Custom, Excise & Service Tax Tribunal
Ashok Kumar Goyal Manager vs Noida Customs on 3 June, 2024
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
ALLAHABAD
REGIONAL BENCH - COURT NO.I
Customs Appeal No.70508 of 2017
(Arising out of Order-In-Original No.06-Pr.Commr./NOIDA-CUS/2017 dated
28.03.2017 passed by Principal Commissioner, Noida Customs)
Shri Ashok Kumar Goyal, Manager .....Appellant-I
(M/s Ramesh & Company, H.No.346,
Adarsh Nagar, Street No.3,
Mandi Gobindgarh, Punjab-147301)
VERSUS
Commissioner of Customs (Preventive), ....Respondent
(ICD Dadri, Noida-201311) APPEARANCE:
Shri Ashish Bhatt, Advocate for the Appellant Shri Santosh Kumar, Authorised Representative for the Respondent WITH Customs Appeal No.70509 of 2017 (Arising out of Order-In-Original No.06-Pr.Commr./NOIDA-CUS/2017 dated 28.03.2017 passed by Principal Commissioner, Noida Customs) Shri Vipan Kumar Garg, Proprietor .....Appellant-II (M/s Vipan & Company, 281, Sector No.5A, G.T. Road, Sirhind Side, Mandi Gobindgarh, Punjab-147301) VERSUS Commissioner of Customs (Preventive), ....Respondent (ICD Dadri, Noida-201311) APPEARANCE:
Ms Jyotika Sharma, Advocate for the Appellant Shri Santosh Kumar, Authorised Representative for the Respondent WITH Customs Appeal No.70487 of 2017 (Arising out of Order-In-Original No.06-Pr.Commr./NOIDA-CUS/2017 dated 28.03.2017 passed by Principal Commissioner, Noida Customs) Shri Bhavesh Thakkar, .....Appellant-III (B-51, Navkunj No.4, Geeta Arcade Meera Road (E) Thane, Mumbai) VERSUS Commissioner of Customs (Preventive), ....Respondent (ICD Dadri, Noida-201311) Customs Appeal No.70508, 70509, 70483-70488 of 2017 2 APPEARANCE:
Shri Piyush Kumar, Advocate for the Appellant Shri Santosh Kumar, Authorised Representative for the Respondent AND Customs Appeal No.70488 of 2017 (Arising out of Order-In-Original No.06-Pr.Commr./NOIDA-CUS/2017 dated 28.03.2017 passed by Principal Commissioner, Noida Customs) Shri Mukesh Thakkar, .....Appellant-IV (S/o Shri Shankarlal Thakkar, C-1, 204, Mayfil Tower, Charmswood Village, Faridabad-121009) VERSUS Commissioner of Customs (Preventive), ....Respondent (ICD Dadri, Noida-201311) APPEARANCE:
Ms Reena Rawat, Advocate for the Appellant Shri Santosh Kumar, Authorised Representative for the Respondent CORAM: HON'BLE MR. P.K. CHOUDHARY, MEMBER (JUDICIAL) HON'BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) FINAL ORDER NOs.70593-70596/2024 DATE OF HEARING : 03 June, 2024 DATE OF DECISION : 03 June, 2024 SANJIV SRIVASTAVA:
These appeals are directed against Order-In-Original No.06-Pr.Commr./ NOIDA-CUS/2017 dated 28.03.2017 of the Principal Commissioner, Noida Customs. By the impugned order following has been held:
"ORDER 8.1.1 I hereby order for absolute confiscation of the recovered and seized 3024 nos. of Refrigerant 22 gas cylinders having a wholesale pricc of Rs.1,64,50,560/-
and assessable value of Rs. 1,33,02,334/- fraudulently Customs Appeal No.70508, 70509, 70483-70488 of 2017 3 imported by Ms. Ramesh and Company, Opposite Preet, Foundary, G.T. Road, Sirhind Side, Mandi Gobindgarh 147301, under Section 111(d), (f), (g), (i), (j), (l) and
(m) of the Customs Act, 1962.
8.1.2 I order for confiscation of Heavy Melting Scrap (HMS) seized, used as cover goods having a wholesale price of Rs.63,19,764/- and assessable value of Rs.55,49,034/- imported by Ms. Ramesh and Company, Opposite Prect Foundary, G.T. Road, Sirhind Side, Mandi Gobindgarh 147 301 under Section 111(d), (f), (g), (i), (j), (l) and
(m)read with Section 116 & 119 of the Customs Act, 1962. However, I give the party an option to redeem the goods on payment of redemption fine of Rs,14,00,000/-(Rupees Fourtcen Lakh) only in lieu of confiscation of goods under Section 125(1) of the Customs Act, 1962, which may be exercised within thirty days of the issue of this order.
8.1.3 I hereby impose a penalty Rs. 20,00,000/- (Rupees Twenty Lakh) only upon M/s. Ramesh and Company under the provisions of Section 112(a) (i) of the Customs Act, 1962.
8.1.4 I hereby impose a penalty Rs, 10,00,000/- (Rupees Ten Lakh) only upon M/s. Ramesh and Company under the provisions of Section 114AA of the Customs Act, 1962. 8.1.5 I hereby impose a penalty of Rs, 15,00,000/- (Rupees Fifteen Lakh) only upon Shri Ashok Kumar Goyal, Manager and Power of Attorney holder of Ms. Ramesh and Company, under Section 112(a)(i) of the Customs Act, 1962.
8.1.6 I hereby impose a penalty of Rs. 5,00,000/- (Rupees Five Lakh) only upon Shri Ashok Kumar Goyal, Manager and Power of Attorney holder of Ms. Ramesh and Company, under Section 114AA of the Customs Act, 1962.
8.1.7 I hereby order for the absolute confiscation of the recovered and seized 3024 nos. of Refrigerant 22 gas Customs Appeal No.70508, 70509, 70483-70488 of 2017 4 eylindera having a wholesale price of Rs.1,64,50,560/- and assessable value of Rs, 1,33,02,334/- fraudulently imported by M/s. Vipan and Company under Section 111(d), (f), (g), (i), (j), (l) and (m) of the Customs Act, 1962.
8.1.8 I order for confiscation of Heavy Melting Scrap (HMS) seized, used as cover goods having a wholesale price of Rs. 67,58,220/- and assessable value of Rs.51,84,811/- imported by M/s. Vipan and Company, under 111(d),
(f), (g), (i), (j), (l) and (m) read with Section 116 & 119 of the Customs Act, 1962, However, 1 give the party an option to redeem the goods on payment of redemption fine of Rs, 13,00,000/- (Rupees Thirteen Lakh) only in lieu of confiscation of goods under Scction 125(1) of the Customs Act, 1962, which may be exercised within thirty days of the issue of this order.
8.1.9 I order for confiscation of the seized 694 nozzles having wholesale value of Rs.1,38,800/- and assessable value of Rs.97,160/- fraudulently imported by M/s Vipan and Company, under Section 111(d), (f), (g), (i), (j), (l) and (m) of the Customs Act, 1962 However, I give the party an option to redeem the goods on payment of redemption fine of Rs. 25,000/- (Rupees Twenty Five Thousand) only in lieu of confiscation of goods under Section 125(1) of the Customs Act, 1962, which may be exercised within thirty days of the issue of this order. 8.1.10 I order for confiscation of the seized one Samsung LED TV (40") having MRP of Rs.60,000/- and assessable value of Rs.40,000/- fraudulently imported by Ms Vipan and Company, under Section 111(d), (f), (g), (i), (j), (l) and (m) of the Customs Act, 1962. However, I give the party an option to redeem the goods on payment of redemption fine of Rs. 8,000/- (Rupees Eight Thousand) only in lieu of confiscation of goods under Section 125(1) of the Customs Act, 1962, which may be exercised within thirty days of the issue of this order.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 5 8.1.11 I hereby impose a penalty of Rs. 20,00,000/- (Rupees Twenty Lakh) only upon M/s Vipan & Company, under Section 112(a) (i) and 114AA of the Customs Act, 1962. 8.1.12 I hereby impose a penalty of Rs. 10,00,000/- Rupees Ten Lakh) only upon M/s Vipan & Company, under Section 114AA of the Customs Act, 1962.
8.1.13 I hereby impose a penalty of Rs. 20,00,000/- (Rupees Twenty Lakh) only upon Shri Bhavesh Thakkar, owner of M/s. Shyam Shipping Agency, under Section 112(a)
(i) of the Customs Act, 1962.
8.1.14 I hereby impose a penalty of Rs 10,00,000/- (Rupees Ten Lakh) only upon Shri Mukesh Thacker, under Section 112(a)(i) of the Customs Act, 1962. 8.1.15 I hereby impose a penalty of Rs 20000001- (Rupees Twenty Lakh) only upon Shri Kamlesh Ratanshi Sonagela under Section 112(a)(i) of the Customs Act, 1962.
8.1.16 I hereby impose a penalty of Rs. 15,00,000/- (Rupees Fifteen Lakh) only upon Shri Kamlesh Ratanshi Sonagela under Section 114AA of the Customs Act, 1062.
8.1.17 I hereby drop the penal proceedings initiated against M/s Premier Cargo Movers. CHUB, under Section 117 of the Customs Acs 1962 All the adjudged dues should be paid forthwith."
