents were produced after a period of one month and differential duty was paid by the appellant. That as per the prevailing practice no penalties were imposed upon the appellants for late filing of documents. Learned Advocate Shri Nikhil Rungta, made the Bench go through the provisions of Customs Regulations 2011 and argued that the Regulation 3 only prescribes the conditions of the Bond which is required to be executed by an importer. That in reply to the show cause notices, the appellant explained the practise prevalent in the Customs house and requested that the period required till furnishing of the documents should be extended by the Adjudicating Authority as required under the Custom Regulations 2011.
3. Shri S K Shukla, Authorised Representative, appearing on behalf of the Revenue argued that offence committed by the appellant has remained the same; therefore, it does not make any difference, if penalty is imposed under Section 117 of the Customs Act 1962 or under Regulation 5 of the Customs Regulations 2011. So far as extension of period for submitting the required documents, it was argued by the Learned Authorised Representative that the appellant has been requesting for provisional assessment and it was the duty of the appellant to seek suo-moto extension of time for filing the documents. It was, therefore, strongly argued by the Learned Authorised Representative that the penalties have been correctly imposed by the Adjudicating Authority under Regulation 5 of the Customs Regulations 2011.
4. Heard both sides and perused the case records. The appellant was importing Crude Oil for which assessments were made provisional subject to production of certain documents. From the records, it is observed that the nature of documents etc. was such that the same could not be produced within a period of 30 days. It is the case of the appellant that for the earlier period also such documents were furnished after a period of 30 days from the date of provisional assessment and no penalties were imposed upon the appellant and that it was practically imposable for furnishing the required documents within one month. It was also the case of appellant that even if the appellant requested for extension of time for filing the required documents in reply to the show cause notices the same could have been allowed by the Adjudicating Authority under the Customs Regulations 2011 as the earlier practice followed by the appellant was not disputed. It is seen from the Customs (Provisional Duty Assessment) Regulations 2011 that as per Regulations 3(3) where the assessment is allowed provisionally pending production of certain documents, a Bond is required to be given which shall contain an undertaking that the importer shall produce such documents within one month on any further period extended by the proper may allowed. There is no mention of an application required to be filed by the importer to seek extension. Further, as per Regulations 3(3) and 5 an importer who violates any of the provisions of these Regulations shall be liable to penalty. At the same time, Regulation 3(3) conveys production of documents within one month or within such extended period as the proper officer may allow. In the present proceedings, the appellant had paid the customs duty, if any, and there is no proceedings regarding the demand of duty which is not paid by the appellant as per the provisions of Customs Regulations 2011. There is no time limitation prescribed for seeking extension. It is opined that the Adjudicating Authority should have extended the period as requested in Para 9 (reproduced blow) in appellants reply dt. 15.1.2014 to the show cause notice dt. 30.9.2013.
We, therefore, request your goodself to take into account the aforesaid facts and be kind enough to finalise the assessment without imposing any penalty. It is also prayed that if your goodself feels that the condition of the PD Bond, as extracted above, has been contravened then your goodself may in exercise of the power vested with your Honour extended the period within which the said information/documents ought to have been furnished and regularise the entire matter.
5. Appellant has relied upon the following cases in support of the argument that it is not necessary that the penalty should be imposed in each case when there is no positive evidence of any mala fide intention.
1. Libra Exporters vs. Collector of CE 1991(53)ELT.433 (Tri.)
2. Syndicate Shipping Services Pvt Ltd Vs. CC, Chennai 2003(154)ELT.756 (Tri.Chennai)
6. In view of the above settled proportion of the law when seen alongwith the facts of these proceedings, it is observed that there is no mala fide intention on the part of the importer to evade any duty and was following a practice. Appellant in reply to the show cause notices asked for extension of time which the Adjudicating Authority should have allowed.
7. It is also observed from the case records that the Adjudicating authority imposed penalties under Section 117 of the Customs Act 1962 by penalties so imposed were held to be imposable only under Regulation 5 of the Customs (Provisional Duty Assessment) Regulations 2011. This was not the subject matter of the show cause notices. Therefore, above findings arrived at by the First Appellate Authority are required to be rejected, as he cannot go beyond the scope of show cause notices when the same is not agitated by the Revenue. Revenue has also not filed any appeal against the orders passed by the First Appellate Authority.
8. In view of the above observations, appeals filed by the appellants are allowed with consequential relief, if any.
(Operative part pronounced in the Court) (H.K. Thakur) Member (Technical) swami ??
??
??
??
5