TaxTMI 
TaxTMI 
2023 (7) TMI 548
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....007 (as applicable) read with section 14 of the Customs Act, 1962 (b) I re-determine the CIF value of 122 consignments (118 used cranes and 04 consignments of accessories) imported in the name of M/s Govindji Gopalji & Sons, and high seas buyers thereof (Details as per 'Annexure-A-1', A-2', A-3', A-4', B-1 and -B-2' to the show cause notice) as Rs. 73,90,29,923/- (Rupees Seventy Three Crores Ninety Lakhs Twenty Nine Thousand Nine Hundred Twenty Three Only) under Rule 3 / Rule 8 of the Custom Valuation Rules 1988 or Rule 3 Rule 9 of Customs Valuation Rules, 2007 read with section 14 of the Customs Act, 1962 (as applicable). (c) I order for confiscation of 122 consignments (118 used cranes and 04 consignments of accessories) imported in the name of M/s Govindji Gopalji & Sons, and high seas buyers thereof (Details as per 'Annexure-A-1', A-2', A-3', A-4', B-1 and -B-2' to the show cause notice) having the re-determined CIF of Rs. 73,90,29,923/- (Rupees Seventy Three Crores Ninety Lakhs Twenty Nine Thousand Nine Hundred Twenty Three Only) under Section 111(m) of the Customs Act, 1962. (d) However, I give the importer M/s Govindji Go....
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....") in terms of section 28 of the Customs Act, 1962, along with interest in terms of section 28AB of the Customs Act, 1962, as it existed at the material time (under section 28AA from 08.04.2011 onwards). (k) I confirm the duty demand of Rs. 17,86, 121/- for the used cranes purchased on high seas basis by M/s AKM Enterprises (details as per Table 18 of the show cause notice") in terms of section 28 of the Customs Act, 1962, along with interest in terms of section 28AB of the Customs Act, 1962, as it existed at the material time (under section 28AA from 08.04.2011 onwards). (l) I confirm the duty demand of Rs. 11,26,632/- for the used cranes purchased on high seas basis by M/s Huda C85160,85168,85914,85915/20155 Equipments (details as per Table 18 of the show cause) in terms of Section 28 of the Customs Act, 1962, along with interest in terms of section 28AB of the Customs Act, 1962, as it existed at the material time (under section 28AA from 08.04.2011 onwards). (m) I impose penalty under section 114A, equivalent to the duty amount of Rs. 8,35,01,181/- (details as per Table 18 of the show cause notice), on M/s Govindji Gopalji & Sons. If the duty and interest as demanded above....
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.... penalty of Rs. 1,75,000/- (Rupees One Lakh Seventy Five Thousand Only) under section 112(a) of the Customs Act, 1962 on Shri. Hakim Shaikh, Director of M/s Huda Equipments. (u) I impose penalty of Rs. 3,50,000/- (Rupees Three Lakhs Fifty Thousand Only) under section 112(a) of the Customs Act, 1962 on Shri. Madan Lalwani. (v) I impose a Penalty of Rs.1,00,00,000/- (Rupees One Crore Only) under Section 114AA of the Customs Act, 1962 on M/s Govindji Gopalji and Sons. (w) I impose a Penalty of Rs.1,00,00,000/- (Rupees One Crore Only) under Section 114AA of the Customs Act, 1962 on Shri. Dharmesh Vador, Managing Partner of M/s Govindji Gopalji and Sons. (x) I impose a Penalty of Rs. 50,000/- (Rupees Fifty Thousand Only) under Section 114AA of the Customs Act, 1962 on Shri. Dinesh Sharma, Proprietor of M/s Reetika Road Lines. (y) I impose a Penalty of Rs. 1,00,000/- (Rupees One Lakh Only) under Section 114AA of the Customs Act, 1962 on M/s Rangara Industries Pvt. Ltd. (z) I impose a Penalty of Rs. 1,00,000/- (Rupees One Lakh Only) under Section 114AA of the Customs Act, 1962 on C85160,85168,85914,85915/20157 Shri. Nizar Rangara, Chairman-cum-Director of M/s Rangara Industrie....
