Page 144 - ELT_15th August 2020_Vol 373_Part 4

478 EXCISE LAW TIMES [ Vol. 373
39. The imported gold chains were not a prohibited item. The petition-
er has attempted to smuggle of the gold chains and/or acted as an accessory for
another person. However, the benefit of Customs Notification No. 31/2003-Cus.,
dated 1-3-2003 has been extended.
40. Penalty that could be imposed on the petitioner is only under Sec-
tion 112(ii) of the Customs Act, 1962. Other situations contemplated under the
aforesaid provision are not attracted. Penalty imposable under Section 112(ii) is
subject to penalty Section 114A of the Customs Act, 1962. Penalty under Section
114A of the Customs Act, 1962 is not attracted. Penalty under Section 112(ii) of
the Customs Act, 1962, can vary only between 10% of the duty sought to be
evaded or Rs. 5,000/- whichever is higher.
41. Therefore, the penalty that could be imposed under Section 112(ii)
of the Customs Act, 1962 on the petitioner could not exceed 10% of the duty or
Rs. 5,000/-, whichever is higher.
42. 10% of Rs. 39,598/- is only Rs. 3,959/-. Therefore, maximum penal-
ty that can be imposed on the petitioner could not exceed of Rs. 5,000/. I am
therefore inclined to modify the penalty to Rs. 5,000/- from Rs. 18,000/- ordered
by the 2nd respondent Commissioner of Customs (Appeals) vide Order-in-
Appeal No. C. Cus. 171 of 2012, dated 20-3-2012.
43. Accordingly, the impugned order of the 3rd respondent upholding
the penalty of Rs. 19,000/- to that extent stands modified.
44. Redemption fine under Section 125 of the Customs Act, 1962 cannot
exceed the market value of the confiscated goods, less the duty chargeable there-
on. Since customs duty sought to be evaded was only Rs. 39,598/- by the peti-
tioner and he being a first-time offender having indulged in an attempt to smug-
gle 177 grams gold chains number of 32 and considering the fact that the benefit
of Customs Notification No. 31/2003-Cus., dated 1-3-2003 has been extended to
the petitioner and there being no challenge to extension of such benefit to the
petitioner, the redemption fine of Rs. 1,55,000/- appears to be on the higher side.
45. Under these circumstances, I am constrained to reduce the redemp-
tion fine to Rs. 50,000/- from Rs. 1,55,000/- that was modified by the 2nd re-
spondent Commissioner of Customs (Appeals). Accordingly, the impugned or-
der is further modified.
46. In fine, the impugned order dated 18-1-2013 of the 3rd respondent
upholding the imposition of penalty under Section 112 and redemption fine are
modified as follows :-
(i) The penalty of Rs. 38,000/- originally imposed by the 1st respond-
ent and reduced to Rs. 19,000/- by the 2nd respondent is further re-
duced to Rs. 5,000/-.
(ii) The redemption fine of Rs. 1,92,000/- imposed by the 1st respond-
ent and reduced to Rs. 1,55,000/- by the 2nd respondent is further
reduced to Rs. 50,000/-.
(iii) The respondents are therefore directed to refund the balance
amount of Rs. 1,19,500/- [Rs. 1,74,500- 50,000 - 5,000] to the petition-
er within a period of three months from date of receipt of a copy of
this order.
47. The present Writ Petition stands disposed with the above observa-
tions. No cost. Consequently, connected Miscellaneous Petition is closed.
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