1.2 No appeal has been filed by any person other than the four appellants before us.
2.1 An intelligence received in the Directorate of Revenue Intelligence (Hqrs.), New Delhi (hereinafter referred to as "the DRI") indicated that a syndicate of unscrupulous persons was involved in illegal import of R-22 Gas Cylinders, an Ozone Depleting Substance,a restricted item into India. Further, a specific intelligence was received in DRI indicating that the said syndicate was in the process of illegal import of R-22 gas cylinders from Dubai in the name of two importers namely M/s. Ramesh and Company, Mandi Gobindgarh. Punjab(hereinafter Customs Appeal No.70508, 70509, 70483-70488 of 2017 6 referred to as "Ramesh & Company") and M/s. Vipan and Company, Mandi Gobindgarh, Punjab (hereinafter referred to as "Vipan & Company"), through Inland Container Depot, Loni, Ghaziabad (U.P.) by concealing the same in the containers under the cover of declared goods i.e. Heavy Melting Scrap (HMS). Intelligence also suggested that the containers shipped by M/s. Aditi Global General Trading LLC, Dubai, UAE, were being used for concealment of R-22 gas cylinders and 11 containers covered under the Bill of Lading No. JBL/LON/FCL/20141531 dated 21.06.2014 issued by M/s. Balaji Shipping Lines FZCO, Shipper, M/s. Aditi Global General Trading LLC, Dubai, UAE, consigned to M/s. Vipan and Company, declared to contain 228850 kg of HMS were taken up for examination at ICD, Loni, Ghaziabad (UP) under panchnamas on various dates from 04.7.2014 to 10.07.2014.
2.2 On examination of above 11 containers on 04.07.2014, 05.07.2014, 07.07.2014, 08.07.2014, 09.07.2014 and 10.07.2014, imported by M/s. Vipan and Company, shipped by M/s. Aditi Global General Trading LLC, Dubai, UAE, under Bill of Lading No. JBL/LON/FCL/20141531 dated 21.06.2014, issued by M/s. Balaji Shipping Lines FZCO, in all 3024 pcs. of R-22 Gas Cylinders having marking "REFRIGERANT22CHLORODIFLUOROMET H ANE CHCIF2 CAS 75- 45-6 NONFLAMMABLE LIQUEFID GAS NON-REFILLABLE NON- REUSABLE 30 LBS. NET WEIGHT 13.6 KG" concealed behind the HMS by using a false partition between the stock of HMS and R- 22 gas cylinders along with 221355 kgs of HMS, one Samsung LED TV and 694 nozzles were recovered and the same were seized under Panchnama dated 11.08.2014 on a reasonable belief that the recovered R-22 Gas Cylinders illegally imported in contravention of restriction imposed under various laws,.were liable to confiscation under Section 111 and Section 119 of the Customs Act, 1962, respectively. One Samsung LED TV and 694 pcs. of nozzles illegally imported by Ms. Vipan and Company, in container no. BLJU 2083609 were also placed under seizure Customs Appeal No.70508, 70509, 70483-70488 of 2017 7 under Section 110 of the Customs Act, 1962, vide Seizure Memo dated 17.12.20 14 2.3 In the mean-time, 25 containers imported by M/s. Ramesh and Company and 10 containers were imported by M/s Vipin and Company declared to contain HMS arrived at ICD, Loni, Ghaziabad (UP). On examination of the containers of M/s Ramesh and Company the said containers, were found to contain HMS along with 3024, R.22 Gas Cylinders having marking "REFRIGERANT 22 CHLOROFLUOROCARBO CHCIF2 CAS 75-45-6 NON-FLAMMABLE LIQUEFID GAS NON-REFILLABLE NON- REUSABLE 30 LBS.NET WEIGHT 13.6 KG" concealed behind the HMS by using a false and temporary partition between the stock of HMS and R-22 gas cylinders were found.
2.4 Shri Ashok Kumar Goyal, (Appellant 1) Manager of M/s. Ramesh and Company and acting on power of attorney by his father Shri Raj Kumar, Proprietor of M/s Ramesh and Co. during the panchnama proceedings, disclosed that he was aware of the fact that out of the 11 containers , covered under above Bill of Lading, 06 containers contained 3024 R-22 Gas Cylinders (504 cylinders in each of the 06 containers). Shri Ashok Kumar Goyal knew that there was a temporary partition by way of iron sheet clearly segregating the R-22 Gas Cylinders from that of HMS, which was deliberately adopted as a strategy to conceal the R-22 Gas Cylinders in case of examination by the Customs officers and simultaneously to avoid collision between the R-22 Gas Cylinders and the HMS. In all, 3024 pcs. of Gas Cylinders containing R-22 gas illegally imported by concealing behind the HMS by way of creation of temporary partition by an iron sheet covering 90% in height and covering the breadth of the containers, to disable the view from the front on examination and HMS weighing 206995 kgs used as to cover goods imported by M/s. Ramesh and Company were seized under the provisions of the Customs Act, 1962.
2.5 M/s. Vipan and Company, vide their two letters both dated 26.08.2014 requested DRI, New Delhi, for permitting them to file Bill of Entry in respect of Bills of Lading No. Customs Appeal No.70508, 70509, 70483-70488 of 2017 8 JBL/LON/FCL/20141531 dated 21.06.2014 and JBL/LON/FCL/20141606 dated 27.06.2014 for provisional release of seized goods. Similarly, Ms. Ramesh and Company, vide their two letters both dated 26.08.2014 requested the DRI, New Delhi, for permitting them to file the Bill of Entry in respect of Bills of Lading No. JBLLONFCL/20141 529 dated 21.06.2014 and JBL/LONFCL/20141608 dated 27.06.2014 for provisional release of seized goods.
2.6 Scrutiny of past import documents of M/s. Vipan and Company and M/s. Ramesh and Company, available with Customs office at ICD, Loni, Ghaziabad, was also done, which indicated that both the importers were clearing their imported goods through M/s. Premier Cargo Movers, Customs House Broker (CHB), situated at Ist Floor, TA-4, Main Jagdamba Road, Tughlakabad Extension, New Delhi. The above business premises of M/s. Premier Cargo Movers, (CHB), were searched on 04.07.2014 by the DRI and two files pertaining to M/s. Vipan and Company and M/s. Ramesh and Company were resumed along with one CPU under the provisions of the Customs Act, 1962. During the search, the personnel of M/s. Premier Cargo Movers informed that the office of another firm namely M/s. Shyam Shipping Agency (Owned by Shri Bhavesh Thakkar (Appellant 3) and having Shri Mukesh Thacker (Appellant 4) as employee) is also situated at the said premises which was engaged in the business of transportation and shifting of the containers imported by above two importers.
2.4 After completion of investigations and enquiries, a Show Cause Notice 26.12.2014, was issued to the appellants and others. Show Cause Notice was followed by the Corrigendum dated 30.04.2015, an addendum dated 17.06.2015. The appellants and others were called upon to show cause as to why:
3.1 Ms. Ramesh and Company, Opposite Preet Foundary.
Mandi Gobindgarh 147301 (Punjab)'to explain as to why:
3.1.1 The recovered and seized 3024 nos. of Refrigerant 22 gas cylinders having a wholesale Customs Appeal No.70508, 70509, 70483-70488 of 2017 9 price of Rs,1,64,50,560/- and assessable value of Rs. 1,33,02,334/- fraudulently imported in the containers covered under Bill of Lading No. JBL/LON/FCL/20141608 dated 27.06.14 should not be confiscated under Section 111(d), (f), (g),
(i), (j), (l) and (m) of the Customs Act, 1962.
3.1.2 Heavy Melting Scrap (HMS) seized, used as cover goods in the containers covered under Bill of Lading No. JBL/LON/FCL/20141 608 dated 27.06.14 having a wholesale price of Rs.63,19,764/- and assessable value of Rs.55,49,034/- should not be confiscated under Section 111(d), (f), (g), (i), (j), (l) and (m) read with Section 116 & 119 of the Customs Act, 1962. 3.1.3 Penalty should not be imposed upon them under Section 112(a) (i) & 114AA of the Customs Act, 1962.
3.1.4 Shri Ashok Kumar Goyal, Manager and Power of Attorney holder, M/s. Ramesh and Company, H. No. 346, Adarsh Nagar, Street No. 3, Mandi Gobindgarh-147301 (Punjab) to explain as to why penalty should not be imposed upon him under Section 112(a)(i) and 114AA of the.Customs Act, 1962 for his omission and commission.
3.2 Shri Vipan Kumar Garg, Proprietor, M/s Vipan and Company 281, Sector-5A, G.T. Road, Srhind Side, Mand Gobindgarh - 147 301 (Punjab), to explain as to why:
3.2.1 The recovered and seized 3024 nos. of Refrigerant 22 gas cylinders having a wholesale price of Rs.1,64,50,560/-and assessable value of Rs. 1,33,02,334/- fraudulently imported in the containers covered under Bill of Lading No. JBL/LON/FCL/20141531 dated 21.06.14 should not be confiscated under Section 111(d), (f), (g),
(i), (j), (l) and (m) of the Customs Act, 1962.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 10 3.2.2 Heavy Melting Scrap (HMS) seized, used as cover goods in the containers covered under Bill of Lading No. JBL/LON/FCL/20141$31 dated 21.06.14 having a wholesale price of Rs.67,58,220/- and assessable value of Rs.51,84,811/- should not be confiscated under Section 111 (d), (f), (g), (i), (j), (l) and (m) read with Section 116 & 119 of the Customs Act, 1962.
