Customs – Cestat Mumbai: Confirmation of penalty, after 15 years of issue of show-cause notice is unsustainable both in law and facts – The alleged occurrence had taken place way back in 1992, and in such circumstances with possibility of evidence fading away over the ages, Appellant deserves to be relieved from his liability - Appeal allowed [Order attached]
Order date – 25 November 2022
- The Appellants, M/s. Citibank N.A. and Mr. Mafatlal R. Mehta, where M/s. Citibank is engaged in carrying on activities of banking services at its various branches located in India and it had purchased 12 numbers of ATMs and 6 ATMS Controllers in July, 1998 from M/s. Philips India.
- On 11.09.1992 show-cause notice was issued on the allegation that those ATMs and ATMs Controllers were supplied by M/s Philips India to the Appellant after the same being imported by a company’s/firm of Mr. Jiten P. Mody by mis-declaration of description and value of goods in violation of Import Policy and without Import Licence.
- The notice also proposed for confiscation of machines under Section 111(d) and (m) of the Customs Act, 1962 and penalty. Penalty for two consignments were also imposed on Appellant Mr. Mafatlal R. Mehta, the Customs broker without any show-cause notices being issued to him.
- Whether Confirmation of penalty, after 15 years of issue of show-cause notice on the Appellant, under Section 112 of the Customs Act is in order?
- The Tribunal observed the copy of the letter of DRI which clearly indicates that show-cause notice was not received by Appellant Mafatlal R. Mehta, and the same letter of DRI was issued upon perusal of their own records.
- Further, it also indicates that there was no proof of service of intimation of personal hearing of notices on Appellant Mafatlala R. Mehata. Unfortunately, he has been penalised in gross violation of the principles of natural justice. In the normal course, an opportunity could have been given to him for a de novo adjudication after compliance of service of show-cause notice and personal hearing but in the instant case Appellant is an AIDS patient and is in the terminal stage of his sickness. Further, the alleged occurrence had taken place way back in 1992.
- In such circumstances, with possibility of evidence fading away over the ages, Appellant Mafatlal R. Mehta deserves to be relieved from his liability, which going by the case record would clearly reveal that a general allegation of abatement against him without a clear finding was only leveled against him for his involvement during clearance of goods from Customs as a Customs broker.
- The Tribunal observed that in respect of Appellant bank, it is a transaction concerning purchase of an item within India, which is unrelated to its importation and to the importer as the said transaction is confined between the Appellant Citibank and M/s. Philips India, confirmation of penalty under Section 112 of the Customs Act against this Appellant is unsustainable both in law and facts.
- Hence the appeals are allowed.