TaxTMI 
TaxTMI 
2002 (10) TMI 111
X X X X Extracts X X X X
X X X X Extracts X X X X
.... value addition was put at 20.32% as noted above. The other terms and conditions for grant of approval were specified and set out in the two letters, which required the petitioner to take possession of the allotted plot as also to obtain clearances from the Pollution Control Board prior to commencement of production. 3.The respondents on 27-2-1996, issued a show cause notice calling upon the petitioner to show cause within 30 days as to why action should not be taken against the petitioners by imposition of penalty under Section 4(1) of the Imports and Exports (Control) Act, 1947 read with Section 20(2) of the Foreign Trade (Development and Regulation) Act, 1992. The case of the respondents was that though the petitioner commenced production in April, 1989 and had imported raw material valued at Rs. 186.56 lacs during the period 1989-90 to 1994-95 and also imported capital goods valued at Rs. 24.56 lacs during 1989-90 to 1990-91. It exported goods only to the value of Rs. 215.55 lacs as against the required export obligation of Rs. 414.58 lacs. It was claimed that the value addition achieved was only 9.5% as against the stipulated 20.32%. The show cause notice also proceeded on ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the quantum to be exported. He submits that in the absence of this, no inference or conclusion could be reached that the petitioner had failed to fulfil the export obligation warranting imposition of penalty. He submits that the value addition required to be achieved was to be reckoned separately from the obligation of exporting the entire production. 7.The next submission of Mr. Sharma is that the show cause notice issued by the respondents was wholly vague and could not be acted upon inasmuch as it failed to mention the provision of the Imports and Exports (Control) Act, 1947, or of other statutes which are alleged to have been contravened. 8.Learned Counsel also dwelled upon the fact that it was on account of factors beyond the control of the petitioner that it was prevented from achieving the export targets. Counsel submitted that there was an accidental fire in March, 1992, which resulted in extensive damage to the factory as also in the death of two workers. This led to labour unrest resulting in closure of the unit for nearly two months at a stretch. Counsel also submitted that the petitioner's company faced stiff competition in view of the changing scenario in the in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ll not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bona fide belief that the offender is not liable to act in the manner prescribed by the statute. Those in charge of the affairs of the Company in failing to register the Company as a dealer acted in the honest and genuine belief that the Company was not a dealer. Granting that they erred, no case for imposing penalty was made out." Counsel submitted in the instant case that there was no contumacious or dishonest conduct and hence, penalty was not leviable. 10.Mr. Jaya....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to be used or utilized, for any purpose other than the purpose for which they are delivered to him; or (c) having made a declaration for the purpose of obtaining- (i) a licence or letter of authority to import any goods or materials, or (ii) any amendment of such licence or letter of authority, or (iii) allotment of any imported goods or materials, is found to have made in such declaration, any statement which is incorrect or false in material particulars; or (d) acquires, sells or otherwise parts with, or agrees to acquire, sell or otherwise part with, any imported goods or materials in contravention of the conditions of any licence or letter of authority in pursuance of which such goods or materials had been imported; or (e) acquires, sells or otherwise parts with or agrees to acquire, sell or otherwise part with, any imported goods or materials in contravention of the terms of any allotment made by any recognized ....