3.2.3 seized 694 nozzles having wholesale value of
Rs.1,38,800/- and assessable value of
Rs.97,160/- and one Samsung LED TV (40") faving MRP of Rs.60,000/- and assessable value of Rs.40,000/- should not be confiscated under Section 111(d), (f), (g), (i), (j), (l) and (m) of the Customs Act, 1962.
3.2.4 3.2.4 Penalty should not be imposed upon M/s Vipan & Company under Section 112(a) (i) & 114AA of the Customs Act, 1962.
3.3 Shri Bhavesh Thakkar, Owner of Ms. Shyam Shipping Agency and S/o Shri Jethmal Thakkar, B-51, Navkunj Apartment, New Delhi and permanent resident of 603, Building No. 4, Geeta Arcade Meera Road (E), Thane, Mumbai - 401107 (MS) to explain as to why penalty should not be imposed upon him under Section 112(a)(i) of the Customs Act, 1962 for the omission and commission brought out hereunder.
3.4 Shri Mukesh Thacker, S/o Shri Shankarlal Thackar, R/o C-1, 204, Mayfil Tower, Charmswood Village, Faridabad, Haryana and permanent resident of C/o Shri Shankarlal Thacker, Luhana Street, Naliya, Dist. Kutch, Gujarat to explain as to why penalty should not be inposed upon him under Section 112(a)(i) of the Customs Act, 1962 for his omission and commission.
3.5 Shri Kamlesh Ratanshi Sonagela, s/o Shri Ratanshi Kakubhai Sonagela, resident of Lohana Street, Naliya Customs Appeal No.70508, 70509, 70483-70488 of 2017 11 Kachchh-370655 Gujarat (permanent address), resident of R.P.V. Vasa, Flat No.1 Bhagwan Niwas, R.R.T. Road, Mulund (W), Mumbai- residing at 1002. Sheikha Mariyam 400080 (in-law's address) and presently Building, Opposite Standard Bank, Baniyas Road, Deaira, Post Box 139, Dubai to explain as to why 'penalty should not be imposed upon him under section 112(a)(i) and section 114AA of the Customs Act, 1962 for his omission and commission.
3.6 M/s Premier Cargo Movers, Building No. 170-171, Flat No. 6-7(First Floor), Gautam 3.6 Nagar, Opposite B-4, Gulmohar Park, New Delhi-110049, holder of CHB licence no. R- 31/99 issued by Commissioner of Customs, NCH, New Delhi to explain as to why penalty should not be imposed upon him under penal action as envisaged under Section 117 of the Customs Act, 1962.
2.4 The show cause notice has been adjudicated as per the impugned order. Aggrieved appellants have filed these appeals, challenging the penalties imposed upon them.
3.1 We have heard Shri Ashish Bhatt Advocate for Appellant 1, Ms Jyotika Sharma Advovate for Appellant 2, Shri Piyush Kumar Advocate for Appellant 3, and Ms Reena Rawat, Advocate for Appellant 4,. We have also heard Shri Santosh Kumar Authorized Representative for the revenue.
3.2 Arguing for Appellant 1 learned counsel submits that appellant do not dispute that goods found in the container were not as per declaration made. They also do not dispute that the fact that for various acts of omission and commission, rendering goods liable for confiscation under Section 111 of the Customs Act, 1962, penalty has been imposed upon them. However the penalties imposed upon appellant under Section 112 (a) (i) of Rs 20,00,000/- and under Section 114AA of Rs 10,00,000/- is excessive. For the reason that appellant has suffered huge losses in his business he would only pray for reduction in the penalties imposed.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 12 3.3 Arguing for Appellant 2 learned counsel submits that consolidated penalty of Rs 20,00,000/- has been imposed under Section 112 (a) (i) of Customs Act, 1962 and also a penalty of Rs 10,00,000/- has been imposed again under Section 114 AA of Customs Act, 1962. The imposition of penalty twice under the provisions of Section 114 AA of the Customs Act,1962 would amount to double jeopardy and the separate penalty imposed under Section 114AA needs to be set aside.
For the reason that appellant has suffered huge losses in his business he would only pray for reduction in the penalties imposed.
3.4 Arguing for Appellant 3 learned counsel submits that-
His firm was the CHA & Freight Forwarder in respect of the consignment examined by the DRI during the period 04.07.2014 to 10.07.2014.
After examination a summon was issued to him and an statement recorded by the investigating officer on 15.07.2014. Nothing incriminating was found. Thereafter on 28.07.2014 & 04.08.2014 DRI recorded the statement of Appellant 1. In his inculpatory statement, Appellant 1 insinuated the Appellant.
Similarly in his statement recorded on 21.07.2014, Appellant 2 insinuated the Appellant.
DRI summoned Appellant 1 and Appellant 2 and again recorded their statement on 09/10.12.2014. On the basis of their statement Appellant and his employee Appellant 4 were also summoned.
Officers perforce obtained the Appellants signature on a statement already prepared and typed on their computer and thereafter arrested the importers as well as Appellant and his employee.
Immediately on production before the before the ACJM Ghaziabad, the appellant apprised the court of coercion/ mistreatment and retracted his statement.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 13 Penalty has been imposed upon the appellant solely relying on his statement dated 10.12.2014 which was neither voluntary nor made by him, but on which he was made to sign perforce.
It is settled law that appellant cannot be held guilty on the basis of the statements of co-accused and his retracted statements. Reliance is placed on the following decisions. o Vinod Solanki [2009 (13) STR 337 (SC)] o Rakesh kappor [2015 (326) ELt 465 (Del)] o Mahendra Kumar Singhal [2016 (333) ELT 250 (Del)] o Jaswinder Singh [1996 (83) ELT 175 (T)] o Ashwin S Mehta [2006 (197) ELT 386 (T-Mum)] o Mehmood Khan [2002 (140) ELT 97 (T-Kol)] 3.5 Arguing for Appellant 4 learned counsel adopted the arguments made by the counsel for Appellant 3.
3.6 Learned authorized representative re-iterated the findings recorded in the impugned order.
4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments.
4.2 Impugned order records the findings as follows:
7.4 The next issue before me to decide is whether penalty is to be imposed upon Shri Ashok Kumar Goyal, Manager and Power' of Attorney Holder of M/s Ramesh and Company under Section 112(a) (i) & 114AA of the Customs Act, 1962.
7.4.1 I have gone through the statements dated 28.07.2014, 04.08.2014 10.12.2014 of Shri Ashok Kumar Goyal and observe that he was one of the key conspirators in the illegal import of R- 22 gas cylinders in close association with Shri Bhavesh Thakkar and Shri Kamlesh Ratanshi Sonagela. Shri Ashok Kumar Goyal used the remittance US $ 50,000/- (Rs. 30,00,000/-) for his past consignments to part finance the purchase of R-22 gas cylinders in Dubai with the balance of Rs. 90,00,000/- coming from Shri Kamlesh Ratanshi Sonagela. Shri Ashok Kumar Goyal entrapped / enticed his business partner, Shri Vipan Garg to also import R-
Customs Appeal No.70508, 70509, 70483-70488 of 2017 14 22 gas cylinders in his consignments of HMS. Shri Vipan Garg gave his approval over phone and agreed to import R-22 gas cylinders in his consignments of HMS and agreed to share the profit like Shri Ashok Kumar Goyal and Shri Bhavesh Thakkar. He did not declare his relationship with the supplier companies to the Customs Authority as required under the provisions of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 to examine whether the relationship between the supplier company and the importer had influenced the selling price. He imported the R-22 gas cylinders in violation of Rules 5(1), 6, 7 and 10 of the Ozone Depleting Substance Rules, 2000 as amended by Ozone Depleting Substances (Regulation and control) Amendment Rules, 2014. He was also not authorized/registered person to import, sell, stock or exhibit for sale or distribute, purchase Ozone Depleting Substance under Rules 3, 30, 31 and 32 of the Gas Cylinders Rules, 2004.
7.4.2 It becomes crystal clear that, Shri Ashok Kumar Goyal, played an important role in getting the R-22 gas cylinders loaded in his presence by way of concealment in such a manner, whereby a temporary and false partition was erected running across the breadth of the container and 80-90% in height of the container. This was a well devised strategy on the part of Shri Ashok Kumar Goyal, to conceal the R-22 cylinders in such a way to disable the view from the front in case of examination by the Customs Officers at ICD, Loni, Ghaziabad (UP). Shri Ashok Kumar Goyal remained throughout the stuffing of R-22 gas cylinders and returned to India only after that. He all along knew that he did not have a valid licence permit/ authorization issued by DGFT for the legal import and instigated, aided and abetted smuggling of R-22 gas cylinders. His role, in the case has also been confirmed and corroborated by the statements of Shri Bhavesh Thakkar and Shri Kamlesh Ratanshi Sonagela. Thus, by his above acts of omission & commission, Shri Ashok Kumar Goyal rendered the said goods liable to confiscation under Section 11 1 of the Customs Act, 1962, and thereby has violated the provisions of above mentioned various laws and rendered Customs Appeal No.70508, 70509, 70483-70488 of 2017 15 himself liable for penalty under Section 112(a)(i) ibid. For the false declaration given by him, he is also liable to penal action under Section I14AA of the Customs Act, 1962.
