Case Law Details
Honda Cars India Limited Vs Principal Commissioner of Customs (CESTAT Delhi)
In the case of Honda Cars India Limited Vs Principal Commissioner of Customs, the appellant, Honda Cars India Limited, imported drawings and designs on paper made with the aid of computer between April 2016 to March 2018. They filed Bills of Entry, claiming classification of the goods under Customs Tariff Item (CTI) 4906 00 00 and sought exemption from payment of Basic Customs Duty (BCD) under certain notifications. An investigation by the Directorate of Revenue Intelligence (DRI) concluded that the goods should be classified under CTI 4911 99 20, not the classification claimed by the appellant. The appellant admitted the misclassification and deposited the differential BCD and interest. The Customs department initiated proceedings seeking confirmation of the differential duty, interest, and penalties.
The appellant argued that penalties under Section 114A of the Customs Act, 1962, couldn’t be imposed as there was no collusion or wilful misstatement. They also claimed they should benefit from the reduced penalty of 15% of the BCD amount, paid within thirty days of receiving the show cause notice (SCN).
The Revenue argued that penalties were justified as the differential BCD was paid during the investigation. They contested the applicability of the reduced penalty, stating it wasn’t paid within the prescribed timeframe.
The Tribunal considered both arguments and examined the case records. It noted that the appellant accepted the DRI’s classification without contesting it and voluntarily paid the differential BCD and interest. The reduced penalty under Section 28(5) of the Customs Act was also paid by the appellant. The Tribunal found the department’s invocation of penal provisions under Section 114A justified.
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