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....or of M/s Reetika Road Lines 1 26,61,721/- 35,73,000/- + 3 M/s Rangara Industries Pvt Ltd and Shri Nizar Rangara 1 1,48,92,500/- 1,16,30,654/- 9,43,508/- 4 Shri A.K. Mani, proprietor of M/s AKM Enterprises 2 1,38,25,118/- 2,00,00,000/- 17,86,121/- M/s Huda Equipments Pvt Ltd and Shri Hakim Shaikh 1 48,27,819/- 87,22,750/- 11,26,632/- Total 122 39,64,79,950/- 73,90,29,923/- 8,73,57,448/- + Differential duty of this crane being beyond 5 years period, is beyond time period under Section 28 of the Customs Act, 1962. However, differential duty having been deposited voluntarily, the same has been adjusted against duty evaded jointly and severally were called upon to show cause, as to why: (a) the respective declared value of the goods as mentioned in column 'D' of the Table 18 ibid (further details at 'Annexure-A-1' to 'Annexure-B-2' to this notice) should not be rejected under Rule 10A/ Rule 12 of the Custom Valuation Rules 1988/ 2007 (as applicable) and the value should not be re- determined as the value mentioned in column 'E' of the Table-18 ibid, under Rule 3 / Rule 8 of the Custom Valuation Rules 1988....
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.... Section 112(a) of the Customs Act, 1962 in relation to the consignments, imported and cleared from Mumbai port, mentioned against their respective names In Table 17 supra; (b) penalty should not be imposed upon them under Section 114AA of the Customs Act, 1962 in relation to the consignments, imported and cleared from Mumbai port, mentioned against their respective names In Table17 supra; 2.2 This show cause notice was adjudicated by the Commissioner by the impugned order. Aggrieved by the order appellants have filed these appeals 2.3 We are having only the appeals of Shri Dinesh Sharma (C/85160/2015) (Appellant 1), A K Mani (C/85168/2015) (Appellant 2), Dhramesh Vador (C/85194/2015) (Appellant 3) and Govindji Gopalji & Sons (C/85915/2015) (Appellant 4). We are thus deciding the issues only in respect of these four appellants. 3.1 We have heard Shri Ankit Vishnoj Advocate for Appellant 1, Shri Stebin Mathew Advocate for Appellant 4 and Ms Pooja Reddy Advocate for Appellant 3 & 4 3.2 The counsels for the Appellant 1, Appellant 3 and Appellant 4 submitted that the order has been passed in violation of the principles of natural justice without allowing them the opportunity of h....
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....On 18/03/2013, a statement of Shri Dinesh Sharma, Proprietor of the Noticee firm was recorded by DR1 officer wherein it was recorded that a cash amount of Rs. 9,11,000/- was transacted over and above the cheque payments of Rs. 26,62,000/- and actual purchase value was Rs. 35,73,000/-. 5 Vide letter 18/3/2013 through his letter the noticee made advance revenue deposits of Rs. Rs. 5,10,015/- towards the liabilities which may arise in the matter. He was assured that with this payment his matter is closed. 6. However the noticee was issued a Show Cause Notice No. DRI/MZU/B/INV- 12/ 2010-11 dated 4/4/2013 proposing rejection of declared value and proposing to hold the subject crane as liable for confiscation and proposing imposition of penalties under Section 112 (a) and 114A of the Customs Act, 1962 7. TIME BARRED MATTER: The noticee contend that SCN IS ISSUED BEYOND FIVE YEARS OF IMPORT. The SCN was issued on 4/04/2013 which is beyond the period of five years from the date of importation which was on 20/02/2007 and therefore there is no occasion to challenge the valuation or duty liabilities on the goods which were cleared finally on first check basis and unconditionally. It is ....
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....ii)lt was further prayed that: The amount deposited by the noticee as 1. by the noticee as advance revenue deposits be kindly held as available before the adjudicating authority and the appropriation ordered in Para 27.1 of the SCN be kindly held as null and void as made at SCN stage in violation of principal of natural justice. 2. The used Crawler Crane P & I-1 670WLC SR No 50380 be held as not available for confiscation. 3. The penalties proposed in the show cause notice be dropped. 27 (E) M/s Govindji Gopalji & Sons submitted their rely to the show cause notice. It was inter alia stated that: 1. They denied the allegations contained in the said show cause notice, they also denied that, there was any mis- declaration of value or any other material particulars with reference to any of the Cranes imported by us and which on the subject matter of the present show cause notice. 2. With reference to the said show cause notice they submitted that, the allegations contained in the show cause notice are based on the incorrect statements purported to have been recorded during the investigations. These statements are, as can be seen, recorded without taking into consideration....
