TaxTMI 
TaxTMI 
2019 (9) TMI 30
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....or appellant 11, Shri Jeetu Motwani, Advocate for appellant 19 Shri A.P. Kothari, Authorised Representative for the Respondent ORDER PER: SANJIV SRIVASTAVA The appeals as detailed in table below are directed against the order in original No 42/2012 dated 30.11.2012 of Commissioner Custom (Export) Nhava Sheva. By the impugned order Commissioner has absolutely confiscated the 25.260 Metric Tons of "Red Sanders Wood Logs" valued at Rs. 2,02,08,000/- mis-declared on the shipping bill No 9296841 dated 27.01.2011 as "Synthetic Filament Yarn other than Sewing Thread Polyester Texturized Yarn" having value of Rs. 8,94,919/- While confiscating the said goods absolutely as these goods are prohibited for exports, Commissioner has imposed penalties as indicated in the table on various person who are appellants before us. S. No Appeal No Appellant Penalty in Rs' Lakhs Section 114(i) Section 117 Total 1 C/85460/2013 Shubh Fab Tex 33 - 33 2 C/85475/2013 Albatross Shipping Ltd 20 1 21 3 C/85476/2013 Raghavan Nambiar 10 1 11 4 C/85477/2013 Krishnan Venkatesh 10 1 11 5 C/85659/2013 Yoges....
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....tion) Act, 1992 for reasons given in the foregoing paras. (ii) I order absolute confiscation of the goods, covered under shipping bill No 9214488 dated 04.01.2011, declared as 'synthetic filament yarn other than sewing thread polyester texturised yarn' of a declared FOB value of Rs. 8,95,500/- under sections 113(d) and 113(i) of the Customs Act, 1962 read with Section 3 of the Foreign Trade (Development and Regulation) Act, 1992" Since the order of absolute confiscation of 25.26 Metric Tons of 'Red Sanders Wood Logs' valued at R 2,02,08,000/- sought to be exported by mis-declaring them as 'synthetic filament yarn other than sewing thread polyester texturised yarn' of a declared FOB value of Rs. 8,95,500/- against the shipping bill No 9214488 dated 04.01.2011 is not under challenge in appeals before us, nor the actual owners/ exporters of the said goods are not before us we do not pronounce anything in respect of the said portion of order. Any finding recorded in this order may not be construed as in favour of or against the order of Commissioner contained in the said paras. 4.1 Para 29 of Show Cause Notice specifically states as follows: "29 Framing of penal....
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....ter; (ii) in the case of dutiable goods, other than prohibited goods, subject to the provisions of section 114A, to a penalty not exceeding ten per cent. of the duty sought to be evaded or five thousand rupees, whichever is higher: Provided that where such duty as determined under subsection (8) of section 28 and the interest payable thereon under section 28AA is paid within thirty days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent of the penalty so determined;] (iii) in the case of any other goods, to a penalty not exceeding the value of the goods, as declared by the exporter or the value as determined under this Act, whichever is the greater. SECTION 117. Penalties for contravention, etc., not expressly mentioned. - Any person who contravenes any provision of this Act or abets any such contravention or who fails to comply with any provision of this Act with which it was his duty to comply, where no express penalty is elsewhere provided for such contravention or failure, shall be liable to a ....
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.... the alleged knowledge about procurement of the garments. Introduction of Shri Chandragupta established, would only render such abetment & assistance in the realm of 'Preparation to Export' and not 'attempt or successful exports'. "Preparations to Export" is not covered under Section 113(d) which covers 'attempts' and or Section 113(1), which covers "goods entered for exportation under claim for drawback which do not correspond in any material particular with the entry made under the Act or....." As entry in the case of Exports would, as per Section 2(16) of Customs Act, 1962 would be 'entry' made only on the Shipping Bill filed, under Section 50 of the Act. No actions, wilful participation or knowledge thereof in this activity, after such an entry was made, under Section 50 of the Customs Act, 1962, is brought out in the order against the appellant. The penalty under Section 114 of the Custom Act, 1962 as arrived could be therefore not upheld." IDBI Bank Ltd [2011 (274) ELT 439 (T-Del)] 6. It is seen that the finding against Shri Ravinder is one of carelessness and failure to perform his duties. These might constitute facts to institute departmental proceedings against Shri ....
