IN THE HIGH COURT OF JUDICATURE AT BOMBAY, while deciding on 24.9.09 the Customs Application No.9 of 2001 in re: COMMR. OF CUS. [PREVENTIVE] vs LEELA SCOTTISH LACE PVT. LTD, it was held as follows:-

QUOTE: It would be clear that what the Supreme Court has held that Clause (o) of Section 111 of the Act contemplates confiscation of goods which were exempted from duty subject to a condition which is not observed by the importer within the time prescribed. The occassion for the action under this clause arises only when the condition is not observed within the period prescribed. In the instant case, the respondents had not cleared the goods. The Bill of Entry was filed by some other person. Therefore, the question of breach of condition by the respondents would not arise. What Section 111(o) of the Act reiterates is “the condition is not observed”. The stage for observing the condition had not yet arisen as the goods themselves had not been clered by the respondents. In our opinion, therefore, the learned Tribunal was right in placing reliance on the judgement of the Supreme Court in the case of SAMPAT RAJ DUGAR [UNION OF INDIA vs SAMPAT RAJ DUGAR - 1992-58-ELT-163-SC] UNQUOTE

[for full text of the judgement please visit http://www.taxesinindia.com and click on the citation taxind_2009_hc_bom_cusa_9]

HIGH COURT ORDER

VENKATRAMAN RAGGHUPATHY, Web admin.

HIGH COURT JUDGEMENTS confiscation, CUSTOMS ACT 1962, PENALTY, SEC 111(O)

CESTAT KOLKATA BENCH, while passing the final order no.A718 on 04.12.09 in re: IOCL HALDIA REFY vs CCEX HALDIA observed as follows: -

QUOTE: The Honble Supreme Court in the case of UOI vs RAJASTHAN SPINNING & WEAVING MILLS [2009-238-ELT-3 (SC) held that the application of Section 11AC would depend upon the existence or otherwise the conditions expressly stated in the Section, once the Section is applicable in a case the concerned authority would have no discretion in quantifying the amount of penalty. In the present case I find that even in the show cause notice there is no whisper of fraud, collusion or any willful misstatement or suppression of facts with intent to evade payment of duty. In order to attract the provisions of Section 11AC of the Act it must be alleged in the show cause notice that the duty had not been levied or paid by reason of fraud, collusion or willful misstatement or suppression of facts or by reason of contravention of any provision of Act or Rules with intent to evade payment of duty. In the present case the excess duty paid and adjustment of the same was reflected in the monthly returns. In these circumstances I find merit in the contention of Appellant and in view of the above decision of Honble Supreme Court the penalty imposed under Section 11AC is not sustainable hence set aside. Appeal is allowed. UNQUOTE

[for full text of the judgement please visit http://www.taxesinindia.com and click on the citation taxind_2009_ezb_A718]

CESTAT ORDER

VENKATRAMAN RAGGHUPATHY, Web admin.

CESTAT ORDERS INTENT TO EVADE DUTY, PENALTY, SECTION 11AC OF C.EX. ACT