Import Of Refrigerant Gas In Cylinder Requires Permission From Controller Of Explosive: CESTAT Upholds Penalty On Container Corporation of India For Misdeclaration

Date:

The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has upheld the penalty on Container Corporation of India (CCI) for misdeclaration and held that import of refrigerant gas in cylinders requires permission from the controller of explosives.

The bench of Binu Tamta (Judicial Member) has observed that no evidence has been placed on record by the appellant, Container Corporation of India that when the goods arrived in their custody the container was without any seal or the seal was broken. The plea taken by the appellant that the goods were in deployment of CISF has already been dealt by the Delhi High Court to say that the appellant cannot escape such burden by shifting its responsibility upon the CISF. 

The Intelligence gathered that two Containers containing mis-declared and restricted goods belonging to M/s. Shanker Impex were lying in ICD, Tughlakabad, New Delhi since June, 2010. 

On examination/investigation by the DRI, it was revealed that two Containers bearing were lying in ICD, Tughlakabad for over three years. Bill of Entry was filed against Container No. GLDU7380644 but no “out of charge” was given. 

The appellant/assessee informed that during joint survey of the container, the same was found empty and an FIR was lodged with the jurisdictional police authorities. On examining the contents of Container it was found to contain cylinders filled with Refrigerant 22 Chlorodifluoromethane, Refrigerant 22 Monochlorodifluoromethane and SSG 22 Chlorodifluoromethane gas. 

The goods required import license for import of SSG 22 Gas classifiable under chapter heading 903 4490 of the Customs Tariff Act, 1975 is an ozone depleting substance covered under the Montréal protocol. The goods were, accordingly seized under Section 110 of the Customs Act.

Show cause notice was issued under Section 124 of the Customs Act, demanding customs duty along with interest and penalty of Rs.1,00,000 from the appellant among other persons under Section 28 and Section 45 of the Act read with the Regulations, 2009. On adjudication, the Adjudicating Authority held that the goods are liable for confiscation under Section 111 (d). 

Since the goods have been removed from CONCOR Warehouse during their custody, in terms of Section 45 of the Act read with rule 6(1)of the Regulations and therefore they are liable to pay duty along with penalty on the goods pilfered. The appeal filed by the appellant was dismissed.

The tribunal held that the goods got pilfered and the container seal found tampered when the goods were not still cleared. It was held that as per Section 45, the custodian is burdened with the responsibility of safe custody of imported goods, unless and until the goods are cleared either for home consumption or for being warehoused. No interference is called for in imposition of penalty under Section 117 of the Act as it was the responsibility of the appellant to keep the goods in safe and secure condition so long as they remain in their custody.

Read More: Issues Related To GST Registration Cancellation In Favour Of Assessee Is Covered In This Case Compilation 

Case Details

Case Title: M/s. Container Corporation of India Ltd. Versus Commissioner of Customs (Appeals)

Case No.: Customs Appeal No.51733 of 2022 (SM)

Date: 28.01.2025

Counsel For Appellant: Rahul Mishra

Counsel For Respondent: Vishwa Jeet Saharan

Mariya Paliwala
Mariya Paliwalahttps://jurishour.in/
Mariya is the Senior Editor at JurisHour. She has 5+ years of experience on covering tax litigation stories from the Supreme Court, High Courts and various tribunals including CESTAT, ITAT, NCLAT, NCLT, etc. Mariya graduated from MLSU Law College, Udaipur (Raj.) with B.A.LL.B. and also holds an LL.M. She started as a freelance tax reporter in the leading online legal news companies like LiveLaw & Taxscan.

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