2022 (4) TMI 375

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....ndomass Trades N Trans Pvt. Ltd., there was undervaluation and since the appellant had purchased the goods imported by M/s. Indomass Trades N Trans Pvt. Ltd., the appellant is a beneficiary out of the offence of undervaluation. Accordingly, penalty under Section 112 of Customs Act, 1962 was imposed. 2. Shri A.K. Jayaraj, learned counsel appearing on behalf of the appellant submits that the appellant has no role either in the import of the subject goods or in the valuation of the goods. Appellant is merely a buyer of the imported goods; therefore, no penalty can be imposed under Section 112 of the Customs Act. He further submitted that entire allegation against the appellant was made on the basis of some statements of Shri K.V. Venugopal ....

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....d on the basis of statements of various persons and therefore the involvement of the appellant is clearly established; hence, the penalty under Section 112 was correctly imposed. 4.1. We have carefully considered the submissions made by both sides and perused the records. We find that there is no dispute that there is no admission by the appellant as regards the allegation made in the show-cause notice. This has been admitted by the adjudicating authority in para 52 of the impugned order, which is reproduced below:- 52. I find that Shri Rajesh Jain has not made any implicatory admissions in his statement. However, the statements of Shri K.V. Venugopal, M/s.Excel India Pvt. Ltd. and Shri R. Jayachandran, M/s. Cafco Freight System....

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.... 5. We find that the adjudicating authority has even not referred the request of the appellant for cross examination of the witnesses in his order. In the facts of the present case, the appellant has not given any inculpatory statement and not admitted the allegation made against him. For imposition of penalty against the appellant, the sole reliance was made on the statements of 3rd parties. In such a situation, it is incumbent on the adjudicating to allow the cross examination of the witnesses as mandated under Section 135 of Customs Act, 1962. We find that the adjudicating authority surprisingly neither allowed the cross examination nor even whisper in the impugned order to reject the request for cross examination made by the appellant. ....