7.4.3 I also find that Shri Ashok Kumar Goyal has retracted his statement, recorded on 28.07.2014, 4.8.2014, 9.12.2014 & 10.12.2014 under section 108 of Customs Act, 1962, before ACJM, Ghaziabad on 22.06.2016. The retraction has been filed after a gap of around two years after the recording of the statements, which is nothing but an afterthought to mislead the investigation and the adjudicating authority. The retraction has neither been filed before the statement recording authority nor within a reasonable time.
7.5 The next issue before me to decide is whether penalty is to be imposed upon Shri Vipan Kumar Garg, Properietor, M/s Vipan & Company under Section 112(a) (i) and Section 114AA of the Customs Act, 1962.
7.5.1 M/s Vipan and Company imported 11 containers declaring to contain 228850 Kgs of HMS, covered under Bill of Lading No. JBL/LON/FCL/2014531 dated 21.06.2014 issued by M/S Balaji Shipping Lines FZCO, & supplied by the M/s Aditi Global General Trading LLC. Dubai UAE which were taken up for 100% examination by the DRI on various dares from 04.07.2014 to 10.07.2014, the details in respect of which was as under, Sl Date Containe Declare Qty Goods found Qty of Remark . r No. d item/ declare on found if any N examine Goods d (in examination goods (in o d Kgs) . Kgs/Nos) 1 04.07.1 BLJU- HMS 20750 HMS 25045 4295 4 208290 Kgs excess 2 05.07.1 BLJU- HMS 20510 HMS 26575 6065 4 208981 Kgs excess 3 Do BLJU- HMS 21080 HMS 23945 2865 2452667 Kgs excess 4 07.07.1 BLJU- HMS 20310 HMS 24245 3935 4 2031307 Kgs excess 5 Do BLJU- HMS 20750 HMS/R-22 16185/504 4565 2083609 Gas / 1/694 kgs Customs Appeal No.70508, 70509, 70483-70488 of 2017 16 Cylinder/ short Samsung (HMS) + LED TV/ R-22 Nozzles Gas Cylinder s 6 08.07.1 BLJU- HMS 20770 HMS/R-22 14425/504 6345 4 2089952 Gas kgs Cylinder short (HMS) + R-22 Gas Cylinder s + Samsun g LED TV + Nozzles 7 Do BLJU- HMS 21090 HMS/R-22 17045/504 4045 2086125 Gas kgs Cylinder short (HMS) + R-22 Gas Cylinder s 8 09.07.1 BLJU- HMS 21310 HMS/R-22 16195/504 5115 4 2231603 Gas kgs Cylinder short (HMS) + R-22 Gas Cylinder s 9 Do SEGU- HMS 21190 HMS 27010 5820 1268548 Kgs excess HMS 10 10.07.1 BLJU- HMS 20130 HMS/R-22 14705/504 5425 4 2083240 Gas kgs Cylinder short (HMS) + R-22 Gas Cylinder s 11 Do BLJU- HMS 20960 HMS/R-22 15980/504 4980 2041769 Gas kgs Cylinder short (HMS) + R-22 Gas Cylinder s Total 228850 HMS/R-22 221355/ Gas 3024/ Cylinder/ 4/1/694 LED TV/ Nozzles 7.5.2 On perusal of the chart, I find that :11 containers imported by M/s. Vipan and Company, shipped by M/s. Aditi Global Customs Appeal No.70508, 70509, 70483-70488 of 2017 17 General Trading LLC, Dubai, UAE, covered under Bill of Lading No. JBL/LON/FCL/20141531 dated 21.06.2014; issued by Ms. Balaji Shipping Lines FZCO, declared to contain HMS were examined thoroughly by the DRI and the 3024 PCs. of R-22 Gas Cylinders having marking "REFRIGERANT 22 CHLORODIFLUOROMETHANE CHCIF2 CAS 75-45-6 NONFLAMMABLE LIQUEFID GAS NON-REFILLABLE NON- REUSABLE 30 LBS.NET WEIGHT 13.6 KG" were found concealed behind the HMS by using a false partition between the stock of HMS and R-22 gas cylinders. Also, 221355 kgs of HMS along with one Samsung LED TV and 694 nozzles were also recovered. The above recovered one Samsung LED TV and 694 pcs. of nozzles illegally imported by M/s. Vipan and Company, in container no. BLJU 2083609, were placed under seizure under Section 110 of the Customs Act, 1962, vide Seizure Memo dated 17.12.2014. The R-22 gas cylinders were seized as they were illegally imported in contravention of restriction imposed under various laws, were liable to confiscation under Section 11 1 of the Customs Act, 1962.
7.5.3 I find that in the Bill of Lading, in respect of the seized goods, only HMS was declared and R-22 gas cylinders were deliberately not mentioned because the party was not having any import licence or permit issued by DGFT as required under Rule 2(i) of the Ozone Depleting Substances (Regulation and Control) Rules, 2000. Ozone Depleting Substance means the "Ozone Depleting Substance" specified in column (2) of the Schedule 1, whether existing by itself or in a mixture, excluding any such substance or mixture (blend) which is in a manufactured product other than a container used for the transportation or storage of such substance. The molecular formula CHCIF2 or CHF2CI appears at Sr. No. 22 of the Schedule 1 of the ODS Rules, 2000; which is also referred as HCFC-22 and as Dichlorodi fluoromethane, notified vide Notification dated 19.07.2000. Vide the amendment notification dated 18.09.2007, in Col (3) of the entries relating to SI.No.22 of the letters and figures "dichlorodifluoromethane (CHF2C12)" THE WORD, LETTERS & Customs Appeal No.70508, 70509, 70483-70488 of 2017 18 FIGURES "Chlorodifluoromethane (CHF2CI)" was substituted. The party mis-declared the imported goods & tried to import the prohibited goods violating the provision of Section 11 of Customs Act, 1962.
7.5.4 Since the seized R-22 gas cylinders did not contain the name and address of the manufacturer, packer and importer of the packaged commodities weight, value, date of manufacture, MRP etc. as per statutory requirement under the Legal Metrology Act, 2009 and Rules made thereunder which led to the violation of the provisions of Legal Metrology Act 2009.
7.5.5 The party have imported the R-22 gas cylinders in violation of Rules 5(1), 6, 7 and 10 of the Ozone Depleting Substance Rules, 2000 as amended by Ozone Depleting Substances Regulation and control) Amendment Rules, 2014 as they were not authorized/registered person to import, sell, stock or exhibit for sale or distribute, purchase Ozone Depleting Substance under Rules 3, 30, 31 and 32 of the Gas Cylinders Rules, 2004.
7.5.6 I also find that Shri Vipan Garg, Proprietor of M/s Vipan and Company, in his statements tendered under section 108 of the Customs Act, 1962, has himself accepted that in the Bill of Lading, in respect of the seized goods, only HMS was declared and R-22 gas cylinders were deliberately not mentioned on account of his non-possession of any import licence or permit issued by DGFT. He agreed to import R-22 gas cylinders illegally for monetary consideration as he was going to get Rs. 350.00 for each R-22 gas cylinder. He knew very well that the import of R- 22 gas cylinders required license from DGFT, which he was not having. After going through he notification dated 19.07.2000 as amended by notification dated 18.09.2007 of Ministry of Environment and Forest, Gas Cylinders Rule, 2004, the Legal Metrology Act, 2009 and ODS (Regulation and Control) Rules dated 19.07.2000 and amended by Notification dated 18.09.2007, he admitted that R-22 gas cylinders were imported in violation of above legal provisions.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 19 7.5.7 By the above acts of omission & commission, the party, owned by Shri Vipan Kumar . Garg, have rendered the said goods liable to confiscation under Section 111 of the Customs Act,1962 and thereby rendered themselves liable for penalty under section 112(a)(i) ibid. For their false declaration, they are also liable to penalty under Section 114AA of the Customs Act,1962.
7.6 The next issue before me to decide is whether penalty is to be imposed upon Shri Bhavesh Thakkar, owner of M/s Shyam Shipping Agency under Section 112(a) () of the Customs Act, 1962.
