TaxTMI 
TaxTMI 
2026 (8) TMI 247
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.... show cause notice was issued on 19.09.2008. Thereafter an addendum to the said show cause notice was issued on 23.07.2009. Thereafter Adjudication authority as per the impugned order-imposed penalty on Appellant and others. Adjudication authority also ordered confiscation of the Red Sanders which were attempted to be illegally exported. Aggrieved by said orders, M/s. Hibathullah Enterprises (Appellant no. 1) filed Appeal No. C/702/2010. Appellant Shri. Muhammed Haris, Managing Partner of M/s. Hibatullah Enterprises (Appellant no. 2) filed Appeal No. C/705/2010, Shri. Ratan Kumar, employee of M/s. Hibatullah Enterprises (Appellant no. 3) filed Appeal No. C/703/2010 and Shri. Shahir Muhammed, employee of the Appellant (Appellant no. 4) filed Appeal No. C/704/2010. Further aggrieved by the impugned order, Revenue also filed Appeal No. C/709/2010, on the ground that the impugned order is not issued in accordance with law. 3. When the appeals came up for hearing, the Learned Counsel for the Appellant submits that M/s Hibattullah Enterprises (Appellant No.1) was regularly exporting roofing tiles and Shri. V Anilkumar alias Anil Nair, co-noticee in the present proceedings approached t....
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.... 5. Learned Counsel further submits that the first Show Cause Notice dated 19.09.2008 was issued making false allegation against the Appellant only based on the retracted statements and without examination of the main accused Shri. Anil Nair and his companions. Therefore, the conclusion drawn in the show cause notice is without proper material facts and legal basis. Learned Counsel further submits that on perusal of the addendum dated 23.09.2009, it is evident that two persons involved in the conspiracy of illegal export of 'Red Sanders wood' who actually conspired, colluded/ aided or abetted or participated in the act. As per the statement of the main accused, there is no averment that neither Appellant No. 1 nor its employees had knowledge regarding the illegal export as held in the impugned order. 6. Learned Counsel submits that even as per the statement recorded from Shri. M.A Bhopana (Madhu) on 06.07.2009 relied in the addendum, it was specifically stated that the logs were stuffed illegally in the night at godown near Yadhapadavur that as per the direction of Shri. Anil Kumar @ Anil Nair when the truck was diverted to godown and all the operations were entirely do....
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....e above submissions. Further there is no evidence regarding involvement of the Appellants having actively connived in the substitution of cargo or any financial benefit from this transaction, specifically, when the roofing tiles intended for export were stuffed in the presence of Central Excise officers and such clandestine activity could not have been in the knowledge of the appellant. Learned Counsel draws our attention to the decision in the matter of M/s. Baba Rocks Vs. Cc & Ce-2019-Tiol-2203-Cestat-Hyd where in a similar case of attempt to export of 'red sanders' in the guise of black galaxy rough blocks was considered and inter alia held as follows:- "15. Thus, it appeared to revenue that red sanders were attempted to be smuggled out of India, in the guise of black galaxy rough blocks and appeared to be liable for confiscation, along with the containers. The appellant - M/s Baba Rocks had made the export of the granite blocks to Shanghai United Granite Industry Trading Company, Shanghai, China on the basis of the purchase order received through one Mr. K. Prabhakaran, who had introduced himself as representative of the foreign buyer. The appellant without cau....
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....ion. Therefore, penalty under Section 114 cannot be sustained." 10. In this regard, Learned Counsel relied on the following decisions:- i. CCE & C, Surat Vs. Suresh Synthetics 2016 (332) E.L.T. 385 (SC) ii. Hanuman Singh Lakhavat Vs. Cc, Ahmedabad - 2024 (1) Tmi 986 - Cestat Ahmedabad iii. M/S. Mahadev Granites Vs. The Commissioner of Customs - 2021-Tiol-626-Cestat-Mad iv. Nanda Incorporated Vs. Commissioner of Customs - 2018 (363) E.L.T. 673 v. Marvelous Engineers Pvt.,. Ltd Vs. Commr. of Cus (Export), Mumbai - 2014 (300) E.L.T. 275 vi. Maheshwari Rocks (I) Pvt. Ltd. Vs. Commissioner of Customs, Chennai - 2010 (262) E.L.T. 574 (Tri. - Chennai) 11. Learned Authorized Representative (AR) for the Revenue reiterated the finding in the impugned order and submits that there are admissible evidence in the show cause notice (SCN) to conclude that Mr. Mohammed Haris and Mr. Anil colluded and entered into criminal conspiracy to smuggle out the prohibited 'Red Sanders'. Learned AR also draws our attention to the statement recorded from the other Appellants and submits that from the statement, Shri. Muhammed Haris was aware o....
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....ority also ignored the omissions on the part of Customs House Agent (CHA) which aided the illegal export of Red Sanders by not imposing penalty on them and merely issuing warning to the CHA to be more careful in future. Thus, the persons involved in the illegal activity may escape appropriate punishment on account of the order passed by the adjudicating authority having serious legal infirmities. As such, the Order-in-Original passed by the Commissioner of Customs, Mangalore suffers from serious informative and factual inaccuracy. Therefore not legal and proper under the provisions of Customs Act, 1962. Thus, prayed that the matter may be remanded for Denovo Adjudication. 13. Heard both sides and perused the documents. 14. As regards the Appellants in Appeal No. C/702-705/2010, we find that there is no evidence to show that the appellants had assisted in loading of 'red sanders' or tampering the container or they were even aware that red sanders have been stuffed into the container somewhere on the way. Under these circumstances, in this case, apparently penalty has been imposed on the appellants on the ground that they has abetted in stuffing the attempted export of ....