TaxTMI 
TaxTMI 
2016 (5) TMI 608
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....ty on the grounds that the proceedings against the appellants cannot continue in view of the settlement of the case by the main noticee. Revenue challenged the said decision before the Commissioner (A) who reversed the order and penalties were imposed on these appellants. Aggrieved by the imposition of penalty, they are in appeal before the Tribunal. 2. Learned Counsel for the appellant argued the matter on two issues: - (i) Once the case against main noticees is settled in Settlement Commission, he argued that, a case against all other noticees stands settled. (ii) Since there is no confiscation of goods, no penalty under Rule 26 of the Central Excise Rules can be imposed. 2.1 Learned Counsel argued that the first issue stands settled in the Larger Benchs decision in case of S.K. Colombowala Vs. Commissioner of Customs (Import), Mumbai 2007 (220) ELT 492 (Tri-Mum). He pointed out that in the said decision, the Tribunal has held as follows: - (c) The case against all co-noticees comes to an end once the order of settlement is passed in respect of the person entitled to file an application before the Settlement Commission and therefore, penalty impos....
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....Synthetics Ltd. Vs. Commissioner of Central Excise, Raigad 2014 (314) ELT 411. 2. Learned AR relies on the impugned order. He argued that the decision of the Tribunal in case of S.K. Colombowala (supra) has not considered the decision of Hon'ble Supreme Court in the case of S.P. Chengalvaraya Naidu Vs. Jagannath 1994 (1) SCC (1). For this purpose, he relied on the decision of the tribunal in case of K I International 2012 (282) E.L.T. 67 (Tri. - Chennai). He however conceded that the said decision of the Tribunal has been stayed by the Hon'ble Bombay High Court. He further argued that the provisions of KVS scheme are similar to the provisions of Settlement Commission, in so far as the finality of the proceedings is concerned. He pointed out that the Section 90(3) of the Finance Act, 1998 (No. 2) in which the KVS Scheme was introduced reads as under: - (3). Every order passed under sub-section (1), determining the sum payable under this Scheme, shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any other proceedings under the direct tax enactment or indirect tax enactment or under any other law for the ti....
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....(ii) Sanjay Vimalbhai Deora Vs. CESTAT 2014 (306) ELT 533 (Guj). (iii) Commissioner of Central Excise, Ahmedabad Vs. Navneet Agarwal 2012 (276) ELT 515 (Tri-Ahmd). 4. I have considered the rival submissions. I find that learned Counsel for the appellants has primarily relied on the decisions of S.K. Colombowala (supra). In the said decision, there was a difference of opinion between Member (Judicial) and Member (Technical) and the matter was referred to third Member. The following questions were referred to the third Member: - 13. Whether the provisions relating to Settlement of cases under the Customs Act can be considered to be identical to Kar Vivadh Samadhan Scheme justifying invocation of case laws under the Kar Vivadh Samadhan Scheme? 14. Whether M/s. Amrit Laxmi Machine Works and its Director played main role in the fraud or the others, namely, Shri Manharlal H. Vora, Mr. Ashwin Shantilal Mehta, Nippon Bearing Pvt. Ltd., Shalin Bearings Corporation are the main persons in the crime? 15. Whether treating the appellants as mere co-noticees waiver of penalty should be granted on the ground that M/s. Amrit Laxmi Machine Works and its ....
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....o not become entirely irrelevant. It is seen that Section 90(3) of the Finance Act, 1998 (No. 2) in which the KVS Scheme was introduced reads as under: - (3). Every order passed under sub-section (1), determining the sum payable under this Scheme, shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any other proceedings under the direct tax enactment or indirect tax enactment or under any other law for the time being in force. Section 127J, which is the provision in Customs Act dealing reads as follows: - Section 127J. Order of settlement to be conclusive. - Every order of settlement passed under sub-section (7) of section 127C shall be conclusive as to the matters stated therein and no matter covered by such order shall, save as otherwise provided in this Chapter, be reopened in any proceeding under this Act or under any other law for the time being in force. The provisions regarding conclusion of proceedings in the KVSS scheme are almost identical to those for Settlement. In the case of S.K. Colombowala (supra) it is seen that the decision was given relying on the decision of Honble Supreme Court....
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.... considering the law laid down in both the earlier decisions i) Yogesh Korani v. U.O.I. 2003 (159) E.L.T. 3 (Bom.) which was approved by Hon Supreme Court on 21.7.2003 ii) U.O.I. v. Onkar S. Kanwar 2002 (145) E.L.T. 266 (S.C.) The facts of the case in Modest Shipping were as follows 2.The facts relevant to the present case are that some time in February, 1989, a rig ED-HOLT imported by M/s. Jindals arrived at Bombay. The said rig was imported by M/s. Jindals pursuant to a contract awarded to them by ONGC for charter of a Jack up rig called ED-HOLT. On arrival of the rig, the petitioners, as agents of M/s. Jindals filed Import General Manifest (IGM for short) on 2nd February, 1989. In the IGM, the rig was not declared as goods and the declaration made by them was as follows :- M.V. Nand Cauveri on tow ED-HOLT for Bombay High. As a result of the above declaration, the rig was allowed to be cleared without payment of customs duty. However, on 27th June, 1989 the petitioners on instructions from M/s. Jindals amended the IGM by adding an additional entry and thereupon a Bill of Entry was filed seeking clearance of the rig. 3. On 2....