7.6.1 Shri Bhavesh Thakkar in his statements dated 15.07.2014, 09.10.2014 & 10.12.2014, recorded under Section 108 of the Customs Act, 1962, stated that he was a partner of M/s. Aditi Global General Trading LLC, Dubai, having a stake of 16% share in which the other partners were Shri Ashok Kumar of M/s. Ramesh and Company (16%). Shri Kamlesh Ratanshi Sonagela, his cousin (17%) and one local person (51%). In the month of May, 2014, he visited Dubai and met Shri Ashok Kumar of M/s Ramesh & Co. and Shri Kamlesh Ratanshi Sonagela. Shri Kamlesh Ratanshi Sonagela proposed that they could earn a very good profit if they import R-22 gas cylinders from UAE to India, for which a detailed discussion regarding import of R-22 gas cylinders continued for 2-3 days between them. Since, there were strict import restrictions on R-22 gas cylinders in India, without license from DGFT, hence, it was decided that R-22 gas cylinders would be imported along with HMS. Shri Kamlesh Ratanshi Sonagela suggested that R-22 gas cylinders could be concealed in the back portion of the container by loading R-22 gas cylinders in the container first then putting an artificial partition after the R-22 gas cylinders and then loading the containers with HMS. In case, the container was opened by Indian Customs, the R-22 gas cylinders will not be noticed by them because of the artificial partition between HMS and R-22 gas cylinders He further, stated that during the purchase of R- 22 gas cylinders, he (Shri Bhavesh) was also present with Shri Customs Appeal No.70508, 70509, 70483-70488 of 2017 20 Kamlesh Ratanshi Sonagela and Shri Ashok Kumar at Dubai. Shri Kamlesh Ratanshi Sonagela and Shri Ashok Kumar had supervised the loading of R-22 gas cylinders and he also occasionally remained present during the loading of R-22 gas cylinders. He told Shri Mukesh Thacker that these containers were containing R-22 gas cylinders at the back portion & he will give him some extra money after clearance upon which Shri Mukesh Thacker agreed to take care of clearance and handing over the containers containing R-22 gas cylinders to the person of Shri Kamlesh at the place which was to be decided by them 7.6.2 I have perused the above statements of Shri Bhavesh Thakkar and I hold that he was one of the key conspirators in the illegal import of R-22 gas cylinders in close association with Shri Ashok Kumar Goyal and Shri Kamlesh Ratanshi Sonagela. He was fully aware that import of R-22 gas cylinders in India was under restricted category and the cylinders could not be imported into India without obtaining the specific permission/Licence from DGFT. He was also among the key players devising the strategy to conceal the R-22 gas cylinders at the back portion of the container behind HMS, by putting an artificial partition between the HMS & R-22 gas cylinders. His role also has been confirmed in the statements of other co- accused find that, he intentionally got involved in the illegal import of the R-22 gas cylinders to earn easy money puting aside consequences of his illegal activities. He violated the provisions of various laws as discussed above and by his acts of omision & commission, he rendered the said goods liable to confiscation under Section 111 of the Customs Act, 1962 and thereby rendered himself liable for penal action under Section 112(a)(i) ibid.
7.7 The next issue before me to decide is whether penalty is to be imposed upon Shri Mukesh Thacker, an employee of Ms Shyam Shipping Agency, New Delhi under Section 112(a) (i) of the Customs Act, 1962.
7.7.1 I have gone through the statement dated 09/10.12.2014 of Shri Mukesh Thacker recorded and the statement dated Customs Appeal No.70508, 70509, 70483-70488 of 2017 21 16.07.2014 of Ms. Rajani Sharma, and come to the conclusion that Shri Mukesh was a very trusted man of Shri Bhavesh Thakker, owner of M/s Shyam Shipping Agency, New Delhi. He was not getting any fixed salary from his employer as his salary amount depended upon his extra work and devotion. Normally, he did not use to go to the Customs office for import clearance but in case of import of M/s Ramesh and Company & M/s Vipan and Company, he himself used to go, along with 'G‟ Card holder, to ICD for Customs clearance. All the employees, 13 in number, in Delhi used to report to him and Shri Mukesh Thacker acted as a link between the Proprietor, Shri Bhavesh Thakkar and the employees of Delhi Branch of the firm. Shri Mukesh Thacker was authorized by Shri Bhavesh Thakkar to take appropriate decisions in their day to day business matters, in his absence. Shri Mukesh Thacker used to advise, supervise and give directions to the employees of Delhi branch of Ms. Shyam Shipping Agency. He maintained liaison with the importers and used to oversee the functioning of their Delhi Branch. He was the first person to talk to the importers and used to direct Ms. Rajani Sharma, Receptionist-cum-Customer Executive to get in touch with the shipping line to know the status of the shipment. Thus, he was solely responsible for the supervision of all the works related to the working and running of the Delhi branch of their firm. As per the statement of Ms Rajni Sharma, the imported goods were cleared only from ICD, Loni, Ghaziabad or from ICD, Dadri, NOIDA. In the instant case, he was told by his employer to take extra care of Customs clearance in respect of the import consignment of M/s Ramesh and Company & M/s Vipan and Company for which he was going to get some extra money from his employer i.e. Shri Bhavesh Thakkar 7.7.2 He was also shown the following statements tendered under Section 108 of the Customs Act, 1962,
(a) Statement of Sh. Bhavesh Thakkar dated 15.07.2014, 09/10.12.2014, Customs Appeal No.70508, 70509, 70483-70488 of 2017 22
(b) Statement of Ms. Rajani Sharma, Receptionist-cum-
Customer Service Executive of M/s Shyam Shipping Agency, New Delhi dated 16.07.2014,
(c) Statement of Sh. Vipan Garg of M/s Vipan & €o. dated 21.07.2014, 09/10.12.2014,
(d) Statement of Sh. Ashok Kumar Goyal dated 28.07.2014.
he (Shri Mukesh) agreed with his role regarding the clearance of goods including the goods imported by Ms Ramesh & Co. and M/s Vipan & Co. and the goods seized by DRI which have been correctly recorded in the above statements.
7.7.3 In view of his above-narrated role, it is evident that he knew each and everything about the illegal activities being carried out by the syndicate comprising Shri Ashok Kumar Goyal, Shri Vipan, Shri Kamlesh Ratanshi Sonagela and Shri Bhavesh Thakkar. By his acts of omission & commission, he rendered the said goods liable to confiscation under Section 111 of the Customs Act, 1962 and thereby rendered himself liable for penal action under Section 112 (a) (i) ibid."
4.3 We take note of the fact that Appellant 1 and Appellant 2 are respectively the persons responsible for the import of prohibited goods by concealing them in container declared by them to contain HMS. Both of them do not deny their role in the offence committed. Impugned order specifically records findings detailing the role played by them in such illegal importation and also refers to their confessional statements made before the investigating authority. Commissioner has rejected the retraction made by the Appellant 1 of his statements recorded as the same was made belatedly nearly after 2 years of recording the statement and has held the same to be an afterthought. The findings recorded in the impugned order have not been seriously disputed at the time of argument of the case. What the counsel for appellant has prayed for is leniency in determination of the quantum of the penalty imposed on these appellant.
4.4 Counsel for appellant 2 has also pointed out that the penalty on her client has been imposed twice under Section Customs Appeal No.70508, 70509, 70483-70488 of 2017 23 114AA for the same offence in the same proceedings for the same offence committed. She submitted as per 8.1.11 a consolidated penalty of Rs 20,00,000/- has been imposed on her client under Section 112 (a) (i) and Section 114AA and also a penalty of Rs 10,00,000/- has been imposed under Section 114AA of the Customs Act, 1962 as per 8.1.12. Imposition of the penalty twice under the Section 114AA as such should be considered as double jeopardy and protection available under Article 20 (2) of the Constitution of India would come into play to set aside the penalty imposed upon Appellant 2 as per 8.1.12. Thus the penalty imposed upon the appellant 2 as per para 8.1.12 is set aside.
4.5 Thus in respect of Appellant 1 and Appellant 2 while we uphold the penalties imposed under Section 112 (a) (i) and Section 114AA of the Customs Act,1962, taking note of the submissions with regards to financial capacity and the losses incurred, we reduce the same to 25% of the penalty imposed under these Sections.
4.6 Before we proceed further we take note of the submissions made by the appellant 3 and 4 before the adjudicating authority which as reproduced in the impugned order are as follows:
"4.3 Mukesh_Thacker s/o_ Shri_Shankerlal Thacker. Faridabad:- written reply was filed by Sh.Ram Pratap Kaushal, Advocate, CH, 180A, Patiala House Court, New Delhi, on behalf of Shri Mukesh Thacker, relevant portion of which is as under : -
(i) During the course of investigation, DRI interrogated the Noticee also on 09.12.2014 and 10.12.2014, obtained signature per force on the statements of other co-
noticees and now solely on the basis of the same have implicated the Noticee in the present case proposing penalty under Section 1 12(a)(1) of the Customs Act,1962. Copies of the statements available on record clearly show that he was not involved in any of the Customs Appeal No.70508, 70509, 70483-70488 of 2017 24 activities and performed his duties at the command of his master without being aware of the ground realities.
(ii) The only allegation against the Noticee in the entire Show Cause Notice is that the Co Noticee Shri Bhavesh Thakkar had informed the Noticee about the import of R-.22 Gas cylinder and hence the Noticee had knowledge of illegal import of R-22 Refrigerant Gas which in Noticee's respectful submission by any stretch of imagination cannot be construed as an offence under Section 1 12(a)(i) of the Customs Act, 1962.
(iii) Noticee further respectfully submits that it is not a case of the Department that the Noticee was instrumental in import of the goods, finalisation of the alleged illegal import or clearance thereof in any manner and it is not a case of the Department that the Noticee had introduced the importers to M/s. Shyam Shipping Agency and had handled the consignments in Customs area in any manner. The only allegation that he was aware of the presence of the R-22 Refrigerant gas which by itself cannot be construed as offence punishable under Section 112(a) (i) of the Customs Act, 1962 which reads as under:
SECTION 112. .....;
(iv) Though the Noticee submits that the statements of the noticee per sedo not include any incriminating material except a coerced acceptance of the statements of co-
noticees, yet the same do not support the case of the DRI to prove the guilt of violation of Section 112(a)(i) of the CustomsAct,1962 as proposed in the Show Cause Notice especially as the Noticee had retracted the statements at the first available opportunity before the Court of learned Chief Judicial Magistrate, Ghaziabad .Noticee therefore seeks indulgence of the Hon'ble Commissioner in calling for the case records and perusing the same in the interest of justice.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 25
(v) Besides it is a trite law that reliance on the retracted statement cannot be take place without any corroborative evidence as held by the Hon'ble Courts and Tribunal in a catena of judgments inter a/ia including the judgment rendered by the Hon'ble Supreme Court in the matter of Vinod Solanki Vs. UOI as reported in 2009 (13) S.T.R. 337 (S.C.), Delhi High Court in the matters of Rakesh Kapoor Vs. UOI as reported in 2015 (326) E.L.T. 465 (Del.), DRI Vs. Mahendera Kumar Singhal as reported in 2016 (333) E.L.T. 250 (Del.) and the Hon'ble Tribunal in the matter of Ashwin.S Metha Vs. CC as reported in 2006 (197) E.L.T. 386 (Tn. - Mum).
