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Subject News *  Documentary evidence dominates probe, further custody unwarranted: mumbai court grants bail in Rs. 22.44 crore customs duty evasion case. *  Business premises can’t remain sealed for non-participation in GST search: Allahabad High Court. *  GST pre-deposit must be refunded proportionately when taxpayer partly succeeds in appeal: Bombay High Court. *  Supreme Court grants 30 days to file GST appeal; keeps pre-deposit issue open due to deposit in parallel CGST proceedings. *  GST demand can’t exceed amount proposed in SCN: Allahabad High Court quashes Rs. 20.47 Crore order. *  Hundreds-of-crores GST demand and heavy 10% pre-deposit no ground to bypass statutory appeal: Punjab & Haryana High Court. *  Delhi High Court refuses to entertain challenge to gold confiscation due to statutory appeal remedy and unexplained delay. *  Procedural error in customs broker licence inquiry can be rectified through remand: Delhi High Court. *  GSTR-2A mismatch alone can’t justify ITC denial without invoice-wise verification; personal hearing mandatory: GSTAT. *  GST order passed without uploading personal hearing notices violates sec. 75(4): Allahabad High Court. *  TAX EVASION - Sec. 74 GST SCN quashed for not spelling out fraud, wilful misstatement or suppression: Allahabad High Court. *  STPI’s SOFTEX certification and NoC charges taxable as business support services: CESTAT. *  Suspicion can’t replace proof: CESTAT quashes penalty in alleged gold-smuggling operation. *   Limitation runs from communication of order: Madras High Court upholds rejection of delayed GST Appeals. *  Rajasthan High Court quashes GST demand over unsigned show cause notice. *  ITC recovery upheld where supplier failed to deposit GST: Rajasthan High Court. *  Customs commissioner’s empowered to make port trust liable for duty on pilfered goods: Supreme Court. *  Rectification proceedings can’t be used to challenge an uncontested GST assessment through a writ petition: Andhra Pradesh HC. *  GST proceedings against deceased proprietor unsustainable without notice to legal heir: GSTAT. *  Mere availment of ineligible self-assessed ITC doesn’t amount to suppression without evidence of fraud or wilful misstatement: GSTAT. *  Disposal of mining overburden by entity authorised by mining lease holder constitutes taxable service: CESTAT. *  Toll plaza data not mandatory for ITC refund: GSTAT. *  Disputed GST fraud allegations require investigation: Punjab and Haryana High Court makes interim bail absolute in alleged fraud and GST fraud case. *  Non-manufacturer contractor liable to deposit excess excise duty collected from buyer: CESTAT. *  GST order can’t reject taxpayer’s reply as “not satisfactory” without reasons: Madhya Pradesh High Court. *  Uncorroborated statements can’t establish alleged diversion of duty-free goods: CESTAT. *  Erection services were not liable to service tax prior to 10th september 2004: CESTAT. *  Sec. 74 GST notice must spell out statutory ingredients for invoking extended tax demand proceedings: Allahabad High Court. *  No jurisdictional bar under section 6(2)(b) in parallel CGST SGST proceedings: Delhi High Court refuses to bypass GST appeal remedy. *  Madras High Court remits GST demand for fresh adjudication after taxpayer claims it was unaware of SCN following business closure.  

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PJ/Case Laws/2012-13/1225

Whether genuine importer can be penalised for inferior goods supplied by supplier of goods?
Case:- Veena Mishra V/s Commissioner of Cus. (CSI Airport), Mumbai
 
Citation:-2012 (282) E. L. T. 431 (Tri. - Mumbai)
 
Issue:- Whether genuine importer can be penalised for inferior goods supplied by supplier of goods?
 
Brief Facts:- The main im­porter M/s Tangerine Informatique Pvt. Ltd. had imported certain consignments of ICs and filed bill of entry and de­clared description of goods as mentioned in the invoice raised by the foreign supplier. As the main appellant was a private bonded warehouse, the goods were transferred to warehouse. On examination of the goods, it was found that the some of the ICs are obsolete and some are dummies. Therefore, a case has been made out against the main importer as well as against the applicants. A show-cause notice was issued. The matter was adjudicated and the im­ported goods were absolutely confiscated and the penalty on the applicant under Section 112(a) of the Customs Act has been imposed.
Appellant’s Contention: - The Id. Counsel for the applicant submits that in this case it is an admitted fact that the importer had declared the goods as per the invoice raised by the foreign supplier and on examination it was found that the goods were not as per the description in the invoice/bill of entry. In that context, they made an inquiry with the foreign supplier and alleged that the foreign supplier has cheated them by not supplying the goods as required by them. He further submits that their foreign supplier by letter dated 18-6-1997 had agreed that he has supplied some other goods to the importer therefore, re­quested the importer to send back the goods and they were ready to compensate for the difficulties faced by the importer. Therefore, he prayed that the charge of mis-declaration is not sustainable. He further submits that there was another charge of siphoning of money to foreign country by Shri Om Hemrajani (the ap­plicant). On this charge, the proceedings under FERA also took place wherein the applicant was exonerated; therefore, penalties on both the applicants are not im­posable.
Respondent’s Contention: - Respondent submits that although the proceedings un­der FERA has been dropped against the applicant but admittedly they have mis­declared the goods as the same were not found as declared at the time of inspec­tion. He further submits that the applicant has not produced the purchase order or any other documents to conclude that they have declared the goods correctly at the time of importation of the goods. Therefore, the adjudicating authority has rightly imposed the penalty under Section 112 on both the applicants.
Reasoning of Judgement: - As the charges of siphoning of money to foreign country was dropped by the FERA against the applicants, therefore, the charge of siphoning of money is not sustainable. With regard to the mis-declaration, Tribunal found that at the time of import of goods, the importer has declared the goods as per the invoice in the bill of entry and the goods were cleared. Later on, on examination the goods were found as obsolete and dummy I.C. as per the test report of the ITT. Thereafter, the applicants preceded the matter with foreign supplier, who admitted the fault that the some other goods had been supplied wrongly to the importer. Therefore, prima facie, the charge of misdeclaration of goods is also not sustainable against the applicants.
 
Accordingly, the applicants have made out a case for 100% waiver of pre-deposit of penalty. Therefore, Tribunal waive the requirement of pre-deposit of penalty and recovery thereof stayed during the pendency of the appeal.
 
Decision: - Stay granted.
 
Comment:- This is very good decision wherein the geneuine importer has not made guilty for the improper goods supplied by the supplier. This decision will come as a great relief for the importers who on one side are cheated by supplier by supplying substandard goods and on other side the department books a case against them for misdeclaration of goods.

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