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.... penalty was levied upon the petitioners as well as M/s. Jindals under Section 112(a) and (b) of the Customs Act, 1962. It was submitted that M/s. Jindals were the main noticee under the show cause notice and the petitioners were co-noticees. It was submitted that if the penalty levied upon the principal noticee namely, M/s. Jindal is accepted under KVSS, the petitioners being co-noticees are absolved of all the liabilities fastened upon the petitioners under the common order dated 31st August, 1994. The Counsel for petitioners relied upon the judgment of the Apex Court in the case of Union of India & Ors. v. Onkar S. Kanwar & Ors. reported in [2002 (145) E.L.T. 266 (S.C.) = 258 I.T.R. 761 S.C.] and submitted that in view of the said decision which is squarely applicable to the present case, no penalty can be recovered from the petitioners. The Hon High court distinguished the facts of the case from the facts in the case of Yogesh Korani (supra) on following grounds 10. The decision of the Apex Court in the case of Onkar S. Kanwar (supra) is squarely applicable to the present case and in view of the acceptance of the declaration of M/s. Jindals, no penalty can be recove....
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....rd parties and the duty free goods imported under the said licences were required to be used in the manufacture of export items. Investigations carried out by the Customs Authorities revealed that M/s. Choice Laboratories had illegally sold glycerine and Sodium Lauryl Sulphate (SLS) imported and cleared without payment of duty under the aforesaid advance licences in the open market, to various parties. The investigation carried out by the Customs Authorities further revealed that one such advance licence obtained by M/s. Choice Laboratories was sold to the Petitioner on 25% premium and thereafter 1998 kgs of peppermint oil was cleared duty free on the basis of the aforesaid advance licence and sold to third parties. It was also noticed that the Petitioner had sold the said advance licence to M/s. Ratilal Hemraj for a premium of 35% and a consignment of 2.22 M.Ts. of Clove Bud oil was cleared duty free on the basis of the said advance licence and sold to M/s. Colgate Palmolive Ltd. During the course of investigation, statement of various persons, including the Petitioner were recorded u/s. 108 of the Customs Act, 1962 (Actfor short) and all the aforesaid goods cleared duty free were....
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....l hearing by CEGAT, M/s. Choice Laboratories produced the aforesaid certificate issued under K.V.S.S. and on the basis of the said certificate, the Tribunal by its common order dated 11th March, 2002 dismissed the appeal of M/s. Choice Laboratories as withdrawn. By the said order dated 11th March, 2002, CEGAT confirmed the liability of the customs duty on Clove Bud Oil and also redemption fine and personal penalty levied on M/s. Ratilal Hemraj. By the said order, appeal filed by the Petitioner was also dismissed by holding that the benefit of K.V.S.S. granted to M/s. Choice Laboratories will not be available to the Petitioner, as his role continued even after the role of M/s. Choice Laboratories stopped. Challenging the said order, this petition has been filed. It is seen that in the said case before Hon'ble High Court, the facts are similar to the instant case. There was main importer against whom duty was demanded. There was also three other noticees, who were involved in disposal of goods, against whom penalty was sought to be imposed. In the said case, the Hon'ble High Court held that settlement of a case under KVSS by M/s Choice Laboratory does not prevent Revenue f....
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....upon is said to be passed sub silentio in respect of that particular matter and cannot be relied as a precedent for that specific matter which is not discussed upon. Hon Supreme court has in the case of Municipal Corporation of Delhi v. Gurnam Kaur - (1989) 1 SCC observed as under: - Pronouncements of law, which are not part of the ratio decidendi are classed as obiter dicta and are not authoritative. With all respect to the learned Judge who passed the order in Jamna Das' case and to the learned Judge who agreed with him, we cannot concede that this Court is bound to follow it. It was delivered without argument, without reference to the relevant provisions of the Act conferring express power on the Municipal Corporation to direct removal of encroachments from any public place like pavement or public streets, and without any citation of authority. Accordingly, we do not propose to uphold the decision of the High Court because, it seems to us that it is wrong in principle and cannot be justified by the terms of the relevant provisions. A decision should be treated as given per incuriam when it is given in ignorance of the terms of a statute or of a rule having the force....
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.... precedent is that a matter that has once been fully argued and decided should not be allowed to be reopened. The weight accorded to dicta varies with the type of dictum. Mere casual expressions carry no weight at all. Not every passing expression of a Judge, however eminent, can be treated as an ex cathedra statement, having the weight of authority. 5. In view of the above, I am of the opinion that the decision of Hon'ble High Court in case of Yogesh Korani (supra) which has been approved by the Hon Supreme Court, is squarely applicable to the present case. The decision of larger bench in case of S.K. Colombowala (Supra) has not considered the decision of Hon'ble High Court in case of Yogesh Korani (supra) and is sub silentio. 6. The next assertion of the appellants is that no penalty can be imposed unless there is confiscation of goods. It is noticed that in the instant case there was a proposal for confiscation of goods and the matter was settled by the settlement Commission. Thus it is recognized that an offence was committed which required invocation of provisions for confiscation of goods. However, since the matter was settled there was no confiscation of goods ....