2026 (5) TMI 1178

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....on the appellant under section 112(b) of the Customs Act, 1962 [the Customs Act] 2. The appellant is an incorporated company engaged in the manufacture of M.S. Bars and Rods. At the relevant time, the appellant was registered with the Central Excise Department, Division Pithampur. Subsequently, the appellant merged with M/s. Jaideep Ispat & Alloys Pvt. Ltd. 3. An investigation was initiated by the Directorate General of Central Excise Intelligence [DGCEI] Regional Unit, Indore against M/s. New Tech Abrasives Ltd., SEZ, Pithampur [NTAL] alleging clandestine removal of M.S. Ingots from the Special Economic Zone [SEZ] without permission of the Customs authorities and without payment of customs duty. 4. Pursuant to the said information....

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....he allegations were based solely on conjectures and third-party statements. 8. The Commissioner, however, by the impugned order dated 31.07.2019, imposed a penalty of Rs. 10,00,000/- on the appellant under section 112(b) of the Customs Act. 9. Ms. Surbhi Sinha, learned counsel for the appellant made the following submissions: (i) The entire case against the appellant is based solely on vague and general statements of three transporters made under section 108 of the Customs Act, wherein the name of the appellant is casually mentioned along with several other entities. These statements are identical in nature, appear to be dictated, and wholly uncorroborated. These statements cannot also be relied upon as the procedure contempl....

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.... the appellants and the learned special counsel appearing for the department have been considered. 12. The issue that arises for consideration is whether the statements made by the three transporters under section 108 of the Customs Act could be considered as relevant because it is on the basis of these statements that it has been alleged that the appellant had purchased M.S. Ingots removed by NTAL in a clandestine manner. 13. Neither the show cause notice nor the impugned order mention that the procedure contemplated under section 138B of the Customs Act was followed. The statements made under section 108 of the Customs Act can be considered as relevant only if the procedure contemplated under section 138B of the Customs Act had been....