Penalty Under Section 114AA Set Aside as No False Declaration Proven: CESTAT Delhi

Shivam Empire Vs Commissioner of Customs (CESTAT Delhi)

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi, adjudicated an appeal filed against an Order-in-Appeal dated 18.08.2023, which had partially allowed relief by reducing penalties but retained the redemption fine imposed on imported goods.

The case arose from the import of 1723 packages of “BRAD Nail” weighing 27,000 kilograms with an assessable value of ₹27,06,181. The importer filed the Bill of Entry on 12.02.2022. During assessment, it was found that the importer had not submitted the required Legal Metrology Packaged Commodities (LMPC) certificate and Steel Import Monitoring System (SIMS) certificate at the time of filing. The SIMS certificate had been obtained on the same date as the Bill of Entry, which violated the requirement of applying for registration between the 60th and 15th day prior to the expected date of arrival. The LMPC certificate was also submitted subsequently on 03.03.2022.

The adjudicating authority held that the importer violated Sections 46(4) and 46(4A) of the Customs Act, 1962 by failing to ensure compliance with required documentation at the time of filing. The goods were held liable for confiscation under Sections 111(d) and 111(o), and penalties were imposed under Sections 112(a)(i) and 114AA. The goods were allowed to be redeemed upon payment of a redemption fine of ₹3,50,000. Additionally, penalties of ₹2,25,000 under Section 112(a)(i) and ₹2,50,000 under Section 114AA were imposed.