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....nsglobal India Pvt. Ltd. and Advocate, Shri. S. K. Mathur attended the personal hearing on 10.06.2014 on behalf of M/s Friend Syndicate Clearing Pvt. Ltd, Noticee No. 13, Shri. V. R. Divakaran, Managing Director, Friend Syndicate Clearing Pvt. Ltd, Noticee No. 14, M/s Lakka Transglobal India Pvt. Ltd, Noticee No. 15 and Shri. K.B.Bhandari, Director, M/s Lakka Transglobal India Pvt. Ltd, Noticee No. 16. The advocate Shri. S. K. Mathur, submitted that: In the SCN there is no finding against M/s Friend Syndicate Clearing Pvt. Ltd. and M/s Lakka Transglobal India Pvt. Ltd. The prominent note of taking a benchmark value was suggested by Shri. Madan Lalwani. As such no case is made out against those noticees. In the absence of mens-rea and no role displayed by them. These firms should be absolved of penalty charges. Written submission dated 10.06.2014 were reiterated. (ii) Shri. Vikram Jhangiani, Partner of M/s M. Dharamdas & Co Noticee no. 9 and his advocate Shri. C. Nanda Gopal attended the personal hearing held on 10.06.2014 Advocate Shri C. Nanda Gopal, quoted from SCN itself to Show not M/s M. Dharamdas & Co. who bonafide in its working. It who only one of its employees Shr. M....
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....ing of mind between Shri. Dharmesh Vador (Managing Partner of M/s Govindji Gopalji & Sons) overseas supplier, High Seas Buyers (i.e. Shri. Dinesh Sharma, Shri. Nizar Rangara, Shri. A. K. Mani and Shri. Hakim Shaikh) and Shri. Madan Lalwani and others towards defrauding the public revenue by resorting to mis-declaration of the transaction value of the secondhand cranes. (ii) Shri. Dharmesh Vador, Managing Partner of M/s Govindji Gopalji & Sons imported 122 consignments of used cranes and accessories and cleared them from Customs on strength of manipulated invoices showing highly understated value of the cranes during the period January 2006 to September 2010. Out of these 122 consignments 05 used cranes were sold on high seas basis to other importers by Shri. Dharmesh Vador. (iii) Shri Madan Lalawani of CHA firm, M/s. M. Dharamdas & Co. admitted that he had suggested M/s Govindji Gopalji and Sons to declare the value of the old and used cranes as Rs. 40/- per kg of net weight of the crane as benchmark for hassle- free clearances. (iv) M/s. Govindji Gopalji & Sons, paid the actual freight charges to the shipping lines for the import of the used cranes and suppressed the said fa....
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....s v/s CCE, Madras [1984(18)ELT 499 (TRB)] the special bench of CEGAT, New Delhi. M/s. Govindji Gopalji & sons had voluntarily made a payment of Rs. 2,85,00,000/- during the course of investigation, as detailed at para 7 to the show cause notice. This is accordingly adjusted against the duty of Rs. 2,10,54,129/- payable on the 32 cranes (details as per Sr. No.1 to 27 of 'Annexure-A-1' and Sr No. 1 to 5 of 'Annexure-A-4' to the notice to the show cause notice which are beyond five years. Similarly, Shri. Dinesh Sharma, proprietor of M/s Reetika Roadlines (who had purchased one P & H 670 crane from Shri. Dharmesh Vador on high seas sale basis) had made voluntary payment of Rs. 5,10.015/- was accordingly adjusted against the duty of Rs. 2,85,426/- which was imported vide Bill of Entry no. 824766 dated 20.07.2007 which is beyond five years. (ii) It was contended that the allegations contained in the show cause notice based on the statements were not corroborated by any tangible or cogent evidences but on the other hand the said statements were totally contradictory to the laid down or the settled practice/procedure and instruction of the departments relating to asses....
