2024 (4) TMI 1103 - AT - Customs

CHA employee penalized under sections 114(iii) and 114A for filing benami shipping bills with false declarations to claim ineligible drawback

CESTAT New Delhi upheld penalties under sections 114(iii) and 114A of the Customs Act against a CHA employee/manager for filing benami shipping bills with ... Imposition of penalties u/s 114 (iii) and 114A on employees / manager of CHA - benami shipping bills - mis-declaration of the description quantity and value of export consignments in order to avail ineligible drawback - HELD THAT:- The appellant’s submission that he was not aware that the IEC holder was only dummy and Shri Ashok Sharma was the master mind cannot be accepted considering that all documents were received by the appellant Shri Ashok Sharma himself. The appellant’s submission that it was not required to verify the existence of the IEC holder of physically verifying the premises also cannot be accepted in the factual matrix of the case. Had the case been one where the IEC holder had supplied all the documents to the appellant and the appellant filed the shipping bills in good faith, the situation would have been different. However, in this case without the knowledge of the IEC holder, the appellant filed benami shipping bills. The appellant was required verify if the exporter in whose name he was filing the shipping bills was indeed the exporter, and was issued IEC, etc. The appellant’s submission that he did not abet the commission of any offence u/s 114 (iii) of the Customs Act also cannot be accepted for the reason that the appellant had filed benami shipping bills with mis-declared quantities and values at the behest of Shri Ashok Sharma. It is the discovery of this mis-declaration which rendered the goods liable for confiscation. Therefore, the appellant was liable to penalty u/s 114 (iii) of the Customs Act. The appellant’s contention against the imposition of penalty u/s 114AA of the Customs Act also cannot be accepted for the reason that this section provides for penalty for willfully mis-declaring facts in any declaration before the customs authorities which the appellant did. Considering the value of the goods involved, we do not also find that the penalties imposed were excessive. We, therefore, find no reason to interfere with the order. Thus, the impugned orders are upheld and all the appeals are dismissed. Issues Involved:- Imposition of penalties under section 114 (iii) and 114A of the Customs Act, 1962 on the appellant.Summary:1. Facts of the Case: The Directorate of Revenue Intelligence received intelligence about mis-declaration of export consignments to avail ineligible drawback. Goods examined were found to be mis-declared in nature and values inflated. 2. Appeal C/50306 of 2021: Shipping bills mis-declared, goods found different from declaration, inflated values. Appellant filed bills at behest of another, mis-declared to fraudulently obtain excess drawback. Penalties imposed under section 114 (iii) and 114AA upheld.3. Appeal C/50198 of 2021: Similar facts as above, penalty of Rs. 15,00,000 imposed, upheld by Commissioner (Appeals).4. Appeal C/50199 of 2021: Identical facts, penalty of Rs. 5,00,000 imposed, upheld by Commissioner (Appeals).5. Legal Analysis: Appellant not represented in hearings, penalties imposed u/s 114 (iii) and 114AA challenged. Sections 114 (iii) and 114AA of the Customs Act cited for penalties exceeding value of goods and for false declarations, respectively.6. Decision Justification: Mis-declaration undisputed, appellant filed benami bills for fraudulent claims. Appellant's lack of knowledge not accepted, penalties justified. Appellant's submissions rejected, penalties not excessive. Orders upheld, appeals dismissed.7. Conclusion: Impugned orders upheld, penalties under section 114 (iii) and 114AA sustained, appeals dismissed.