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2025 (11) TMI 1572
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....are that a Mercedes Benz CLS 320 CDI car was imported on 05.07.2008 by Mr. Mukesh Kumar (importeron-record) through New Customs House, New Delhi, declaring its value at Rs. 20,47,300/-. The Commissioner of Customs (Imports), vide Order-in-Original dated 31.07.2008, rejected the declared value, re-assessed it at 28,83,435/-, ordered confiscation under Section 111(d) with an option to redeem on payment of fine of Rs.6,00,000/-, and imposed penalty of Rs.4,00,000/-under Section 112(a). The Department filed an appeal wherein the Tribunal, vide Final Order No. 58624-58625/2013 dated 28.11.2013, remanded the matter to the original adjudicating authority for de-novo consideration. Meanwhile, the car was registered in India in the name of Mr. Mukesh Kumar on 01.09.2008. Shortly thereafter, in September 2008, the appellant Mr. Saket Dalmia purchased the car through M/s Watermark Systems (India) Pvt. Ltd. for 54,00,000/-, partly financed by a bank loan. In 2011, the Directorate of Revenue Intelligence [DRI] commenced investigations into mis-declaration of imported luxury cars. Statements of several persons, including the appellant, were recorded. On 02.07.2013, the car was seized by DRI and ....
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.... it. Therefore, the confirmation of penalty was liable to be set aside. In support of his submissions, learned counsel relied upon the decision of the Supreme Court in the case of CCE, Bangalore vs. Brindavan Beverages (P) Ltd. [2007 (213) ELT 487 (SC)], wherein the Supreme Court held that the show cause notice is the foundation on which the department has to build up its case. It was held that if the allegations in the show cause notice are not specific and on the contrary are vague, lack details and/or unintelligible, it is sufficient to hold that the noticees were not given proper opportunity to meet the allegations indicated in the show cause notice. The learned counsel contended that on account of the fact that neither the show cause notice nor the impugned order had specifically defined the role played by the appellant in the alleged suppression/ mis-declaration of the impugned car at the time of import, no penalty can be imposed. 6.2 Learned counsel further submitted that despite absence of evidence of any misdoing, the Commissioner has passed the impugned order based only on the statement of Mr. Sumit Walia. He submitted that the statement was not substantiated with any ....
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....llowed by the Apex Court under the Customs law in the case of Akbar Badruddin Jiwani vs. Collector of Customs [1990 (47) ELT 161]. Reliance was also placed on the case of HMP Engineers Ltd. vs. Collector of Customs (Prev.), Calcutta [2000 (123) ELT 869], it was held that merely because the assessee did not see the import documents does not render it liable for penalty, especially when there is no concrete evidence against it and also because the car had been purchased after import and registered with the transport authority in accordance with the Motor Vehicles Act. 6.4 Learned counsel further submitted that the presence of men's rea was an essential pre-requisite for establishing abetment and for imposition of penalty under section 112 (a). In this regard, he relied upon the decision of the Tribunal in the case of Harbhajan Kaur vs. Collector of Customs [1991 (56) ELT 273 (Tri-Del.)] and in the case of V. Lakshmipathy vs. Commissioner of Customs [2003 (153) ELT 640 (Tri.-Bang.) 2003 (153) ELT 640 (Tri.-Bang.)] . Learned counsel submitted that the impugned order had imposed penalty on the appellant No. 2 under section 114AA of the Customs Act, and stated that this section is inv....
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....ion or involvement with goods liable to confiscation is sufficient. Even a subsequent purchaser of smuggled or mis-declared goods can be penalized if circumstances indicate knowledge or reasonable belief of illegality. Therefore, the appellants plea of "bona fide purchaser" was not tenable. Considering the high value of the vehicle, the nature of fraud, and conscious involvement of the appellant, the penalty imposed is reasonable and proportionate to the gravity of the offence. Learned authorized representative further submitted that section 114AA of the Customs Act provides that "If a person knowingly or intentionally makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document which is false or incorrect in any material particular, in the transaction of any business relating to the Customs, he shall be liable to a penalty which may extend to five times the value of the goods." This section targets false declarations or use of false documents in customs-related transactions. The adjudicating authority imposed Rs. 5,00,000/- under section 114AA on Shri Saket Dalmia appellant No. 2 wherein considering the high value of the luxury car and the del....
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....uer by resorting to mis-declaration of value and other vital factors. I note that Shri Sumit Walia in his referred statements had categorically stated that when a customer for a particular model was finalized, he communicated the same to Shri Ashwin Kalra. This suggests that Shri Sumit, Walia, with a pre-determined mind, hatched a conspiracy to defraud the exchequer where he suppressed various facts, detailed above with reference to import of the impugned car. I find it to be a case of mis-declaration by the noticee(s) so as to avail benefit of exemption notification that was not availing to them. I further note that it is on record that the goods valued at Rs. 45,75,375.75/- were placed under seizure vide panchanama dated 02.07.2013 under provisions of Section 110 of the Customs Act, 1962 and the car was handed over to Shri Neeraj Budhiraj, authorized representative of M/s Water Mark Systems (India) Pvt. Ltd., under superdiginama dated 02.07.2013. Therefore, the goods are available for confiscation thereof under section 111(m) & 111(d) of the Customs Act, 1962. I find that the Hon'ble CESTAT vide its Final Order No.C/A/58624-58625/2013-CU[DB] dated 28.11.2013 in Customs Appeal....
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....y any duty and charge that is payable in respect of such goods. The proviso to Section 125(1) also makes it obligatory on the adjudging authority to evaluate the fine which shall not exceed the market price of the goods confiscated (emphasis supplied). Therefore, there is a mandatory requirement on the adjudicating officer before permitting the redemption of goods, firstly, to assess the market value of the goods and then to levy any duty or charge payable on such goods apart from the redemption fine that he intends to levy on sub-clause (1) of that Section. 6. In the instant case, it is an admitted fact that after issuing a notice as contemplated under Section 124 of the Act, to the importer of the goods in question and adjudication proceeding under Section 125 had been conducted and the goods in question were released on payment of redemption fine, in such an event it matters little whether the adjudication was under which sub-clause of Section 111 because whichever is the sub-clause, there was an obligation on the adjudicating authority to find out the market value of the goods so imported and to collect all duty and other charges payable on the goods in question before....
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.... Water Mark Systems (India) Pvt. Ltd., New Delhi on 10.10.08. Actually, Shri Mukesh Kumar had given an indemnity bond on 01.09.2008 stating that in case of any type of dues on pending on the said vehicle, the same will be settled/ borne by him. Later on, the Form No. 29 & 30 for transfer of registration of vehicle was signed on 20.10.2008, Shri Sumit Walia had stated in his statement dated 14.05.2011 that He knew Shri Mukesh Kumar who had a taxi business near to his Reebok gym and he offered Shri Mukesh Kumar for import of cars in his name and would pay Rs. 1.0 Lakh per car for which Shri Mukesh Kumar happily agreed. He had imported six cars on the name of Shri Mukesh Kumar specifically on the request of different six persons. From the said statement and the fact that car was transferred to M/s. Water Mark Systems (India) Pvt. Ltd., New Delhi immediately after its import, it become quite clear that Sumit Walia had imported said car in the name of Shri Mukesh Kumar, for further sale to M/s. Water Mark Systems (India) Pvt. Ltd., New Delhi, In view of above findings, I do not find any merit in Noticee No. 3 & 4 of the instant show cause notice's contention that they are mere bona ....