(vi) Other evidence relied by the DRI against the Noticee is the statement of other co noticees especially Shri Bhavesh Thakkar who to the best of the knowledge and belief of the Noticee had also retracted his statement before Hon'ble Trial Court at the first available opportunity. The Noticee submits that otherwise also it is a settled law that penalty cannot be imposed solely on the basis of the statement of the co noticees without any corroborative evidences as held by the Hon'ble Court and Tribunal in the matter of Pradeep Sah as reported in 2006(197)ELT 301(Tri), Jaswinder Sing Vs. CCas reported in 1996 (83) E.L.T. 175 (Tribunal) and in the matter ofMehmood Khan Vs. Commissioner of Customsas reported in2002(140)ELT97. The Noticee submits that the proposed penal action is liable to be set aside on this short ground alone.
(vii) Noticee also prays the Hon'ble Commissioner to kindly grant cross-examination of Shri Bhavesh Thacker, proprietor of M/s. Shyam Shipping Agency whose statement has been relied in the impugned Show Cause Notice to propose penalty on the Noticee to cull out true and correct facts of the case. Noticee further submits that cross examination is a justiciable right and any Customs Appeal No.70508, 70509, 70483-70488 of 2017 26 order passed without grating cross examination render the order illegal in view of the law propounded by the Hon'ble Supreme Court in the matter of Laxman Exports Vs. CCE - 2002(143) ELT 21 (SC) and the Honble Tribunal in the matters of M/s Rakihi Isoat Ltd. Vs. CCF
- 2001(129) ELT 701 (Tn.), Kedia Overseas Vs. CC - 2005 (179) ELT 156 and M/s Daisu Auto Parts Vs. CC.
(viii) In the conspectus of submission supra, Your Honour may appreciate that except for the the inculpatory statements, there is no allegation much less any evidence in the entire Show Cause Notice that the Noticee was aware of the presence of the R-22 Gas in the subject Bs/E, The Noticee therefore submits that he was neither aware nor was party to the alleged misdeclaration and therefore bringing the Noticee within the fold of Section 112(a) is patently wrong and misconceived and is not liable for penalty under Section 1 12(a)(i) of the Customs Act, 1962.
(ix) Therefore in Noticee's respectful submission, the Noticee cannot be said to have committed any act of commission or omission which has rendered the goods liable to confiscation or had abetted such an act nor to he connived with the offending goods in any manner to warrant invocation of penal provisions of Section 112(a)(1) of the Customs Act, 1962 against the Noticee, penalty proposed under the said Section is also not sustainable in law.
(x) Without prejudice to the above contention, Noticee submits that he was only an employee and was acting under the instructions of his employer and hence no penalty can be imposed upon the noticee being an employee, especially because there is no allegation much less any evidence tc suggest that the Noticee had ever derived any pecuniary gain. It is a settled law that an employee working under the instructions of his employer cannot be punished for alleged act. Reliance Customs Appeal No.70508, 70509, 70483-70488 of 2017 27 is placed on the judgments of the Hon'ble Tribunal in the matter of Sterlite Optical Technologies vs. C.& CE., Aurangabad 2005 (188) ELT 210 (Tri- Mumbai), Carpenter Classic Exim Pvt. Ltd. vs. Commissioner of Cus., Bangalore 2006 (200) ELT 593 (Tr-Bang), Associated plastics and Rayons vs. Commissioner of C. Ex. & Customs, Vapi 2007 (210) ELT 524 (Tri-Ahmd) and R.K. Srivastava vs. Commissioner of Customs, New Delhi 2008 (225) ELT` 523 (Tr-Del).
(xi) The Noticee submits that the averments made above are mutually exclusively in the alternative and without prejudice to one another and craves leave of the Hon'ble Commissioner to add, amend, alter and improve the facts during the course of hearing
(xii) In the conspectus of circumstances, the Noticee respectfully prays the Hon'ble Commissioner to drop the proceedings proposed against the Noticee in the impugned show cause notice in the interest of justice and in the event a contrary action is contemplated to grant cross examination of Shri Bhavesh Thakkar prayed in para 3.4 above and to afford a personal hearing to enable the Noticee to present his case for appreciation of his conduct in proper perspective.
4.4 Shri Bhavesh Thakkar, Proprietor of M/s Shyam Shipping Agency, B-51, Navkunj Apartment, New Delhi- 110092:- written defence reply was filed by Sh.Reena Rawat, Advocate, Piyush Kumar Associates, on behalf of Shri Bhavesh Thakker, relevant portion of which is as under :
(i) At the very outset Noticee submits that the case of the DRI against him is patently misconceived and baseless and therefore Noticee denies the allegations and repudiates the penal action proposed against him in totality.
(ii) Noticee is a proprietor of M/s. Shyam Shipping Agency, a freight forwarder, engaged in providing logistic Customs Appeal No.70508, 70509, 70483-70488 of 2017 28 support to the importers through the port of Inland Container Depot, Ghaziabad and Dadri since 2013.
Noticee submits that he has two offices one in Delhi and other is in Bombay and the Noticee runs both the offices through his employees. Besides the above business,the Noticee is a frequent flier to Dubai where he act as Indenter for some of the Dubai based companies of metal and waste paper on commission basis.
(iii) In the routine course of business in July, 2014, the Noticee's Delhi office received 6 B/Ls pertaining to the consignments arrived at the port of Inland Container Depot, Loni imported by M/s. Ramesh & Company and M/s. Vipan & Company As per procedure, Noticee's Delhi office collected the documents from the importers' representative Shri Ashok Kumar Goel and Shri Vipan Garg respectively for obtaining Delivery Orders and forwarded the same to the CHA M/s. Premier Cargo Services for preparation of Bs/E etc. In the meanwhile on 03.07.2014, DRI officers intercepted the containers covered under the said Bs/L and ordered that all the containers to be opened and examined in their presence, Accordinglythe goods were examined leading to recovery of 3024 cylinders of R-22 Refrigerant gas in Containers covered under B/L No. JBL/LON/FC/20141608 dated 27.06.2014 pertaining to M/s. Ramesh & Co and 3024 cylinders of R-22 Refrigerant gas from the containers covered under B/L No. JBL/LON/FC120141531 dated 21.06.2014 pertaining BsIL No. to M/s. Vipan & Co. In the remaining containers covered under 4 JBL/LON/FC/201 41529 dated 21.06.2014, JBL/LON/FCL/201 41398 dated09.06.2014,JBL/LON/FCL/20141 606 dated 27.06.2014 and JBL/LON/FCL/20141400 dated 09.06.2014, the goods were found as declared and the Customs Appeal No.70508, 70509, 70483-70488 of 2017 29 same were cleared on payment of duty after adjudication for slight difference in weight
(iv) In the course of investigation, DRI summoned the Noticee on15.07.2014, wherein the Noticee stated true and correct facts of the case and thereafter he was again summoned on 09.12.2014 wherein he was asked to signed the pre-typed statements and when the Noticee deny the same, he was beaten, maltreated and coerced to sign various typed pages containing incriminating facts and the Noticee was detained in illegal custody and on 10.12.2014 again the Noticee was made to sign some computer typed statements and thereafter arrested for offences under Section 132/135 of the Customs Act, 1962. Immediately on production before the Hon'ble Additional CJM, Ghaziabad, the Noticee retracted the statements and apprised about maltreatment. Now solely on the basis of above statements, the Noticee has been implicated as one of the mastermind in the present case proposing penalty under Section 112(a)(i) of the Customs Act, 1962. (Copy whereof is enclosed)
(v) Noticee at the very outset submits that the Show Cause Notice insofar as it relates to the answering Noticee is patently misconceived, out of context and contrary to the facts and circumstances of the case and attendant provisions of law and hence is neither sustainable on facts nor in law and therefore deserves to be dropped in limine and therefore, the Noticee begs to make the following submissions for kind consideration of the Hon'ble Commissioner. The Noticee submits that that except for providing freight forwarding services to the importers M/s Ramesh & Company and M/s. Vipan & Company, the Noticee has no involvement with the said Shri Ashok Kumar Goel and Shri Vipan Garg (connected persons of the above firms) and was neither directly nor indirectly involved with the above alleged Customs Appeal No.70508, 70509, 70483-70488 of 2017 30 illegal import of R-22 Refrigerant Gas Cylinders in the subject Bs/LJBL/LON/FCL/20141 608 dated 27.06.2014 and B/LJBL/LON/FCL/201 41531 dated 21.06.2014.
