TaxTMI 
TaxTMI 
2023 (5) TMI 1090
X X X X Extracts X X X X
X X X X Extracts X X X X
....-original dated 29.04.2016 was rejected. The appellant had preferred the appeal, being Customs Appeal No. C/52105/2019-SM, against an order-in-appeal dated 08.05.2019 passed by the Commissioner of Customs (Appeals) rejecting the appellant's appeal against an order-in-original dated 06.05.2016. 3. The appellant is essentially aggrieved by the levy of penalty under Section 112(a) of the Customs Act, 1962 (hereafter 'the Customs Act'). In terms of the orders-in-original dated 29.04.2016 and 06.05.2016, the Adjudicating Authority had imposed penalties of Rs.13,00,000/- (Rupees Thirteen Lacs) and Rs.23,00,000/- (Rupees Twenty- three Lacs Only) under Section 112(a) of the Customs Act, respectively. 4. The aforesaid orders-in-original dated 29.04.2016 and 06.05.2016 were rendered pursuant to the show cause notices dated 11.08.2014 and 16.06.2014 issued by the Additional Director, DRI, respectively. 5. The nature of allegations made in the two show cause notices mentioned above are similar and the contentions advanced on behalf of the appellant are also similar in material aspects. The grounds on which the impugned order is assailed are common and therefore the present appeals have been....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r, statements of various persons were recorded. 9. According to the officers of DRI, the evidence and material collected during the investigations established the allegation that confectionary items exported by the appellant and the Kelsen Group were cleared on the basis of false invoices reflecting values, which were lower than the real consideration paid by the importer for the said goods. 10. Show cause notices dated 16.06.2014 were issued to various noticees including SRI, constituent partners of SRI, the appellant, the Kelsen Group, and their agents in India. The show cause notice proposed that penalties under Section 112, 114A and 114AA of the Customs Act be imposed on the importers (SRI). The other noticees including the appellant were called upon to show cause why penalty under Section 112(a) not be imposed. 11. Some of the noticees (five in number) filed applications under Section 127B of the Customs Act before the Principal Bench, Customs and Central Excise Settlement Commission, New Delhi (hereafter 'Settlement Commission') for settlement of their liability. SRI settled its liability for short payment of customs duty, interest thereon and penalty on the amounts as det....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... The appellant did not prefer the said route. Accordingly, the show cause notice dated 11.08.2014 was adjudicated by the Adjudicating Authority. The allegations made in the show cause notice were found to be correct and by an order-in-original dated 29.04.2016, the Adjudicating Authority imposed a penalty of Rs.13,00,000/- (Rupees Thirteen Lacs Only) on the appellant under Section 112(a) of the Customs Act. 17. The appeal preferred by the appellant before the Commissioner of Customs (Appeals) was rejected by the order-in-appeal dated 02.05.2019 and a further appeal preferred to the learned Tribunal was also rejected by the impugned order. Reasons and conclusion 18. The findings that the appellant had participated in the conspiracy with the importers for enabling them to avoid customs duty were upheld by the Appellate Authority as well as the Tribunal. Concededly, the concurrent findings of fact cannot be disturbed in these proceedings. Further, no attempt has been made by the learned counsel to submit to the contrary. 19. The learned counsel for the appellant has confined the present appeals to assail the impugned order on three grounds. First, it is claimed that no penalty can....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed with the Indian importers by various acts of commission and accordingly penalty has been rightly imposed under Section 112(a) of the Act. 17.1 I further find that the facts before the Hon'ble Supreme Court in the ruling of Canon India Pvt. Ltd., (supra) are very different, inasmuch as there was no case of fraud and the original Bill of Entry was assessed on first check basis. Wherein in the present case there is admitted case of collusion and forgery plus concoction of documents, including presenting and filing of false and incorrect documents (invoice), to evade Customs duty by the importer and the appellant company. Further, the present proceedings are for imposition of penalty and not for demand of duty under Section 28(4). The show cause notice on this appellant is not under Section 28(4) of the Customs Act. Fraud vitiates everything. Accordingly, I uphold the impugned orders and dismiss the appeals." 22. We find no infirmity with the aforesaid decision. 23. The contention that no penalty can be levied against the appellant since other co-noticees have settled the liability before the Settlement Commission is insubstantial. The show cause notices were issued to several p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the case of Union of India v. Onkar S. Kanwar (supra) was founded on Kar Vivad Samadhan Scheme (Removal of Difficulties) Order, 1998. The said decision does not support the view that in cases where the importer approaches the Settlement Commission under Section 127B of the Customs Act and makes a true disclosure, all other persons who are complicit in evasion of tax duty would automatically acquire immunity from penalty or prosecution. It is relevant to note that in Union of India v. Onkar S. Kanwar (supra), the Supreme Court had rejected the contention that once the company entered into a settlement under the said Scheme, the Directors and Officers would also be covered under the immunity granted to the company. The relevant extract of the said decision is set out below: "12. We are unable to accept this submission. Under the Kar Vivad Samadhan Scheme there is no adjudication on the subject matter of the demand notice or show cause notice. There is a settlement of the "tax arrears". Even though the same show cause notice may call upon the Company and its Directors/Officers to show cause, there is a separate demand for "tax arrears" against the Company and a separate demand for "....