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....archy, they have acted as per his instructions. However, even Commissioner has not attributed any motive to these three persons and on the basis of instructions issued by Mr. D.T. Mehta they have acted. The penalty imposed on them by the Commissioner amounting to Rs. 7 lacs, Rs. 9 lacs and Rs. 12 lacs is, therefore, unjustified. The Tribunal has considered this aspect of the matter in its order and it was observed by the Tribunal that all the four applicants including Mr. Mehta and present three respondents are employed in the office of Regional Transport Officer, Nadiad. Mr. D.T. Mehta examined the case in question following the application for registration. In the application he has written against the column the year of manufacture 'not known'. The year of the manufacturing was shown in the affidavit of owner. Shri Jagdishbhai P. Parikh, Head Clerk, said in his statement that the year of manufacture was not filled in his register and registration certificate issued was because of the advice received from Mr. D.T. Mehta. Why Mr. Mehta chose to write 'not known' in the application was not satisfactorily explained nor why he could not take steps to ascertain the year of the manufac....
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.... the exporters cannot absolve themselves from their responsibilities relating to the export consignments. While I agree with the finding that an exporter cannot absolve himself from his responsibility for the export consignment, this cannot be stretched to hold that exporter is liable to penalty under Section 114 in the absence of any evidence on record to show that any acts of commission or omission on his part rendered the goods liable to confiscation under Section 113. The goods were stuffed in the container under the Central Excise supervision and the red sanders logs were substituted en route to the Chennai Port. It is intriguing to find that the seals were not tampered with and they were intact at the time of examination of the consignments. The impugned order does not contain any material to conclude that the exporter either knew that the goods were liable to confiscation or did something or omitted to do something which commission or omission tendered the goods liable to confiscation; Therefore, penalty under Section 114 cannot be sustained." M. Renganathan [2017 (345) ELT 95 (MAD)] "4. The main plea of the learned Standing Counsel appearing for the department is that....
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....in position to uphold the penalties imposed under Section 114(i) of the Customs Act,1962. 4.5 Penalties under Section 117 of Customs Act ,1962 Commissioner has imposed penalties on some of the appellants as indicated in table in para 1 under Section 117 of Customs Act,1962. From the scheme of Section 114 and Section 117, it is quite evident that penalties under Section 114 and 117 could not have been imposed simultaneously. Penalty under Section 117, could have been imposed only in cases where the Custom Act, do not prescribe for imposition of penalty under any other provision. Once we have set aside the penalties under Section 114, we proceed to examine the penalties imposed under Section 117. In fact the Commissioner in his order have observed that appellants on whom the penalties under section 117 have been imposed were negligent in some manner in fulfilling the statutory responsibilities in the manner in they should have been done. They could have been more careful in respect of their clients/ customers so that such frauds could have been prevented. In our view the penalties imposed under is necessary to deter appellants and signal to them to be more careful while conduct....
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....ner no. BLJU 4080018. The container, in the past exports, was provide to Atul Jadhav of M/s Jadhav Freight Forwarders by M/s Albatross Shipping the CAB TEX Document 2 container line, and the exporter (shipper) mentioned in the booking slip was 'Silver Exports' whereas the container was used for illegal export under shipping bill no. 9214488 dated 04.01.2011 filed in the name of M/s Shubh Fab Tex. a. I find that Container security seal no. 623007 C. EX. KALYAN, used for sealing container no. BAXU 5021903 was issued by M/s Warner Industries to Shri Sameer Gohil of M/s Central Express Cargo Moovers. However, investigations further revealed that the said M/s Central Express Cargo Moovers was a non-existent firm. I further find that the said seal appeared to denote that it was issued by Central Excise, Kalyan, the jurisdictional Central Excise Range mentioned in Invoice No. EXP/SFT/22 dated 24.01.2011 pertaining to the goods under seizure. It is clear from the above that the act of providing the said seal by M/s Warner Industries to Shri Sameer Gohil of M/s Central Express Cargo Moovers and their failure to verify the genuineness of M/s Centra....
