Fraudulent duty-evasion scheme involving advance licence imports sustained customs penalties for active facilitation and diversion of goods.

Participation in a fraudulent duty-evasion scheme involving advance licence imports and diversion of goods attracted customs liability and penalties. The record showed routing through a front importer, manipulation of documents, non-use of the goods in the claimed manufacturing process, and diversion to local buyers. These facts supported the conclusion that the parties were not innocent purchasers but active facilitators and beneficiaries of the scheme, with coordinated transport, payment, and paper transactions confirming the Revenue's case. On that basis, the penalties were sustained.

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Issues: Whether the appellants were liable to be visited with customs consequences and penalties for their participation in a fraudulent duty-evasion scheme involving advance licence imports and diversion of goods.

Analysis: The material on record showed that the imports were routed through a front importer, that the goods were not used in the claimed manufacturing process, that documents were manipulated, and that the goods were diverted to the local buyers. The finding was that the appellants were not innocent purchasers but active facilitators and beneficiaries of the scheme, with coordinated transport, payment, and paper transactions supporting the Revenue's case. In such circumstances, the fraudulent arrangement could not be ignored and the plea for relief had no merit.

Conclusion: The appellants were held liable for their participation in the fraud and the penalties were sustained.

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