1. There is a penalty of Rs. 1.00 lakh on the appellants under Section 114(i) of the Customs Act. This penalty is based on a finding that certain goods exported under 10 shipping bills were liable to confiscation under Section 113 of the Act and that it was the appellant who by his commission/omission rendered the goods so liable. Ld.
Consultant for the appellants claims to have a strong prima facie case on the ground that the goods were not liable to confiscation under Section 113 of the Act. He therefore prays for waiver of pre-deposit and stay of recovery in respect of the penalty amount. I have heard ld.DR also, who opposes this application on the strength of the findings recorded in the impugned order.
2. After examining the records and the relevant provisions of law and considering the submissions, I find that the department proposed to confiscate the subject goods after its export. Section 113 is a provision of law for confiscation of goods which are attempted to be illegally exported. Apparently, this provision of law cannot be invoked to confiscate the goods already exported, nor is possible for the Customs authorities to do so. Thus it appears that the order of confiscation is bad in law. The penalty imposed on the appellants is the one related to the order of confiscation under Section 113. Where confiscation is bad in law so is the penalty. The appellants have made out a strong prima facie case and, therefore, waiver of pre-deposit and stay of recovery are allowed as prayed for.