(vi) Noticee submits that the entire case has been made out solely on the basis of the inculpatory statements dated 15.07.2014 and 9/10.12.2014, which have been recorded under the close confines of DRI perforce and which at the first available opportunity had been retracted by the Noticee before the Hon'ble Trial Court. The Hon‟ble Commissioner may appreciate that it is settled law that retracted statement has not evidensuary value and cannot be relied against the Accused. Kind attention of the Hon'ble Commissioner is invited to the judgments rendered in the matters inter alia including the judgment rendered by the Hon'ble Supreme Court in the matter of Vinod Solanki Vs. UOI as reported in 2009 (13) S.T.R. 337 (S.C.), Delhi High Court in the matters of Rakesh Kapoor Vs. UOl as reported in 2015 (326) E.L.T. 465 (Del.), DRI Vs. Mahendera Kumar Singhal as reported in 2016 (333) E.L.T. 250 (Del.) and the Hon'ble Tribunal in the matter of Ashwin.S Metha Vs. CC as reported in 2006 (197) E.L.T. 386 (Tn. Mum).
(vii) Other evidence relied by the DRI against the Noticee is the statements of other co noticees Shri Ashok Kumar Goel, Power of Attorney Holder of M/s. Ramesh and Company and Shri Vipan Garg, proprietor of M/s. Vipan & Company. Noticee submits that he cannot be liable to penalty solely on the basis of the statements of the co Noticees without any corroborative evidences. Kind attention of the Hon'ble Commissioner is invited to the various judgments of the Hon'ble Court and Tribunal in the matter of Pradeep Sah as reported in 2006(197)ELT 301(Tri), Jaswinder Sing Vs. CC as reported in 1996 (83) E.L.T. 175 (Tribunal) and in the matter of Mehmood Khan Vs. Commissioner of Customs as Customs Appeal No.70508, 70509, 70483-70488 of 2017 31 reported in2002(140)ELT97 wherein the Hon'ble Courts and Tribunal time and again said that the penalty cannot be imposed solely on the basis of the statements of the co noticees without any other evidences against the Noticee. The Noticee therefore submits that the proposed penal action is liable to be set aside on this short ground alone.
(viii) Noticee also prays the Honble Commissioner to kindly grant cross-examination of Shri Ashok Kumar Goel, PA of M/s. Ramesh Kumar & Company and Shri Vipan Garg, proprietor of M/s. Vipan and Company and Shri Ratanishi Kakubhai Sonagela, whose statements have also been relied in the impugned Show-Cause Notice to propose penalty on the Noticee to cull out true and correct facts of the case Noticee further submits that cross- examination is a justiciable right and any order passed without granting cross-examination render the order illegal in view of the law propounded by the Honble Supreme Court in the matter of Laxman Exports Vs. CCE - 2002(143) ELT 21 (SC) and the Honble Tribunal in the matters of M/s Raklhi Ispat Ltd. Vs. CCE
- 2001(129) ELT 701 (Tn.), Kedia Overseas Vs. CC -- 2005 (179) ELT 156 and M/s Daisu Auto Parts Vs. CC.
(ix) In the conspectus of submission supra. Your Honour may appreciate that except for the inculpatory statements; there is no allegation much less any evidence in the entire Show Cause Notice that the Noticee was aware of the presence of the R-22 Gas in the subject Bs/E. The Noticee therefore submits that he was neither aware nor was party to the alleged misdeclaration and therefore bringing the Noticee within the fold of Section 112(a) is patently wrong and misconceived and is not liable for penalty under Section 11 2(a)(i) of the Customs Act,1962.
(x) Qua the allegation that the Noticee had full knowledge regarding the illegal import of R-22 gas cylinders in the Customs Appeal No.70508, 70509, 70483-70488 of 2017 32 impugned B/LS and he had meetings with the foreign supplier M/s. Aditi Global Genral Trading LLC Dubai and with the Indian importers at Dubai during June 2014 is patently wrong and misplaced. The Noticee submits that he visited Dubai in almost every month from January. 2014 to June, 2014 most of the time for his metal business and once attending function of one of his business friend Shri Kuldeep who deals in metal business and at no occasion he had meeting with Shri Ashok Kumar Goel or Shri Vipan Gupta in relation to alleged illegal import of R-22 Gas cylinders and hence the allegation that the Noticee had conspiracy or met the foreign supplier with Ahsok Kumar Goel at Dubai for planning illegal import of R-22 Gas is patently wrong and has solely been made on the basis of retracted statement of the Noticee and statements co-noticee without any cogent evidence and hence can not be relied.
(xi) As regards the allegation that the Noticee has oral understanding with the CHA M/s. Premier Cargo Movers and the Noticee used their CHA licence for customs clearance of the goods for a commission of Rs. 750 per container of 40ft and Rs 500/- per container for 20ft, - the Noticee submits that the above allegation is patently wrong and is without any basis. Hon'ble Commissioner may appreciate that in the year 2000, Noticee started his career as employee of M/s. Premier Cargo Movers and later obtained G card in M/s. Premier Cargo Movers which was cancelled in 2013. In the meanwhile, the Noticee started his own firm in the name of M/s. Shyam Shipping Agency engaged in freight forwarding and on the request of Shri Ramnish Kapoor, proprietor of M/s. Premier Cargo Movers. Noticee used to give Customs learance work which was handled by his firm through his employee Shri Raj Kumar Goswami and the Noticee have neither indulged Customs Appeal No.70508, 70509, 70483-70488 of 2017 33 or interfere in their business nor rented their Licence in any.
(xii) Qua the invocation of the provisions of Section 112(a)(i) of the Customs Act, 1962. the Noticee submits that the plain reading of the language of the Section reveals that the same are not attracted against the Noticee as the Noticee has not done any act of omission or commission which renders the goods liable to confiscation and it is the acts of the importers M/s. Vipan and Company and M/s. Ramesh and Company, if any, who had mis-declared the goods in the Bs/E. Section 112 of the Customs Act.1962 read as under
SECTION 112. ....
(xiii) Secondly, even charge of abetting can not be levelled against the Noticee to attract penalty under Section 112 of the Customs Act, 1962. The Noticee submits that the definition of abetment contained in Section 107 of the Indian Penal Code applies to all Central Acts in terms of the provisions of Section 3(1) of the General Clauses Act, 1897, hence, the words 'abets in doing' used in Section 112(a) of the Customs Act, 1962 are required to be construed in the same sense and given the same meaning as in the Indian Penal Code.
Relevant part of Section 107 of the Indian Penal Code is reproduced for quick reference:
"107 - ....
To aid in commission of the crime is the gist of the offence of abetment whereas in the present case neither the Noticee has connived or conspired with the importers prior to the import or at the time of import nor the Noticee was aware of the importers intention, or had derive or would derive any pecuniary gain out of the alleged intended mis-declaration which could entail a charge of abetting.
Customs Appeal No.70508, 70509, 70483-70488 of 2017 34
(xiv) Therefore in Noticee's respectful submission, the Noticee cannot be said to have committed any act of commission or omission which has rendered the goods liable to confiscation or had abetted such an act nor to be connived with the offending goods in any manner to warrant invocation of penal provisions of Section 112(a)(i) of the Customs Act, 1962 against the Noticee, penalty proposed under the said Section is also not sustainable in law.
(xv) The Noticee submits that the averments made above are mutually exclusively in the alternative and without prejudice to one another and craves leave of the Honbie Commissioner to add, amend, alter and improve the facts during the course of hearing.
(xvi) In the conspectus of circumstances, the Noticee respectfully prays the Hon'ble Commissioner to drop the proceedings proposed against the Noticee in the impugned show cause notice in the interest of justice and to afford a personal hearing to enable the Noticee to present his case for appreciation of his conduct in proper perspective."
4.7 In the impugned order the submissions made by the appellant 3 and 4 have not been addressed and the findings have been recorded against both appellant on the basis of the statements of the co-noticee and there own statement which were retracted by the appellant on the first available opportunity before the ACJM Ghaziabad. Impugned order is totally silent on the retraction of the said statements. However before we proceed further we would reproduce the statements recorded from the Appellant 3 and 4 in toto.
4.8 Statements of appellant 3 recorded on 15.07.2014 Customs Appeal No.70508, 70509, 70483-70488 of 2017 35 Customs Appeal No.70508, 70509, 70483-70488 of 2017 36 Customs Appeal No.70508, 70509, 70483-70488 of 2017 37 Customs Appeal No.70508, 70509, 70483-70488 of 2017 38 Customs Appeal No.70508, 70509, 70483-70488 of 2017 39 Customs Appeal No.70508, 70509, 70483-70488 of 2017 40 Customs Appeal No.70508, 70509, 70483-70488 of 2017 41 Statement recorded on 09/10.12.2014:
Customs Appeal No.70508, 70509, 70483-70488 of 2017 42 Customs Appeal No.70508, 70509, 70483-70488 of 2017 43 Customs Appeal No.70508, 70509, 70483-70488 of 2017 44 Customs Appeal No.70508, 70509, 70483-70488 of 2017 45 4.9 Statement of Appellant 4 recorded on 09/10.12.2014:
Customs Appeal No.70508, 70509, 70483-70488 of 2017 46 Customs Appeal No.70508, 70509, 70483-70488 of 2017 47 Customs Appeal No.70508, 70509, 70483-70488 of 2017 48 4.10 From the perusal of the statements as above we do not find any reason to hold that the statements dated 09/10.12.2014 were voluntary in nature. The said statement are typed written on all material details except for the request made by the appellants except for the request made by the appellant to take rest which has been allowed in hand by the investigating Customs Appeal No.70508, 70509, 70483-70488 of 2017 49 officer recording the statement. Appellant 4 has been for first time examined by the DRI on 09.12.2014 when he is shown certain statements which he accepts the next morning as reflecting his role in the entire scheme after staying overnight in the DRI office. He has not admitted anything in the potion of the statement recorded on 09.12.2014 and on the morning of 10.12.2014 he admits every statement made against him without a murmur and goes on to the extent of stating the paras of the statements made by the others, inculpating him to be arrested and produced before the ACJM. Interestingly the statement of Appellant 2 and Appellant 3 recorded on 10.12.2014 was shown to him on 09.12.2014. He retracted the statements made immediately on 10.12.2014 before the ACJM. Impugned order relies solely upon this statement to hold against him and impose the penalty under Section 112 (a) (i) of the Customs Act, 1962.
