TaxTMI 
TaxTMI 
2006 (11) TMI 498
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....ner. 4. Appeal No. C-429/06 alongwith Stay Petition has been filed by Shri Jayesh Gala against the imposition of penalty of Rs. 10 lacs under Section 114 of the Customs Act, 1962. 5. Appeal No. 430/06 alongwith Stay Petition has been filed by Shri Govind Sharma against the imposition of penalty of Rs. 10 lacs under Section 114 of the Customs Act, 1962. 6. As regards the appeal of Shri Bhagwan Sippy, it is seen from the finding portion of the Commissioner's Order that he has denied in his written submission dated 31-10-05 the allegation made against him in the Show Cause Notice. The contention is that it is incorrectly mentioned in the Show Cause Notice that he was the partner of M/s. Bharat Overseas Communicators, instead he was only an employee of the said CHA Firm, that statement of Shri A.M. Pakhre Suptd. of Customs was recorded by DRI on 31-5-2005 under Section 108 and he stated that "Yes, sample of electrodes was shown to me by Mr. Yogesh Kumar, as it being engineering product, I presumed the declared value to be correct and I relied upon the report given by Mr. Yogesh Kumar. This is conclusive proof that no facts were hidden, concealed of suppressed in....
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....ping bills did not mention any brand names, the qualities and sizes found did not tally etc. 8. Shri Mukesh Bhanushali : The ld. Counsel for this appellant submitted that Shri Mukesh Bhanushali, is assistant of Shri Jayesh Gala. Ld. Counsel further submits that the Commissioner has passed ex parte order against the appellant, despite the request for adjournment made by him. Therefore, the proceedings against Shri Mukesh Bhanushali are in clear violation of principles of natural justice and are liable to be set aside. He has also submitted that the goods are neither prohibited nor dutiable. 9. The Commissioner in his findings against Shri Mukesh Bhanushali recorded that he has failed to submit his written reply. He has also not appeared for personal hearing except that Commissioner has recorded that Shri Mukesh Bhanushali failed to rebut the allegations made against him in the show cause notice. No other findings has been recorded against him. 10. Shri Jayesh Gala : So far as Shri Jayesh Gala is concerned, ld. Counsel for the appellant inter alia submitted that there is no corroborative evidence against the appellant. No material on record to show that the ap....
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....nst the appellant has recorded that the appellant has failed to file his written submissions and also failed to appear for personal hearing and has held that he played the role in attempted export to fraud. 11. Shri Govind Sharma : Ld. Counsel appearing on behalf of the appellant inter alia submitted that the ld. Commissioner has passed ex parte order against the appellant though a request for adjournment was made. Therefore, the impugned order has been passed in gross violation of the principles of natural justice and as such impugned order is liable to set aside on this ground alone, that ld. Commissioner should have appreciated that the seized goods are neither prohibited nor dutiable, that this appellant was working with the CHA and has not rendered any goods liable for confiscation, that the statement was obtained by coercive measures, the statement was retracted on 23-4-2004 before the Hon'ble Chief Metropolitan Magistrate; Ld. Commissioner has grossly erred in relying upon the statement of this appellant that over valuation per se can't result in the availment of DEPB as export value has to be realized first for the incentive to be available; in the present cas....
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....emsp;The Commissioner in his findings has recorded that this appellant has failed to file written submissions and did not appear on the date of personal hearing, it is clear that he has failed to rebut any of the allegation levelled against him as such held him liable for penal action under Section 114 of the Customs Act 1962. 13. After hearing, perusal of the records, we find that the Commissioner has nowhere given his findings with regard to the goods being prohibited or dutiable. The appeal of Shri Yogesh Kumar, who was also a co-accused in the above proceedings and on whom a penalty of Rs. 3 lacs was imposed by the Commissioner has been allowed and the penalty set aside as per order No. A-408-409-WZB/06/CSTB dated 3-4-06 [2006 (201) E.L.T. 66 (Tribunal)] along with other appeals in paras 7 & 8 Tribunal has recorded as under :- "I/We find that the entire case rests upon the retracted statement of Shri Jayesh Gala, who has claimed to be the agent of the exporters and his statement has not stood the test of cross examination as the Commissioner has rejected the appellants request to cross examine him. We further note that the inspection report of the appellant, on the s....