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....ds, I find that while allowing the goods for home consumption, assessments were made on the limited data available to the appraising officer and no detailed investigations were carried out, as of then. It was only during the course of detailed investigation carried out by the investigating agency that it was revealed and established that the value of the imported goods has been suppressed by the noticee with intent to evade duty. As regard to affording opportunity for cross examination. I find that there is no contradiction in the depositions made by Shri. Dharmesh Vador or his above named accomplices. In view of the various confessional statements and other documentary evidences brought to fore by the investigating agency, I do not find any compelling reason for offering the cross examination as sought by the noticee and also rely on the following judgements in this regard:- (a) In case of Fortune Impex Vs Commissioner of Customs, Calcutta reported in 2001(138) ELT 556 (Tri-Kolkata) it was observed by the tribunal that "It is not required that in each and every case cross-examination should necessarily be allowed. There is no absolute right of cross-examination provided in the....
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....at the right of cross- examination in any quasi- judicial proceeding is a valuable right given to the noticee as these proceedings may have adverse consequences, at the same time under certain circumstances, this right of cross-examination can be taken away. Hon'ble High Court of Bombay while dealing with the similar issue in the case of Gyan Chand SantLal Jain v. UOI, reported in 2001 (136) E.L.T. 9 (Bom.) and taking into consideration the applicability of concept of principles of natural justice in that regard quoted para 76 of Halsbury's Law of England, Vol. I (4th Edition) which reads thus:- "Natural justice does not impose on administrative and domestic tribunals a duty to observe all the technical rules of evidence applicable to proceedings before courts of law. Members of tribunals may be entitled to draw on their specialized or local knowledge of the type of, issue before them in order to supplement as well as evaluate evidence to find facts by inquisitorial methods, and inspections and to obtain information from other persons: but it will generally be a denial of justice to fail to disclose to a party specific material relevant to the decision if he is thereby de....
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....ra Industries Pvt. Ltd. Noticee No. 4, Shri. Nizar Rangara, Chairman- Cum Director of M/s Rangara Industries Pvt. Ltd. Noticee No. 5, Shri. A. K. Mani, Proprietor of M/s AKM Enterprises, Noticee No. 6, M/s Huda Equipment Pvt. Ltd. Noticee No. 7 and Shri. Hakim Shaikh, Noticee No. 8 were given numerous opportunities to file their reply to the instant show cause notice and also make submissions during the course of personal hearing. However, they neither filed any reply to the show cause notice nor did they appear for personal hearing. I therefore find that the principals of natural justice had been complied with as the above mentioned noticees had been given adequate opportunities to have their say recorded in the matter. I therefore decide the matter on the basis of the facts available on records." 4.3 From the excerpts produced in respect of the Appellant 1, Appellant 3 and 4 from the above order it is evident that the none of the three appellants were heard by the Commissioner while passing the order. The entire case made out against the appellants is based on the statements recorded. Further it is observed that the impugned goods were assessed to duty by the Custom authorities ....
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....ble goods and to facilitate detection and confiscation of smuggled goods into, or out of the country. The contraventions and offences under the Act are committed in an organised manner under absolute secrecy. They are white-collar crimes upsetting the economy of the country. Detection and confiscation of the smuggled goods are aimed to check the escapement and avoidance of customs duty and to prevent perpetration thereof. In an appropriate case when the authority thought it expedient to have the contraveners prosecuted under Section 135 etc., separate procedure of filing a complaint has been provided under the Act. By necessary implication, resort to the investigation under Chapter XII of the Code stands excluded unless during the course of the same transaction, the offences punishable under the IPC, like Section 120B etc., are involved. Generally, the evidence in support of the violation of the provisions of the Act consists in the statement given or recorded under Section 108, the recovery panchnama (mediator's report) and the oral evidence of the witnesses in proof of recovery and in connection therewith. This Court, therefore, in evaluating the evidence for proof of the offence....
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.... case beyond reasonable doubt, then the accused is entitled to the benefit of doubt for acquittal. The question then is : whether the learned Single Judge of the High Court has committed any error of law in reversing the acquittal by the Magistrate. Not every fanciful reason that erupted from flight of imagination but relevant and germane requires tested. Reasons are the soul of law. Best way to discover truth is through the interplay of view points. Discussion captures the essence of controversy by its appraisal of alternatives, presentation of pros and cons and review on the touchstone of human conduct and all attending relevant circumstances. Truth and falsity are sworn enemies. Man may be prone to speak falsehood but circumstantial evidence will not. Falsity is routed from man's proclivity to faltering but when it is tested on the anvil of circumstantial evidence truth trans. On scanning the evidence and going through the reasoning of the learned Single Judge we find that the learned Judge was right in accepting the confessional statement of the appellant, Ex. P-4 to be a voluntary one and that it could form the basis for conviction. The Magistrate had dwelt upon the controvers....
