2015 (5) TMI 952 - AT - Customs

Tribunal Upholds Penalties for Customs Fraud, Appellant Directed to Deposit Amount

The Tribunal upheld the penalties and customs duty imposed on the appellant for fraudulent activities, directing them to deposit a specified amount within ... Waiver of pre deposit - Penalty u/s 114A - imposition of penalty jointly and severally - Held that:- Appellant has not appeared before the Adjudicating authority or before the lower appellate authority inspite of personal hearing was granted by both the authorities below. Upon a perusal of the Order-in-Original, it was found that the Adjudicating authority demanded Customs duty and also confiscated the goods and imposed penalty on the importer M/s. Narayan Impex and also imposed penalty on the appellant and others. The appellant’s prayer before the Commissioner (Appeals) is against the penalty of ₹ 52,56,555/-. Since it is clearly established the entire advance licence has been obtained fraudulently, as has been clearly brought out in the Order-in-Original at P.23, prima facie, as the role of Shri Ram Gopal Kudal has been established. - Partial stay granted. Issues: Violation of natural justice, Imposition of penalty jointly and severally, Validity of Order-in-AppealViolation of natural justice: The appellant contended that both the Adjudicating authority and the lower appellate authority had decided the case ex parte without giving adequate opportunity of being heard, which they argued violated the principles of natural justice. They claimed that the imposition of penalty jointly and severally on M/s. Narayan Impex, along with individuals, was illegal and unsustainable. The appellant further argued that the Order-in-Appeal passed without hearing them by the Commissioner (Appeals) was illegal, invalid, and unsustainable. However, the learned AR for Revenue reiterated the findings of the learned Commissioner, stating that there was evidence of fraudulent activities involving the appellant and others.Imposition of penalty jointly and severally: The appellant raised a specific issue regarding the imposition of penalty jointly and severally on M/s. Narayan Impex, Shri Ram Gopal Kudal, and Shri Shyam Bihani under Section 114A of the Customs Act, 1962. They argued that this imposition was illegal and unsustainable in law. The appellant claimed that the Adjudicating authority and the lower appellate authority had not provided them with adequate opportunity to present their case, which further compounded the issue of joint and several liability. The appellant sought relief from the penalty imposed on them collectively.Validity of Order-in-Appeal: The appellant challenged the validity of the Order-in-Appeal, alleging that it was passed without hearing them, thereby violating their right to be heard. They contended that the decision made by the Commissioner (Appeals) was illegal, invalid, and unsustainable due to the lack of opportunity given to them to present their case. The appellant sought a review of the Order-in-Appeal based on the principle of natural justice. However, the Tribunal found that the appellant had not appeared before the Adjudicating authority or the lower appellate authority, despite being granted a personal hearing by both authorities. The Tribunal noted that the Adjudicating authority had imposed penalties and demanded customs duty based on evidence of fraudulent activities. As a result, the Tribunal directed the appellant to deposit a specified amount within a set period, with the pre-deposit of the remaining dues waived until the appeal's disposal. Compliance was required to be reported by a specified date.