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....nder Rule 5 also could not be determined. Since there was. expert opinion of Wild Life Inspector available, which was appropriate in this case, the value of the goods was re-determined under Rule 6 of the CVR, 2007, to be Rs. 2,02,08,000/-. d. With regard to the confiscation of the goods, I find that Red Sanders wood logs, classified under Tariff item HS Code 4403 99 18 and 4403 99 90, was prohibited for export as specified under S. No. 154 of Chapter 44 of the Schedule 2 (Export Policy) of the ITC (HS) read with para 2.1 of the Foreign Trade Policy 2009-2014 (notified by the Central Government vide notification no. 1/2009-2014 dated 27.08.2004 issued by the DGFT). Further, Export of any wood in the form of logs, classified under Tariff item HS Codes 4401 10 00; 4401 21 00 and 4401 30 00 which falls under S No. 143 of Chapter 44 of Schedule 2 (Export Policy) of the Foreign Trade Policy 2009-2014 is also prohibited for export as per the said Export Policy. Therefore, the said goods are also liable to confiscation under section 113 (d) and 113 (i) of the Customs Act, 1962 read with section 3 of the Foreign Trade (Development and Regulation....
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....ers/exporters to verify both the above aspects on daily basis and in case they fail to do so, the concerned CHA/importer/exporter will be precluded from pleading ignorance at the time of subsequent investigation, if any". I find that M/s. Shubh Fab Tcx disregarded the instructions contained in the said Facility Notice and Public Notice. This fact was admitted by Shri Biren Gala in his statement dated 9.6.2011. Had they complied with the said instructions, the said attempt to export the contraband goods would not have taken place. The said failure/omission on the part of M/s Shubh Fab Tex has allowed the actual exporters to use the said IEC held by M/s Shubh Fab Tex in their attempt to improperly export the said goods and rendered the goods liable to confiscation under sections 113 (d) and 113 (i) of the Customs. Act, 1962 and hence M/s Shubh Fab Tex are liable to penalty under section 114 ) of the Customs Act, 1962. f. With regard to the CHA M/s. O.K. Cargo Craft Pvt Ltd, the subject shipping bill no. 9296841 dated 27.01.2011 was filed under the said CHA firm. I find that Shri Jayesh Odhavaji Bhanushali, Managing Director, M/s O. K. Carg....
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.... contained in the Facility Notice and Public Notice. If they were vigilant in their actions, the said attempt of exports would have been foiled.. Their acts of omissions rendered the goods liable to confiscation. Therefore, penalty under Section 114(i) of the Customs Act, 1962 is justifiable against the CHA. g. With respect to M/s Team Global Logistics Pvt. Ltd, freight forwarders, I find that they obtained container no. BAXU 5021903 from M/s Freight Connection India Pvt. Ltd, the container owners/container and then provided to one Shri Pramod/Deepak/Atul Jadhav/ of M/s Jadhav Freight Forwarders. M/s Team Global Logistics Pvt. Ltd was the intermediary between the container line, M/s Freight Connection India Pvt. Ltd and the end recipient, Shri Pramod/Deepak/Atul Jadhav / of M/s Jadhav Freight Forwarders. I further find that M/s Team Global Logistics Pvt. Ltd booked the said container through e-mail sent to M/s Freight Connection India Pvt. Ltd, and handed over the Delivery Order for container to Shri Pramod/Deepak/Atul Jadhav/ of M/s Jadhav Freight Forwarders. The above fact is supported by the statement of Shri Yogesh Ramchandra Adak, Sale....