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.....K.Mani inter alia stated that he had about 22 trucks / trailers and 9 cranes in his fleet lying at his yard in Chennai. On being asked to furnish details of the transactions relating to the aforesaid 4 cranes, Shri Mani stated that he had purchased the following two C85160,85168,85914,85915/201529 cranes viz. (i) Grove TM 800 crane (YOM 1981) and (ii) P&H (YOM 1978), from Shri Dharmesh Vador locally. On being asked further, Shri Mani interalia stated that he had gathered from trade that one Dharmesh Vador of M/s. Govindji Gopalji & Sons had many cranes available for sale; that he contacted Dharmesh and on a pre-decided date came to Mumbai with his mechanic; that Dharmesh called him to his (Dharmesh's) Taloja yard; that there he inspected the cranes and on approval of his mechanic was interested in two cranes viz. Grove TM 800 crane of 60 Tons (YOM 1981) and P&H 660 crane of 40 tons (YOM 1978); that the deal for those two cranes was finalized for an amount of 85 lakhs; that Dharmesh wanted a substantial part of the amount to be in cash to which he refused; that Dharmesh gave him an invoice of 50 lakhs for Grove TM 800 crane and invoice of 25 lakhs for P&H 600 crane and asked fo....
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....s.) Payment made in cash under stated value) (Rs.) 1 2 3 4 5 6 7 8(a) 9(b) 3 A K Mani (Propriet or M/s AKM Enterprises) 12.01.11 USED GROVE HYDRAULIC CRANE CRANE Y.O.M. 1986 TM-1275 WSTD/ACCS. 857954/26.08.08 (Sr No 2 Annexure B-2) 48,27,819/- 70,00,000/- 70,00,000/- - 4 A K Mani (Propriet or M/s AKM Enterprises) 12.01.11 USED KRUPP HYDRAULIC CRANE 6275-YOM 1991 W?STD ACC 857954/26.08.08 (Sr No 3 Annexure B-2) 89,97,299/- 1,30,00,000/- 1,30,00,000/- 11.5 Under letter dated 18.03.2013, Shri Dinesh Kumar Sharma, Proprietor of M/s. Reetika Roadlines made a voluntary payment of 5,10,015/- towards his customs duty liability in respect of the crane purchased by him from Shri Dharmesh Vador on high sea sale basis. The aforesaid payment has been deposited in the Government Treasury at New Custom House, Mumbai. 34. (i) During investigations, statements of various importers who had purchased cranes from Shri Dharmesh Vador on high seas basis were recorded. In their individual statements, the following High Sea Buyers had given the actual CIF value at which they had purchased the crane from Shri Dharmesh Vador. Therefore, I take the later admitted value ....
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....th Biju (maintenance-in-charge of all my cranes). We went to port to inspect the cranes. At port, I got shock of my life when I saw the Kruup 6275 crane. It was not the crane, photos of which were shown to me. Even the Grove TM1275 crane was not the same. I felt cheated. I took up the matter with Dharmesh. Initially, he was giving evasive replies. But I continued to pursue the matter with his father and other senior members of our trade. Finally, Dharmesh relented and refunded me an amount of Rs 75 lakhs from the amount of Rs 2 crores paid by me. This amount was deposited back in my UCO.bank account. Thereafter, bills of entry for clearance of these two cranes were filed on our behalf by M/s. Friends Syndicate Clearing Pvt Ltd, who was the Custom House Agent of M/s Govindji Gopalji and Sons. On your enquiry about payment of the Customs duty, I say that the duty in respect of the above two cranes was paid by me as follows: Sr.No Bill of entry no and date. Description of the crane Value (Rs) Duty paid (Rs) 1 857954/26.08.2008 Grove TM-1275 crane 48,76,097/- 13,96,476/- 2 857954/ 26.08.2008 Kruup 6275 Crane 90,87,272/- 26,02,523/- On your enquiry about the payment of c....