ORDER
S.S. Sekhon, Member (T)
1. Appellants are importers of waste paper which they use as raw material in their factory to manufacture paper pulp. They filed a BE dated 22.05.02 for clearance of one such consequent in three containers and declared the imported goods as “Waste Paper Soft White Shavings”. The goods were assessed and sent for dock examination & clearance. On examination it was found that bales of declared waste paper were in front side of the container, while at the rear end the bales contained Art Paper sheet of uniform size, 12 such bals were said to conceal 109 pallets of serviceable paper (water paper was 11.324 MTs & serviceable 54.23 MTs). The goods were seized. Inquiries were made and show cause notice dated 3.12.02 was issued to
i) M/s. Suman Papers and Boards Ltd.
ii) M/s. Vivek Joshi, Import Manager
iii) Shri. Raman Balasubramanian, Chief Executive of High Seas Seller
iv) Shri. Sohel Kazani, Director of CHA No. 11/589.
2. Commissioner adjudicated the matter, finding –
i) Each container has four bales of waste paper which conceal the pallets of serviceable paper and since custom examination using a percentage basis, this was a deliberate act.
ii) BE was filed on 22.05.02, goods examined on 31.05.03 and seizer was effected only on 5.06.02, therefore there is no delay in using the notice.
iii) Since percentage of serviceable paper to waste was in ratio of 5:1, the benefit of notification and reliance on 1997(31) ELT 962, 199(55)ELT40, 1989 (43) ELT 140 was not available to the importer.
iv) Request for Mutilation of serviceable paper, was rejected, since that would amount to artificially changing the basic nature of imported goods.
v) As regards absence of test reports and they not being relied, he found natural eye examination to be sufficient to establish the serviceable nature of the goods.
vi) He found liability for penalty on all persons.
And ordered the confiscation of the entire 65.5 MTS goods under import under Section 111(m) and gave a redemption fine of Rs. 10 lakhs and levied duty at serviceable paper rate, denied the benefit of exemption to 54.230 MTs of the goods imposed penalty of Rs. 5 lakhs on the importer, Rs. 50 thousand each on the Manager, the High Seas Seller and Director of the Customs House Agent Firm. Hence these appeals.
3. After hearing both sides and considering the issue it is found –
a) the goods have been abandoned and not cleared by the importer due to delay in adjudication and in orienting of exorbitant charges in Docks. Since redemption offer is not being availed, the duty liability are not required to be paid. The appellants have made a grievance of the absence of order as regards the duty paid as on approx metal 11 MTs of admitted waste paper. For this purpose the order is required to be set aside and remitted to the Commissioner to pass an appropriate order. Since the matter is being remitted back, the penalty on the importers firm, if any is required to be re-determined in the remand proceedings alongwith the orders on the admitted waste paper duly and duty already paid.
b) the serviceability of the paper is an opinion of certain officers. There is no lest report to bring out to establish that the goods are not waste papers. The misdeclaration is in doubt.
c) As regards Shri. Vivek Joshi, appellant in C/1001/03. Though the order imposes a penalty of Rs. 50,000/- under Section 112(a) of the Customs Act 1962, on him, yet (here is no finding arrived in the order as to why he is liable for penalty and as to what were the acts which he did or omitted to do, which have rendered the goods liable to confiscate. In absence of the same, no penalty on him could be sustained.
d) As regards Shri. Raman Balasubramanian, notice No. 3, and other appellant herein the finding for imposition of penalty, under Section 112(2), on him, arc in paragraph 14 of the order which is reproduced verbatim –
“14. Involvement of Shri. Raman Balasubramanian, Notice No. 3 who is the High Sea Seller cannot be undermined by saying that the charges against him are based on assumptions and presumptions. It is established that he had placed order on the foreign supplier for waste soft white-shavings and on examination 85% of the total goods were found to be Art paper. His complicity in the whole exercise cannot be ignored because the imports of such kind is not at all possible without the involvement of the said notice No. 3”.
we are not enthused to approve the penalty on an Indentor, who in the routine course had placed orders not only for this consignment but many more such imports which have been made and sold in routine, on High Seas Sales basis. They have not found to be infringing the Custom provisions. There is nothing in the role enacted by the noticee and also lack of intelligence on his part, to arrive at any act of commission or omission by him, to have cause the misdeclaration and consequent confiscation. Penalty under Section 12(d) on him is not sustained.
e) As regards the Director of CHA, Shri Sohel Kazani, the role found by the adjudicator is at paragraph 15 of the impugned order which is reproduced below –
“15. Similarly Notice No. 4, Shri. Sohel F. Kazani, who has been associated with the filing of documents and examination of goods, cannot absolve his responsibility in respect of such kind of mis-declaration in the consignment. He is also liable for penal action, therefore”
Considering that this notice is a Director of the Custom House Agents firm engaged in cleaving the consignments of the present importer in the past. No specific role of the agency or in person beyond the scope of a crisis employment has been brought out in the findings which resulted in the contents of the container being shipped in the manner they were found on opening and examining them. He is innocent of any overt / convert act of commission or omission or and no knowledge could be ascribed or found by the Adjudicator which would call for a penalty on the CHA or their Director. Penalty order is to be set aside.
3. In view of the findings, the order is set aside in full. Appeal No. C/1000/03 allowed as Remand. All other appeals allowed.
(Pronounced in Court)
