Custom, Excise & Service Tax Tribunal
) M/S.New Modern Medico vs Commissioner Of Customs, Patna on 2 May, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL, KOLKATA
EASTERN ZONAL BENCH: KOLKATA
1-2) Appeal Nos.CA-75383-75384/14
(Arising out of Order-in-Appeal No.499-501/Pat/Cus/Appeal/2013 dated 18.12.2013 passed by the Commissioner(Appeals) of Customs, Central Excise & Service Tax, Patna.)
FOR APPROVAL AND SIGNATURE
HONBLE SHRI H.K.THAKUR, MEMBER(TECHNICAL)
1. Whether Press Reporters may be allowed to see
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
CESTAT(Procedure) Rules, 1982 for publication in any
Authorative report or not?
3. Whether Their Lordship wishes to see the fair copy
of the Order?
4. Whether Order is to be circulated to the Departmental
Authorities?
1) M/s.New Modern Medico
2) M/s.Rajendra Kumar & Co.
Applicant (s)/Appellant (s)
Vs.
Commissioner of Customs, Patna
Respondent (s)
Appearance:
Shri R.N.Bandyopadhyay, Consultant for the Appellant (s) Shri S.N.Mitra, AC(AR) for the Revenue (s) CORAM:
Honble Shri H.K.Thakur, Member(Technical) Date of Hearing/Decision :- 02.05.2016 Date of Pronouncement :- 02.05.2016 ORDER NO.FO/A/75325-75326/2016 Per Shri H.K.Thakur.
These Appeals have been filed by the Appellants against Order-in-Appeal No.499-501/Pat/Cus/Appeal/2013 dated 18.12.2013 passed by the Commissioner(Appeals) of Customs, Central Excise & Service Tax, Patna as First Appellate Authority. Under this Order-in-Appeal dated 18.12.2013 First Appellate Authority has upheld penalty of Rs.90,000/-(Rupees Ninety Thousand only) and Rs.95,000/-(Rupees Ninety Five Thousand only) imposed by the Adjudicating authority respectively upon Appellant M/s.Rajendra Kumar & Co. and M/s.New Modern Medico, Muzaffarpur.
2. Shri R.N.Bandyopadhyay (Consultant) appearing on behalf of the Appellants argued that on the basis of a specific information on 03.04.2012 by DRI, a consignment of Phensedyl Cough Linctus, was found concealed under the bags of broken rice when a truck was intercepted by the DRI Officers of Muzaffarpur on National Highway 77. That on interception the driver of the truck having Registration No.AS-01AC/3506 handed over hand-written invoice dated 03.04.2012 and GRNo.717 dated 03.04.2012 issued by M/s.Sharma Enterprises, Patna and M/s.Rahul Roadways, Patna respectively. That Shri Kaushik Deb, driver of the intercepted truck in his statement dated 04.04.2012 never confessed that Phensedyl Cough Linctus is meant to be exported out of India through Indo-Bangladesh border. That there is no other corroborative evidence indicating that the seized goods were destined for Bangladesh. Ld.Consultant further argued that First Appellate Authority has not given his individual findings regarding imposition of penalties upon his clients but has only reproduced the findings given by the Adjudicating authority in Para 4.06 of Order-in-Original dated 31.03.2013.
3. Shri S.N.Mitra, AC(AR) appearing on behalf of the Revenue argued that Phensedyl Cough Linctus is a specified item under the Customs Act, 1962 which was required to be purchased and sold under proper invoices and certain statutory records were required to be maintained as per the provisions of Drugs & Cosmetics Act. That Appellants generated fake vouchers/invoices in the name of fictitious persons to cover the seized goods. Ld.AR thus strongly defended the order passed by the First Appellate Authority.
4. Heard both sides and perused the case records. Penalties have been imposed upon the Appellants with respect to seized goods under Section 114 of the Customs Act, 1962 which according to the Revenue were meant for export to Bangladesh. However, it is observed from the statement of the driver of the intercepted truck that nowhere it is stated that the seized goods were being taken out of the country to Bangladesh. It is observed from the case records that a consignment of Phensedyl Cough Linctus was found concealed in a truck under bags of broken rice. It is also observed that certain procedures were required to be followed during the movement of Phensedyl Cough Linctus under the Drugs & Cosmetics Act, as it contains Salts of Codein a narcotic substance. The method of concealment and preparation of fake vouchers/invoices no doubt creates suspicion regarding illegal activities being undertaken by the Appellants. However, there is nothing on record that these activities suggest that the Phensedyl Cough Linctus was meant for export to Bangladesh. The manner of concealment and documentations could also be adopted to overcome the restrictions imposed under the Drugs & Cosmetics Act during movements within India. For violation of any of the procedures prescribed under the Drugs & Cosmetics Act a person could be punished under the relevant provisions of Drugs & Cosmetics Act but these violations cannot be made as the basis for taking action under the Customs Act, 1962. It is also observed by the Adjudicating authority, as reproduced by First Appellate Authority in para 9 of Order-in-Appeal dated 18.12.2013, that Phensedyl Cough Linctus is a specified good under section 11-I of the Customs Act, 1962. As per Notification No.31/2008-CUS(NT) dated 25.03.2008, an area of 50 kms. in width from the land border with Bangladesh is treated as a specified area. On a specific query from the Bench, the Ld.AR could not explain as at which stage the goods under seizure were within 50 kms. distance from the land border with Bangladesh. In the absence of any documentary evidence, suggesting that seized goods were meant for export to Bangladesh, it cannot be held that the Appellants can be visited with penalties under Section 114 of the Customs Act, 1962. Accordingly Appeals filed by the Appellants are required to be allowed.
5. Appeals filed by the Appellants are allowed with consequential relief, if any.
(Operative part of the order was pronounced in the open court.)
SD/
(H.K.THAKUR) MEMBER(TECHNICAL)
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Appeal No.CA-75383-75384/14