Orissa High Court
Commissioner Of Customs vs Ajay Gupta on 27 October, 2025
Author: Murahari Sri Raman
Bench: Murahari Sri Raman
IN THE HIGH COURT OF ORISSA AT CUTTACK
OTAPL No.61 of 2025
Commissioner of Customs .... Appellant
(Preventive), Bhubaneswar
Mr. Sujan Kumar Roy Choudhury,
Senior Standing Counsel
-versus-
Ajay Gupta .... Respondent
Mr. Saswat Kumar Acharya, Advocate along with
Mr. Abhisek Agarwal, Advocates
CORAM:
THE HON'BLE THE CHIEF JUSTICE
AND
THE HON'BLE MR. JUSTICE MURAHARI SRI RAMAN
ORDER
Order No. 27.10.2025
01. 1. Assailing order dated 25.09.2024 passed by the Customs,
Excise and Service Tax Appellate Tribunal, (Eastern Zonal Bench),
Kolkata (for short, "the CESTAT") in Customs Appeal No.75899
of 2024 and Customs Cross Objection No.75575 of 2024
(Commissioner of Customs (Preventive), Bhubaneswar Vs. M/s.
S.M. Nirayat Pvt. Ltd.) WITH Customs Appeal No.75900 of 2024
and Customs Cross Objection No.75577 of 2024 (Commissioner of
Customs (Preventive), Bhubaneswar Vs. M/s. S.M. Niryat Pvt. Ltd.),
arising out of Order-in-Original
No.CC(P)/BBSR/CUS/No.04/Commissioner/2024, dated
18.01.2024; Customs Appeal No.75901 of 2024 and Customs Cross
Objection No.75579 of 2024 (Commissioner of Customs
(Preventive), Bhubaneswar Vs. M/s. Disha Realcon Pvt. Ltd.),
arising out of Order-in-Original No.CC(P)/BBSR/CUS/NO-
01/COMMISSIONER/2024, dated 08.01.2024; Customs Appeal
No.76102 of 2024 and Customs Cross Objection No.75607 of 2024
(Commissioner of Customs (Preventive), Bhubaneswar Vs. Shri
Ajay Gupta), arising out of Order-in-Original
No.CC(P)/BBSR/CUS/NO-01/COMMISSIONER/2024, dated
08.01.2024; Customs Appeal No.76103 of 2024 and Customs Cross
Objection No.75608 of 2024 (Commissioner of Customs
(Preventive), Bhubaneswar Vs. Shri Ajay Gupta), arising out of
Order-in-Original No.CC(P)/BBSR/CUS/NO-
04/COMMISSIONER/2024, dated 18.01.2024; Customs Appeal
No.76104 of 2024 and Customs Cross Objection No.75609 of 2024
(Commissioner of Customs (Preventive), Bhubaneswar Vs. Shri
Ajay Gupta), arising out of Order-in-Original
No.CC(P)/BBSR/CUS/NO-05/COMMISSIONER/2024, dated
24.01.2024; Customs Appeal No.76105 of 2024 and Customs Cross
Objection No.75610 of 2024 (Commissioner of Customs
(Preventive), Bhubaneswar Vs. Shri Manish Khemka), arising out of
Order-in-Original No.CC(P)/BBSR/CUS/NO-
01/COMMISSIONER/2024, dated 08.01.2024; Customs Appeal
No.76106 of 2024 and Customs Cross Objection No.75611 of 2024
(Commissioner of Customs (Preventive), Bhubaneswar Vs. Shri
Manish Khemka), arising out of Order-in-Original
No.CC(P)/BBSR/CUS/NO-04/COMMISSIONER/2024, dated
18.01.2024; Customs Appeal No.76107 of 2024 and Customs Cross
Objection No.75612 of 2024 (Commissioner of Customs
(Preventive), Bhubaneswar Vs. Shri Manish Khemka), arising out of
Order-in-Original No.CC(P)/BBSR/CUS/NO-
05/COMMISSIONER/2024, dated 24.01.2024; directed against the
order of the Commissioner of Customs (Preventive),
Commissionerate, Bhubaneswar, the instant appeal has been filed
raising the following question(s) of law:
"i) Whether on the facts and circumstance of the case,
the Ld. Tribunal is correct in law and facts in
dismissing the appeal filed by Department against
the Order-in-Original
No.CC(P)/BBSR/CUS/No.04/Commissioner/2021
dated 18.01.2024 passed by the Commissioner,
Customs (Preventive) Commissionerate,
Bhubaneswar ignoring the errors in the said
Original-in-Original dated 18.01.2024?
ii) Whether on the facts and circumstance of the case
the Ld. Tribunal is correct in holding that the net
Fe content of Iron Ore Fines for the purpose of
levy of Customs duty shall be determined on WMT
basis applying the conversion formula, when the
emergence of formula for such conversion has no
statutory basis?
iii) Whether on the facts and circumstance of the case,
the Ld. Tribunal is correct in law and facts in
setting aside the Order-in-Original dated
18.01.2024 passed by the Commissioner of
Customs (Preventive) Commissionerate,
Bhubaneswar, when data was received, from the
mobile phones, by the forensic database of Mr.
