Non-awareness of other contraband goods in Consignment other than Declared in the Bill of Entry is not an Excuse to avoid Penalty u/s 117 of the Customs Ac
Section 117 of the Customs Act, 1962 provides for the imposition of penalty on any person who imports any goods in contravention of the provisions of this Act or any rules or regulations made thereunder.
The CESTAT, in a recent ruling, has held that non-awareness of other contraband goods in a consignment other than the goods declared in the Bill of Entry is not an excuse to avoid penalty under Section 117 of the Customs Act.
In the case of M/s. Kanha Electronics v. Commissioner of Customs (Port), Kolkata, the appellant had imported LED Lighting Chains. On examination, the Customs authorities found that the goods were actually LED Strips, which were prohibited from import. The appellant pleaded that they were not aware that the goods were prohibited from import, but the CESTAT held that the appellant was under an obligation to exercise due diligence and ensure that the goods being imported were in compliance with all applicable laws and regulations.
The CESTAT further held that the non-declaration of the prohibited goods in the Bill of Entry was a clear violation of the provisions of the Customs Act, and the appellant could not claim ignorance as an excuse to avoid penalty.
Implications of the ruling:
This ruling has significant implications for importers, as it clarifies that they have a strict duty to ensure that all goods imported by them are in compliance with all applicable laws and regulations, even if they are not aware of the presence of any contraband goods in the consignment. Importers cannot claim ignorance as an excuse to avoid penalties under Section 117 of the Customs Act.
How to avoid penalty under Section 117 of the Customs Act:
Importers can take the following steps to avoid penalty under Section 117 of the Customs Act:
- Carefully read and understand the Customs Act and all applicable rules and regulations.
- Exercise due diligence in selecting their suppliers and ensuring that the goods being imported are in compliance with all applicable laws and regulations.
- Declare all goods accurately in the Bill of Entry.
- Cooperate with the Customs authorities and provide them with all necessary documentation.
If you are unsure about any aspect of the Customs Act or regulations, it is advisable to consult with a qualified Customs broker.
Additional information:
In addition to the above, importers should also be aware of the following:
- The Customs Act provides for a number of other penalties for contraventions of its provisions, including confiscation of goods and imprisonment.
- The Customs Department has a number of enforcement mechanisms in place to detect and prevent smuggling and other customs offenses. These mechanisms include:
- Risk assessment and profiling of importers and consignments.
- Physical examination of goods.
- Use of technology such as scanners and X-ray machines.
- Intelligence gathering and cooperation with other law enforcement agencies.
Importers should be prepared to cooperate with the Customs Department during its investigations and inspections. Failure to do so may result in further penalties.