4.11 Appellant 3 was examined twice by the DRI. In his statement recorded on 15.07.2014 nothing inculpatory is coming stated and in the statement recorded on 09.12.2014 he admits everything without any reference to the any other evidence. He retracted the statement on the first available opportunity before the ACJM after being arrested on 10.12.2014. It is interesting to note on 10.12.2014 he makes the statement inculpating his own employee - Appellant 4 without any question in the matter.
Impugned order relies solely upon this statement to hold against him and impose the penalty under Section 112 (a) (i) of the Customs Act, 1962.
4.12 Impugned order do not record any reason for holding the statements dated 09/10.12.2014 as voluntary statements made by these two appellants. As we do not find these statements as voluntary penalty imposed on the appellant by placing reliance on these statements cannot be sustained. In case of Vinod Solanki refreed by the appellants following has been observed by the Hon'ble Supreme Court:
15. The questions which would arise for our consideration are: (1) whether the appellant had made bald statement at Customs Appeal No.70508, 70509, 70483-70488 of 2017 50 the time of retraction alleging threat and coercion so as to shift the burden of proof from him to the Enforcement Directorate; and (2) whether consolidated penalty could have been imposed only on the basis of such retracted confession.
16. Indisputably, a confession made by an accused would come within the purview of Section 24 of the Indian Evidence Act, 1872, which reads as under :
"24. Confession caused by inducement, threat or promise, when irrelevant in criminal proceeding. - A confession made by an accused person is irrelevant in a criminal proceeding, if the making of the confession appears to the Court to have been caused by any inducement, threat or promise, having reference to the charge against the accused person, proceeding from a person in authority and sufficient in the opinion of the Court, to give the accused person grounds, which would appear to him reasonable, for supposing that by making it he would gain any advantage or avoid any evil of a temporal nature in reference to the proceedings against him."
17. The proceeding under the Act is quasi criminal in nature. Section 50 of the Act is a penal provision prescribing that in the event of contravention of any of the provisions of the Act or of any rule, direction or order made thereunder, a penalty not exceeding five times the amount or value involved in any such contravention may be imposed.
18. Section 71 of the Act provides for burden of proof in certain cases. Sub-section (2) of Section 71 provides that the burden of proving that the foreign exchange acquired by such person has been used for the purpose for which permission to acquire it was granted shall be on such person.
19. The Act is a special Act, which confers various powers upon the authorities prescribed therein. Even the salutory principles of mens rea and actus reus in a proceeding under Customs Appeal No.70508, 70509, 70483-70488 of 2017 51 the Act may not be held to be applicable. It is now a well settled principle that presumption of innocence as contained in Article 14(2) of the International Covenant on Civil and Political Rights is a human right although per se it may not be treated to be a fundamental right within the meaning of Article 21 of the Constitution of India.
34. A person accused of commission of an offence is not expected to prove to the hilt that confession had been obtained from him by any inducement, threat or promise by a person in authority. The burden is on the prosecution to show that the confession is voluntary in nature and not obtained as an outcome of threat, etc. if the same is to be relied upon solely for the purpose of securing a conviction. With a view to arrive at a finding as regards the voluntary nature of statement or otherwise of a confession which has since been retracted, the Court must bear in mind the attending circumstances which would include the time of retraction, the nature thereof, the manner in which such retraction has been made and other relevant factors. Law does not say that the accused has to prove that retraction of confession made by him was because of threat, coercion, etc. but the requirement is that it may appear to the court as such.
35. In the instant case, the Investigating Officers did not examine themselves. The authorities under the Act as also the Tribunal did not arrive at a finding upon application of their mind to the retraction and rejected the same upon assigning cogent and valid reasons therefor. Whereas mere retraction of a confession may not be sufficient to make the confessional statement irrelevant for the purpose of a proceeding in a criminal case or a quasi criminal case but there cannot be any doubt whatsoever that the court is obligated to take into consideration the pros and cons of both the confession and retraction made by the accused. It is one thing to say that a retracted confession is used as a corroborative piece of evidence to record a finding of guilt Customs Appeal No.70508, 70509, 70483-70488 of 2017 52 but it is another thing to say that such a finding is arrived at only on the basis of such confession although retracted at a later stage.
36. Appellant is said to have been arrested on 27-10-1994; he was produced before the learned Chief Metropolitan Magistrate on 28-10-1994. He retracted his confession and categorically stated the manner in which such confession was purported to have been obtained. According to him, he had no connection with any alleged import transactions, opening of bank accounts, or floating of company by name of M/s. Sun Enterprises, export control, Bill of Entry and other documents or alleged remittances. He stated that confessions were not only untrue but also involuntary.
4.13 Relying upon the above decision Hon'ble Delhi High Court has in the case of Mahendra Kumar Singhal [2016 (333) ELT 250 (Del)] held as follows:
"9. Mr. Aggarwala submitted that learned trial Court has erred in not noticing decisions of the Supreme Court in Naresh J. Sukhawani v. Union of India - 1996 (83) E.L.T. 258 (S.C.), K.I. Pavunny v. Asstt. Collector (HQ), Central Excise Collectorate, Cochin - (1997) 3 SCC 721 = 1997 (90) E.L.T. 241 (S.C.) which held that even a retracted confessional statement could form the basis of a conviction. He submitted that a mere retraction was not sufficient unless it was proved by the respondent by himself entering into the witness box to explain the circumstances under which he was forced to give a confessional statement. Mr. Aggarwala sought to distinguish the decision in Noor Aga v. State of Punjab - 2008 (3) JCC (Narcotics) 135 as being made in the context of the NDPS Act. As regards the decisions in Vinod Solanki v. Union of India - JT 2009 (1) SC 1 = 2009 (233) E.L.T. 157 (S.C.) = 2009 (13) S.T.R. 337 (S.C.) and Union of India v. Bal Mukund - 2009 (2) JCC (Narcotics) 76, Mr. Aggarwala submitted that they were distinguishable on facts. Mr. Aggarwala placed reliance on Customs Appeal No.70508, 70509, 70483-70488 of 2017 53 the decision in Kanhaiyalal v. Union of India, 2008 (1) JCC (Narcotics) 23.
10. At the outset, it requires to be noticed that at the very first instance when the respondent was produced before the learned ACMM, he submitted an application, in which, inter alia, he stated that he had been subjected to third degree methods by the DRI. He stated that the so called confessional statement of his was neither voluntarily nor truthful. He stated that he had been illegally detained by the DRI for about 48 hours and forced to sign blank papers. There is an endorsement on the said application by learned ACMM which forms part of the judicial record. Further, the order passed by the learned ACMM on 13th October, 1988, while refusing bail to the respondent at that stage, noted the submission made by his counsel that „his confessional statement has been recorded under threat and after administering third degree method upon him.‟
11. Consequently, this Court is unable to accept the plea of Mr. Aggarwala that there is no valid and legal retraction by the respondent in the present case.
12. In Vinod Solanki v. Union of India (supra), the Supreme Court explained that where the confessional statement made by accused was retracted, the Court has to be conscious about the manner in which retraction has been made and other relevant factors. It was observed that a retracted confession could be used as a corroborative piece of evidence but cannot form the sole basis for returning a finding of guilt. In Union of India v. Bal Mukund (supra), in the context of confessional statement under Section 67 of the NDPS Act, the Supreme Court noticed that there can be conviction only if there is an independent corroboration of the retracted statement. In Noor Aga v. State of Punjab (supra), the said position was reiterated. The Court held that where the confessional statement was retracted, the burden shifted on the prosecution to prove that it was made voluntarily. It was pointed out that the confessional Customs Appeal No.70508, 70509, 70483-70488 of 2017 54 statement made by the accused while in custody was weak in nature.
13. In the present case, the witnesses who implicated the respondent were not produced for cross-examination. Mr. Aggarwala submitted that the other two „co-persons‟ viz, co-
accused had made confessional statements. However, it is pointed out by Mr. Naveen Malhotra learned counsel for the respondents, that neither of them in fact named the respondent."
4.14 Thus summarizing our findings individually in respect of each of the appellants:
I. Appellant 1- Penalties imposed under Section 112
(a) (i) & 114AA are upheld but reduced to 25% of the penalty imposed by the impugned order.
II. Appellant 2- Consolidated Penalty imposed under Section 112 (a) (i) & 114AA is upheld but reduced to 25% of the penalty imposed by the impugned order. Penalty separately imposed under Section 114AA is set aside.
III. Appellant 3 and Appellant 4 - Penalty imposed under Section 112 (a) (i) is set aside.
5.1 Appeals of Appellant 1 and Appellant 2 are partly allowed as indicated in para 4.14 above.
5.2 Appeals of Appellant 3 & Appellant 4 are allowed.
(Operative part of the order pronounced in open court) (P.K. CHOUDHARY) MEMBER (JUDICIAL) (SANJIV SRIVASTAVA) MEMBER (TECHNICAL) akp