APOLLO TYRES LTD. Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) HEARD the parties. The appellant herein is a manufacturer of tyres and they exports tyres. In respect of both the appeals, the tyres were stuffed in the factory of the appellant under the supervision of excise authorities in containers under the regulations of factory stuffing and removed under ARE -1. Thereafter, the containers were duly sealed and dispatched to the port and shipping bills were presented on 15 & 16 -8 -2007 by the CHA, online, and the containers were brought to the port and as per the endorsement in port bill of the ARE -1 form by the Superintendent of Customs (Prev). It is mentioned that "certified that the consignment was shipped under my supervision under shipping bill No. 5508652, dated 16 -8 -2007 was loaded on vessel M.V. Contry Germany, which left on 17 -8 -2007". Containers were loaded under similar endorsement by the Customs Officers at port and ship sailed on 17 -8 -2007, whereas the LEO was issued on 18 -8 -2007. In this case, on the alleged violation of provisions of Sections 40 & 51, a show cause notice was issued on 11 -2 -2011 proposing to impose penalty on the exporter/appellant along with the CHA and the shipping line. By order -in -original dated 8 -5 -2012 a penalty was imposed of Rs. 1,25,000/ - and Rs. 1,50,000/ - under the provisions of Section 114(iii) of the Act on the appellant. Being aggrieved, the appellant filed an appeal before the Commissioner (Appeals), who reduced the penalty by Rs. 75,000/ - and Rs. 25,000/ - respectively. On recording the findings that the goods have been loaded and the ship which sailed before the issuing of the LEO and hence, the goods were liable to confiscation under the provisions of Section 13(g) and accordingly liable to penalty under Section 114(iii) of the Act. The goods were held liable to confiscation. Being aggrieved, the appellant is before this Tribunal.

(2.) THE ld. Counsel submits that the show cause notice have been issued almost 3 1/2 years from the date of occurrence and hence prima facie proceedings is bad and time -barred. It is further argued that there is no incentive for the exporter to do any mischief as the goods were stuffed in the factory under the Central Excise department supervision. Further the appellant had engaged the services of CHA who was responsible for the work of clearance, etc. and accordingly there is no procedural lapse on the part of appellant. The appellant cannot be held liable and subjected to penalty. He further relied upon the rulings of the Bombay High Court in the case of CC (Export) v. Kusters Calico Machinery Ltd. - : 2010(257) E.L.T. 368 (Bom.) wherein the shipping line and the exporter was charged for loading the containers on vessel which sailed on 30 -1 -2007 without LEO which was a holiday on account of Moharam. Neither the CHA nor the exporter were allowed to go to customs area on the said date and the next day also was a holiday. So they could get the LEO on the next working day, before that the ship had sailed. In the circumstances, the exporter and CHA could hardly be said to have committed breach of Section 50(1) of the Customs Act, 1962, since it was beyond their control. Reliance was also placed on Nichrome India Ltd. v. CC (Export), Nhava Shew - : 2010(251) E.L.T. 147 (Tri -Mumbai, S.B) wherein it was held that in the absence of goods being available for confiscation, redemption fine imposed was set aside but the penalty was upheld as the loading was done without LEO and without Customs supervision. Accordingly, prays for setting aside the penalty.