TaxTMI 
TaxTMI 
2006 (11) TMI 36
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....following questions of law :- "(i)Whether the CESTAT is justified in applying ratio of the law laid down by the Bombay High Court in the case of Taparia Overseas (P) Limited v. UOI reported as 2003 (161) E.L.T. 47 (Bom.) for granting relief upon penalty, to original DEPB holder who committed fraud without distinguishing the fact that in the case of Taparia Overseas Hon'ble Bombay High Court decided the matter in respect of beneficiary of the DEPB i.e., to whom forged DEPB was transferred by the original DEPB holder? (ii)Whether the CESTAT is justified in allowing same treatment to the committee of the fraud and beneficiary of the DEPB who purchased it in bona fide manner? (iii)Whether the CESTAT is justified in absolving the Respondents ....
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....mritsar had purchased the freely transferable DEPB scrip otherwise than in a bona fide manner and utilized the same towards debit/exemption of duty and there is nothing to suggest of his having colluded with the exporter who obtained the DEPB scrips by fraudulent manner. Therefore, I do not hold them liable to penal action under Section 112 of the Customs Act, 1962" 4.However, duty was directed to be recovered and penalty was imposed on the respondent-assessee. 5.On appeal to the Tribunal accepted the plea of the assessee that since penalty was not imposed on the importer for importing goods against invalid DEPBs, no penalty could be imposed on the assessee-respondent and that the licence was valid till cancellation. 6.Learned Counsel fo....
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....(North India) Pvt. Limited v. CEGAT, New Delhi, 1998 (104) E.L.T. 8. 8.Learned Counsel for the revenue relied upon judgment of the Calcutta High Court in ICI India Limited v. Commissioner of Customs (Port), Calcutta, 2005 (184) E.L.T. 339 and judgment of this Court dated 22-12-2005 in Golden Tools International v. Joint DGFT, Ludhiana, 2006 (199) E.L.T. 213, wherein this court upheld cancellation of DEPB and levy of penalty under Section 11(2) of the Foreign Trade (Development and Regulation) Act, 1992. This court observed :- "12.We are of the view that both the petitions are bereft of any merit. The entire claim of the petitioners was based on falsehood. It is not in dispute that furnishing of bank certificate of exports and realisation ....
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....eign Trade either by them or on their behalf; the Joint Director of Foreign Trade acted on these representations and issued the DEPBs. The petitioners were fully aware that remittances had not been received, through the bankers whose certificates had been furnished. It clearly shows the fraudulent motive. Being the ultimate beneficiaries of the DEPBs, they cannot be heard to say that they are innocent. 13.There is no substance in the plea that a DEPB cannot be cancelled after it has outlived its life. Sub-section (4) of Section 9 of the Act, confers upon the Director General or the authorized officer power to suspend or cancel any licence granted under the Act. Suspension is an interim measure, pending passing of a final order, but cancell....
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....lished in the Official Gazette, make provision for the development and regulation of foreign trade by facilitating imports and increasing exports. (2) The Central Government may also, by order published in the Official Gazette, make provision for prohibiting, restricting or otherwise regulating, in all cases or in specified classes of cases and subject to such exceptions, if any, as may be made by or under the Order, the import or export of goods. (3) All goods to which any order under sub-section (2) applies shall be deemed to be goods, the import or export of which has been prohibited under Section 11 of the Customs Act, 1962 and all the provisions of that Act shall have effect accordingly." Sub-sections (1) and (2) are aimed at facili....
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....itioners on the basis of DEPBs', fraudulently obtained, is tantamount to contravention of the provisions as engrafted in Section 11 of the Act and thus, no fault can be found with the orders levying penalties under the said Section." 9.We have considered the rival submissions and perused the record. 10.The Tribunal has not recorded any finding that the respondent-assessee did not commit any fraud, as alleged. Correctness of the finding that the transferee M/s. Shiraj International Company Limited did not commit any fraud, having obtained DEPB without notice of the fraud, is not in question. Merely because penalty has not been imposed on the transferee on that ground, it is no ground to treat the respondent at par with the said transferee.....