TaxTMI 
TaxTMI 
TaxTMI 
2000 (3) TMI 731
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....anghvi, its Managing Director, Rs. 2.50 lakhs on K.D. Motta, its Manager; penalties under Section 112 of Rs. 10 lakhs each on Elektronik Lab and Mehta Earth Movers. 2. We have heard Mr. J.C. Patel, Advocate for the first three applicants, Mr. K.M. Mondal, Consultant for the fourth applicant, Mr. V.S. Nankani for the fifth applicant and the departmental representative. 3. The brief facts leading to the demand for duty and imposition of penalty are as follows. M/s. Sanghvi Reconditioners Pvt. Ltd. (Sanghvi for short) imported various consignments and claimed the benefit of Notification 211/83. This notification exempts from duty capital goods raw materials components etc. imported by a ship repairing unit registered with the Direc....
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....Elektronik Lab for the reason that it abetted in wrongfully availing of the notification of Sanghvi and on Mehta Earthmovers for the same reason but for a different fact that it was aware that the goods were imported for ship repairs and cleared by wrongfully claiming the notification. 5. The contentions on behalf of Sanghvi are these. The wrongful utilization of the notification in respect of earthmover spares in respect of Sanghvi is not denied and it is stated that the duty due on this count to the effect of Rs. 16,92,876/- has already been paid. With regard to the other demand it is contended that the notification nowhere stipulated that the import must be made by the person who carries out the repair. As long as the importation i....
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....tative points out there is no dispute that Sanghvi deliberately and wilfully misdeclared goods supplied to Mehta as ships suppliers, and to satisfy the Department about the compliance of notification, produced documents containing signature of master of ships certifying use of these goods forged by this applicant for repair on board. He says that the wordings of the notification is clear that the import, as well as the repair must be made by a ship repair unit. In this case although the importer was registered as ship repair unit, the actual repairs were carried out by Elektronik Lab which is not a ship repair unit. The benefit of the notification is not clearly availed. He denied the reasoning of the Commissioner regarding the penalty impo....
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....nd not the repair. It is not disputed that this condition has not been complied with. Prima facie therefore we are not able to find a case to the applicant, although the issue is arguable to some extent. 10. We are not able to at this stage to find any material that Elektronik Lab was aware of the fact that goods in question stand imported without payment of duty in terms of the notification by Sanghvi. Neither the notice nor the Commissioner's order indicated any awareness by Elektronik Lab of this fact. We have also noted that there was a legitimate reason for Elektronik Lab to be involved in the ship repair it being the agent for repair and maintenance of foreign supplies. We therefore waive deposit of the penalty imposed on Elektr....