Exporting Firms & Bank Manager Penalized for Fraudulent Activities in Duty Schemes

The Tribunal confirmed duty against exporting firms involved in fraudulent export activities to Russia under drawback and duty entitlement pass book schemes. Penalties were imposed on the exporting firms and the bank's Branch Manager for receiving remittances fraudulently. The exporting firms were directed to deposit 50% of the amount within eight weeks, with a warning of penalties and recovery stay for non-compliance. Compliance monitoring was scheduled to ensure adherence to the deposit directive.

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Issues:
Confirmation of duty against exporting firms under drawback and duty entitlement pass book schemes, imposition of penalties, fraudulent export activities, receipt of foreign currency through currency declaration form, requirement of deposit by exporting firms.

Confirmation of Duty and Penalties:
The judgment pertains to the confirmation of duty against exporting firms involved in exporting readymade garments to Russia under drawback and duty entitlement pass book schemes. The Tribunal confirmed the duty and imposed penalties on the exporting firms and the Branch Manager of the bank. The allegations included fraudulent export activities, specifically that the foreign buyers in Russia were non-existent, and the entire export was carried out fraudulently. Investigations revealed that the applicants were fraudulently receiving remittances for foreign currency through currency declaration forms from Russian tourists, with subsequent enhancement of the declared amounts during bank transactions.

Decision on Leniency and Deposit Requirement:
At the interim stage, the Tribunal determined that the exporting firms did not deserve leniency due to their involvement in fraudulent activities. The applicants were directed to deposit 50% of the amount in each case within eight weeks. Failure to comply with this directive would result in the pre-deposit of the balance amount and penalties being imposed, with a stay on recovery until the appeals were disposed of. The Tribunal noted that the exporting firms did not plead any financial difficulty, further justifying the deposit requirement.

Compliance and Reporting:
The judgment set a deadline for compliance, scheduling a follow-up on 26.08.2013 to ensure that the exporting firms adhered to the deposit directive. The reporting compliance date was established to monitor the progress of the firms in meeting the deposit requirements as per the Tribunal's order.

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