ORDER
T.K. Jayaraman, Member (T)
1. This is an appeal against Order-in-Original No. 8/99 dated 29-4-1999 passed by the Commissioner of Customs, Trichy.
2. The appellants imported iron and steel scrap through Tuticorin Port. The quantity imported is declared in the Bill of Entry. After clearance the container along with the goods is weighed before delivery in the premises of the mills. There is always a difference between the declared weight of scrap in the Bill of Entry and the actual weight taken at the time of delivery in the mills. Some times, there is an excess and at the other times there is shortage. Revenue proceeded against the appellants alleging suppression of facts with an intent to evade payment of duty. The shortage and excess are based on the weighment slips. Weighment slips are also used for settling the lorry charges. Keeping in view that the difference in weight may be due to difference in weighing scale, the adjudicating authority gave an allowance of 2% in the case of excess quantity and demanded duty on the balance quantity. As far as shortage is concerned, the ad1 judicating authority gave a finding that there is no proof that the shortage is due to diversion of the imported material. On this ground, no action was taken on the shortage. In the result, the adjudicating authority confirmed the duty of Rs. 1,02,128.20 being the duty on the excess quantity under Section 28(1) of the Customs Act 1962. He imposed equal amount of penalty under Section 114A of the Customs Act. The appellants have strongly challenged the findings of the adjudicating authority.
3. Shri S. Murugappan, Id. Counsel appeared for the appellants and Smt. R. Bhagya Devi, Id. SDR for the Revenue.
4. Ld. Counsel strongly argued that the difference in weight is not on account of any clandestine activity as can be seen from the finding of the adjudicating authority in respect of the shortage. He said that there is no justification in demanding excess duty as the excess is only on account of various factors like difference in the weighing scale etc. According to him the appellants received only the quantity declared in the Bill of Entry. In certain cases excess or shortage would be only few kilograms which is very insignificant. Hence, he requested to take lenient view in the matter and set aside the order in original.
5. We have gone through the records of the case carefully. Over a period of time the Revenue has compared the quantity declared in the Bill of Entry with the weighment slip quantity and found excess quantity imported. The appellants have paid customs duty on the declared quantity. Adjudicating authority has actually given 2% allowance. Only on the quantity in excess of 2% duty has been demanded. In our view when the importer receives the goods in excess of the declared quantity they are liable to pay duty on the same. Hence, the demand of duty by the Revenue authority is correct. We uphold the demand. As far as the penalty under Section 114A is concerned, there is no evidence to establish any intention on the part of the appellants to evade payment of duty. In other words, there is no mala fide or any contumacious conduct on the part of the appellants. In these circumstances, we set aside the mandatory penalty. The appeal is partially allowed in the above terms.
(Operative portion of the order was pronounced in open Court on 23-9-2005)