Custom, Excise & Service Tax Tribunal
Ismail Mohd. & Sons vs Commissioner Of Customs (Gen), Mumbai on 18 January, 2012
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Appeal No. C/543 & 544/03
(Arising out Order-in-Original No. 35-2003/CAC/CC(G)-KKA/ dated 20.5.2003 passed by the Commissioner of Customs (Gen), Mumbai)
For approval and signature:
Honble Mr. Ashok Jindal, Member (Judicial)
Honble Mr. P.R. Chandrasekharan, Member (Technical)
1. Whether Press Reporters may be allowed to see No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the Yes CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy Yes
of the Order?
4. Whether Order is to be circulated to the Departmental Yes
authorities?
Ismail Mohd. & Sons
ARM Faiyaz
Appellant
Vs.
Commissioner of Customs (Gen), Mumbai
Respondent
Appearance:
Shri Anil Balani, Advocate for the appellant Shri V.K. Agarwal, Addl.Comm. (AR) for the respondent CORAM:
Honble Mr. Ashok Jindal, Member (Judicial) Honble Mr. P.R. Chandrasekharan, Member (Technical) Date of hearing : 18.01.2012 Date of decision : 18.01.2012 O R D E R No:..
Per: Mr. Ashok Jindal, Member (Judicial) The appellant namely Ismail Mohd & Sons, a CHA firm and ARM Faiyaz, the partner of the firm have filed these appeals against the impugned order imposing penalties under Customs Act, 1962.
2. By the impugned order penalties have been imposed on the appellant on the charge that they did not act as clearing house agent but facilitated imports of cordless telephone as they had a close relationship of the supplier of the goods and the goods have been found to be misdeclared in respect of description and value.
3. Shri Anil Balani, advocate for the appellant submitted that the allegation against the appellant are on the basis of the statement of Shri Sailesh Vagadia who has stated that the after arrival of the goods in India from Tabrez Electronics of Dubai, all the financial deals were carried out by the partner of the CHA. He would get toys, CHA firm themselves would sell the goods other than toys. This statement has not been corroborated by supporting document and proceedings under Regulation 22 of the CHALR, 2004 has been initiated against the appellant by the Commissioner of Customs (Gen). He also dropped the proceedings against the appellants. Therefore, the appellants are not liable for any penalty. Moreover, the Commissioner while imposing the penalty on the partner ARM Faiyaz has imposed 114A and 112 of the Customs Act, 1962 which is in contravention of the provisions of Section 114A of the Act. As under Section 114A, penalty can be imposed only against the person who is liable to pay duty and apparently in this matter, the partner ARM Faiyaz is not liable to pay duty. Therefore, penalty imposed against him is to be dropped in toto.
4. Heard the ld. counsel and perused the records.
5. On perusal of the records, we find that the case has been made out against the appellant for misdescription and undervaluation of the imported goods. There is a statement of Shri Sailesh Vagadia alleging the involvement of the appellant firm/partner in the act of misdescription and undervaluation. We find that in the proceedings under Regulation 22 of CHALR, 2004 the Commissioner of Customs (Gen) has observed that in view of the statement of Shri Atul Chatwani, Shri Sailesh Vagadia dated 11.7.2002 and 16.7.2002 the statement 09.5.2002 retracted on 13.5.02 by Shri Sailesh Vagadia is admissible. However, we do not find any corroborative evidence that the act of undervaluation and misdeclaration has been admitted at the behest of the CHA apart from confessional statement dated 09.05.02 of Shri Sailesh Vagadia.
6. During the course of argument the AR has brought our attention to some of the statements of co-noticees and from the statements of the co-noticees we find that the act of the CHA by producing the copies of bill of entry for imports were doubtful. Therefore, we find that a token penalty on the appellant firm can be imposed. Accordingly, we confirm the penalty on the appellant firm of Rs.25000/- only but these findings shall not have any bearing on the proceedings under CHALR, 2004 proceedings. Further, we find that the penalty under Section 114A/112 of the Customs Act have been imposed on Shri ARM Faiyaz which cannot be imposed on the partner as he is not liable to pay any duty. Under Section 114A of the Customs Act, penalty can be imposed only on the person who is liable to pay duty and penalty under Section 114A can be imposed, no penalty shall be imposed under Section 112 or 114 of the Customs Act. As in this case, penalty under Section 114A has been imposed on the partner which is not leviable and if penalty under Section 114A has been imposed no penalty under Section 112 can be imposed on the partner. Therefore, no penalty can be imposed on the partner Shri ARM Faiyaz in the facts of this case. Therefore penalty on Shri ARM Faiyaz is dropped. In these above terms, appeals are disposed of.
(Operative part pronounced in Court) (P.R. Chandrasekharan) (Ashok Jindal) Member (Technical) Member (Judicial) SR 4