Case Law Details
Kumar Impex Vs Commissioner of Customs (CESTAT Mumbai)
In the case of Kumar Impex Vs Commissioner of Customs, the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Mumbai examined the possibility of imposing penalties and redemption fine on an importer when the bill of entry for the imported goods has been finally assessed at its declared value. This dispute arose following inconsistencies identified by the Customs department in the description and thickness of imported goods.
Kumar Impex imported ‘PU coated fabric’ and sought a ‘first check’ from the Customs department. The department found discrepancies in the description and thickness of the goods, which initiated an inquiry. While the inquiry was ongoing, the appellant requested provisional release of goods against a PD Bond and a 100% bank guarantee of differential duty, which was granted. A show-cause notice was subsequently issued proposing to reject the declared value and re-determine it, impose a redemption fine, and penalize the importer under various provisions of the Customs Act, 1962.
The Adjudicating Authority confirmed the rejection of the declared value and the re-determination of value, along with imposing interest, penalty, and a redemption fine. However, on appeal, the Commissioner (Appeals) upheld the appropriation of duty paid by the appellant, along with redemption fine and penalties, despite setting aside the rejection of the transaction value and its re-determination.
During the CESTAT Mumbai proceedings, it was brought to light that the bill of entry was finalized as per declared value, prompting the question of the validity of imposed redemption fine and penalties. Since this development occurred after the Commissioner (Appeals)’s ruling, the matter was remanded back to the Commissioner for reconsideration.
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