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....ntainer for the purpose of exporting goods was the exporter or CHA or their authorized representative. The said omissions on part of M/s Team Global Logistics Pvt. Ltd resulted in use of the said container for the purpose of smuggling of subject goods. Mis Team Global Logistics Pvt. Ltd abetted Shri Pramod/Deepak/Atul Jadhav/M/s Jadhav Freight Forwarders and their associates, the actual exporters, to smuggle the subject goods for which they charged an amount of $ 355 (Rs 15,913/-) to Shri Pramod/Deepak/Atul Jadhav/M/s Jadhav Freight Forwarders for services rendered by them. The said failure/ omissions on part of M/s Team Global Logistics Pvt. Ltd; the said act of providing the containers to the actual exporters, persons who were neither the legal exporters nor the CHA and the said act of abetting the actual exporters in their attempt to improperly export the said goods has allowed Shri Pramod, Deepak, Atul Jadhav, and their associates, the actual exporters, to smuggle the subject goods and rendered the goods liable to confiscation under sections 113 (d) and 113 (i) and M/s Team Global Logistics Pvt. Ltd were liable to penalty under section ....
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....he delivery order for the said container was issued in the name of M/s Team Global Logistics Pvt. Lto, they charged an amount of Rs 11,443/- to M/s Team Global Logistics Pvt. Lid for their services. All the above facts were supported by the statement of Shri Anand Moorthy recorded on 21/22.06.2011, wherein he further admitted that their marketing and booking staff who dealt with booking and issue of the said container acted in conformity with the company policy, which was geared to augment their business. decided by Shri. Farhad Dholoo, Managing Director. M/s Freight Connection India Pvt. Ltd. It is clear from the above that M/s Freight Connection inds Pvt. Ltd were not vigilant about the probable misuse of the container and seal owned/provided by them and they failed to take precaution to preclude the misuse of the container and seal by unscrupulous persons. Shri Pramod, Deepak, As Jadhav, who (along with their associates) and the actual exporters were the end recipients of the said container and they used the said container to smuggle the subject goods. I find that M/s Freight Connection India Pvt. Ltd did not ascertain or even enquire ab....
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....of section 140 (a) of the Customs Act, 1962, both Shri Ananda Moorthy and Shri Farhad Dholoo are liable to penalty under sections 114 (i) and 117 of the Customs Act, 1962, for the aforesaid offences committed by their company, M/s Freight Connection India Pvt. Ltd. Their version in their defence reply dated 17.11.2011 is that they released the container to M/s. Team Global Logistics in good faith and they acted in a proactive manner. I find that this contention cannot be not considered to be genuine and valid. As discussed supra, they did not enquire with M/s Team Global Logistics Pvt. Ltd as to who was the exporter or the authorised CHA, or as to who would use the said container and seal for exporting the goods. The said omission on part of M/s Freight Connection India Pvt. Ltd resulted in use, For SHUBH FAB TEX said container for the purpose of smuggling of subject goods. Document 9 k. With regard to M/s. Warner Industries, I find that they issued container security seal no. 623007 C. EX. KALYAN, used for sealing container no. BAXU 5021903 which was stuffed with Red Sanders wood logs, to Shri Sameer Gohil of M/s Central Express Ca....
