Naresh Vijayvargiya Vs Principal Commissioner of Customs (CESTAT Delhi)
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi, has set aside a penalty of Rs. 50 lakhs imposed on Naresh Vijayvargiya, former Chief Financial Officer of MMTC-Pamp India Pvt. Ltd., in a case involving alleged customs duty evasion on imported gold dore bars. The tribunal ruled that a mere mismatch in gold content between initial and final invoices, without proof of a conscious effort to evade duty, is not sufficient to attract penalty under Section 112(a)(ii) of the Customs Act, 1962.
The case originated from an order by the Principal Commissioner of Customs, ACC (Import), New Delhi, which imposed the penalty on Mr. Vijayvargiya. The penalty was levied under Section 112(a)(ii) of the Customs Act, which provides for penalties on persons who, through their actions or omissions, render goods liable for confiscation or abet such acts, in the case of dutiable goods where there is an intent to evade duty. The Principal Commissioner had held Mr. Vijayvargiya liable on the grounds that, as the finance head, he was aware of discrepancies between invoice values but failed to inform the customs department. This omission was deemed to have rendered the goods liable for confiscation, thus attracting the penalty.