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....s under :- a) Shri Bhagwan Sippy Rs. 50,000/- (b) Shri Jayesh Gala Rs. 2,00,000/- (c) Shri Govind Sharma Rs. 2,00,000/- (d) Shri Mukesh Bhanushali Rs. 50,000/- (Pronounced in open Court on.............) Sd/- (Krishna Kumar) Member (Judicial) 15. [Order per : K.K. Agarwal, Member (T)]. - I have perused the above order proposed by my learned brother Member (Judicial). I am of the view that since the matter was listed for hearing of stay application only and the orders were received for passing orders on stay application only, no final orders can be passed without putting revenue to notice who did not get the full opportunity of presenting its case on merits and matter was argued briefly for forming a prima facie view in the matter. In view of this I refrain from passing a final order and instead proposing an order under Section 129E regarding pre-deposit of penalty. 16. For better appreciation it would be necessary to briefly narrate the facts of the case. The present matter is regarding overvaluation of export when on a specific intelligence received by DRI the containers which were examined by the cus....
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.... with the RTO revealed that the addresses of the truck owners were fake and the owners were not staying in those premises. The fact of overvaluation of goods was in the knowledge of Shri Jayesh Gala who in his statement recorded on various dates admitted that Shri Govind Sharma has informed him about the overvaluation of the goods and that he has bribed Custom officers to get the necessary clearances. The mobile number of Shri Ashok Bhai of Dubai and the Angadia through whom the payment of Rs. 6 Lakhs was made were also given but the address, mobile number of Angadia was found to be fake. Shri Jayesh Gala undertook the clearance of the goods though he was not a CHA nor its employee but was working in the name of M/s Bharat Overseas Communicators and Shri Bhagwan Sippy, Chief Executive of Bharat Overseas CHA No. 11/658 allowed his licence to be used by Shri Jayesh Gala on payment of certain amount in respect of the shipping bills handled by Shri Jayesh Gala. Shri Mukesh Bhanushali was the other associate of Shri Jayesh Gala who was accompanying Shri Jayesh Gala during the custom clearance work and was in the knowledge of the fraudulent export undertaken through Shri Jayesh Gal....
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....against him was ex-parte and the statement made by him were retracted and the co-accused Shri Yogesh Kumar has already been acquitted. 19. The learned counsel for Shri Bhagwan Sippy stated that Shri Sippy was not a partner but employee of CHA and once the goods were examined and found as per the declaration by the custom officer, the CHA cannot be held guilty of the same. Blank letter head has been signed by him in order to meet in emergency situation and a proper declaration was obtained from the exporter, M/s Payal Exim with a photo copy of IE Code number. No facts were hidden and therefore no penalty can be imposed. 20. As regards Shri Mukesh Bhanushali, it was submitted that ex parte order has been passed against him and the Commissioner has simply confirmed the allegation in the show cause notice without giving any finding. 21. The learned D.R. on the other hand submits that all the notices except Shri Yogesh Kumar and at a later stage Shri Bhagwan Sippy has been avoiding a series of summons issued to them and were absconding. The statements were initially retracted but retraction was later on rebutted and they have affirmed the facts in their subsequen....
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....The statements of Shri Jayesh Gala & Shri Govind Sharma have been retracted but later on reaffirmed and such reaffirmation was informed to Chief Technical Magistrate and therefore retraction looses all significance. Reference to Shri Ashok Bhai, Pawan Bhai, Shekhar Bhai with their mobile number cannot be tutored statement. For confiscation the goods have to correspond in value and description and in case of mis-declaration, goods are liable to confiscated under Section 113(i) after the amendment. Thus there is strong prima facie evidence against Shri Govind Sharma and Shri Jayesh Gala. As regards Shri Bhagwan Sippy it appears that by allowing Shri Jayesh Gala to work on his licence without knowing the exporter himself, he has abetted in the fraudulent export and so is the case with Shri Mukesh Bhanushali who associated in clearance business of Shri Jayesh Gala. The merits of this evidence can be examined at the time of final hearing but no prima facie case has been made out for complete waiver. I therefore order Shri Jayesh Gala and Shri Govind Sharma to deposit a sum of Rs. 4 Lakhs each towards penalty and Shri Bhagwan Sippy and Shri Mukesh Bhanushali Rs. 50,000/- each within 8 we....