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....eclared FOB value of Rs 8,95,500/- and already exported and delivered to the consignee (past export) were actually contraband/prohibited goods. I find that in this case also, the Export Invoice no. EXP/SFT/21 dated 01.01.2011 was fake and forged. The goods were shown to be stuffed in the container at factory of M/s. S.R. Fabric, but investigations revealed that this factory was non-existent. The de jure exporter, M/s Shubh Fab Tex denied filing the said shipping bill or having anything to do with tho sald goods. ShBAN Proprietor M/s Shubh Fab Tex stated that signature and the rubber stampen the DU CAR TEX Document 10 invoice did not belong to him and his firm did not have any factory stuffing permission and he did not know any firm by the name of S. R, Fabrics or M/s O. K. Cargo Craft Pvt. Ltd. The CHA, M/s O. K. Cargo Craft Pvt. Ltd denied filing the said shipping bill. The actual exporters/owners of the goods disappeared from the scene as soon as investigation started. I further find that so far, the exact nature of the goods could not be confirmed in absence of the goods and the fact that the actual exporters/owners of the goods were n....
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....r CHA licence by unscrupulous persons. which allowed the actual exporters to use their CHA licence no. to the said shipping bill. The said failure/omission on part of M/s O. K, Cargo Craft Pvt. Ltd has allowed the actual exporters to use the said CHA licence held by M/s O, K. Cargo Craft Pv 1 CAR TEX Document 11 Ltd in their attempt to improperly export the subject goods and rendered the goods liable to confiscation under sections 113 (d) and 113 (i) and M/s O. K. Cargo Craft Pvt. Ltd and they are liable to penalty under section 114 (1) of the Customs Act, 1962. C. With regard to M/s. Albatross Shipping Ltd, they provided container no. BLJU 4080018 and agent seal to Shri Atul Jadhav of M/s Jadhav Freight Forwarders. As per the statement dated 28.06.2011 of Shri Pramod Pathare of M/s Albatross Shipping Ltd, they booked the said container no. BLJU 4080018 in the name of M/s Silver Exports on the basis of e-mail received from Shri Atul Jadhav of Jadhav Freight Forwarders. Delivery Order for the said container was also issued by them in the name of M/s Silver Exports. They did not have any document to indicate that Shri Atul Jadhav/Jadh....
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....xporters in order to gain quick business. The said failure/ omission on part of M/s Albatross Shipping Ltd; the said act of providing the container to Shri Atul Jadhav M/s Jadhav Freight Forwarders, who were neither the legal exporters nor the CHA and the said act of abetting the actual exporters in their attempt to improperly export the said goods has rendered the goods liable to confiscation under section 113 (d) and 113 (1) and M/s Albatross Shipping Ltd were liable to penalty under section 114 (1) of the Customs Act, 1962. Further, M/s Albatross Shipping Ltd by abetting Shri Atul Jadhav/ M/s Jadhav Freight Forwarders, who were neither the legal exporter nor the CHA, in contravening the provisions of 146 (1) of the Customs Act, 1962 and Regulation no. 3 (a) of the Customs House Agents Licensing Regulations, 2004 have, in addition, rendered themselves liable to penalty under section 117 of the Customs Act, 1962. d. With regard to Shri Krishnan Venkatesh and Shri Raghavan Nambiar, I find that Shri Krishnan Venkatesh in his statement dated 04.07.2011 admitted that the subject shipment was done under his instruction, and he as well as oth....
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....an Nambiar and Shri K. Venkatesh and hence they have got involved in the operations and transactions. Therefore, penalty on them is imposable. e. With regard to M/s. Relay Shipping Agency, i find that they were the snipping agent and vessel agent and authorised representative of the master of the vessel which shipped the containers no. BLJU 4080018 out of India. They did not receive any copy of shipping bill passed by the customs officer from the exporter or the CHA. They relied on M/s Albatross Shipping Ltd, the 'container line to verify details of exporter, CHA and that the shipping bill was passed by the customs and Let Export order given in respect of the above shipment. It is clear from the above that though the subject shipping bill was duly passed by the proper officer, the same was not handed over to M/s Relay Shipping Agency Ltd by the exporter or the authorised agent. The reliance of the Shipping Agent, in turn on the Container Provider to verify bona fides of the exporter/CHA is in contravention to provisions of per section 40 (a) of the Customs Act, 1962. The failure/omission on part of M/s Relay Shipping Agency Ltd not to recei....