Ajay Gupta, Director of S.M. Niriyat Pvt. Ltd., it
was found that there is incidence of duty liability
when cargo was split into two parts, i.e., less than
58% and above 58% though the average FE
content of the combined Cargo is more than
58%?"
2. The learned CESTAT, upon taking into consideration of
factual merit of the matter, has held as follows:
"12. We are of the strong view that merely on the
premise of mixing of the cargo, post the issuance of
the let export order cannot justify the claim for
demand of duty on the entire lot, when there is
nothing contrary to hold Fe% being more than
the dutiable threshold, when arrived at on WMT
basis. For the reason we find no merit in the
learned adjudicating authority, imposing penalty
under Section 114AA on the respondents herein.
Moreover, there is no discussion in the order
passed by the learned Commissioner, with regard
to justification for imposition of such a penalty on
the respondents. For this reason alone, being
bereft of any basis or argument, other than stating
that the Director failed to inform the steve-doers,
Customs brokers of the fact of the export lot
comprised of distinct consignments, as per S/B
filed and the fact of provisional/final invoices of
the buyers, we see no merit in the imposition of
penalty supra. As for the employee Ajay Gupta the
crucial reason for imposition of penalty, is that he
was found to be in possession of invoices
pertaining to export of iron ore fines that were
loaded into the vessels. This is no plausible reason
and the penalty imposed is liable to be set aside, as
the said invoices could not be connected to the
impugned shipment. Having found commissioning
of no wrong we fall to appreciate the logic for
imposition of any such penalty on each of the
respondents. In view of our findings above, we see
no reason in the proposal of the Revenue to impose
penalty under Section 114A of the Customs Act on
the respondents. There is nothing on record,
intentional or otherwise, to establish the usage of
such material that has been found to be false or
incorrect in any material particular, therefore any
penalty on that account is certainly not imposable
in the matter.
13. In view of aforesaid we are not in agreement with
the adjudicating authority imposing penalty under
Section 114AA of the Customs Act on the
respondents and the same is required to be set
aside."
3. Mr. Saswat Acharya, learned Advocate appearing for the
respondent submitted that the questions of law as posed by the
appellant on the facts and in the circumstances of the case are no
more res integra by virtue of judgment dated 31.07.2025 of this
Court passed in OTAPL Nos.42 & 31 of 2025 respectively in the
case of Commissioner of Customs (Preventive), Bhubaneswar Vs.
M/s. Chamong Tee Exports Pvt. Ltd., wherein it has been held that
"Fe" content in Iron Ore Fines (IOF) is to be determined on the
basis of "Wet Metric Ton" (WMT) but not "Dry Metric Ton"
(DMT). He has placed reliance on the following paragraphs of the
said judgment:
"12. From the above quoted observations of the
coordinate bench, it is exposit that the Fe content
in IOF is to be determined on the basis of WMT
and not DMT and in view of a decision having
taken in this regard and in absence of any
materials forthcoming before us to take a different
view, the said point having settled cannot be said
to be a debatable one nor it invites any different
opinion to be arrived at. The comity of the judicial
discipline demands the uniformity in a
proposition of law and the judgment of the
coordinate Bench of a Court binds the other
coordinate Bench. The only course opens to the
later coordinate Bench, in the event of dissent to
refer the matter to the Chief Justice to constitute a
larger Bench.
13. As indicated above, we do not find any material
forthcoming to take a different view and, therefore,
the judicial discipline demands the adherence of
the judgment rendered by the coordinate Bench at
an earlier point of time. We thus do not find that
the contention of the appellant that Fe content in
IOF is to require to be determined on the basis of
DMT and not WMT is sustainable."
3.1. The learned Advocate submitted that the ratio of
judgment referred to supra is attracted to the instant case in all
fours.
4. Mr. Sujan Kumar Roy Choudhury, learned Senior
Standing Counsel appearing for the appellant conceded and
submitted that the aforesaid questions of law as sought to be
formulated in the appeal preferred by the Commissioner of Customs
have already been answered by this Court in the aforesaid cited
judgment.
5. Faced with such conceded position of law, this Court
finds no substantial questions of law in the instant appeal filed
under Section 130 of the Customs Act, 1962. Hence, the appeal is
dismissed. Interlocutory Applications, pending if any, shall also be
dismissed accordingly.
(Harish Tandon)
Chief Justice
Signed by: LAXMIKANT MOHAPATRA (M.S. Raman)
Designation: Senior Stenographer
Reason: Authentication Judge
Location: High Court of orissa, Cuttack
Date: 29-Oct-2025 11:59:17
MRS/Laxmikant
