Custom, Excise & Service Tax Tribunal
Shri Virender Bansal vs Cc (Icd), New Delhi on 7 January, 2015
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
Date of Hearing : 7.1.2015
Appeal No. C/232/2009, C/379-380/2009 &
C/390/2009-CU(DB)
[Arising out of Order-in-Original No. 19/2009 dated 5.3.2009 passed by the Commissioner of Customs, ICD, Tuglakabad, New Delhi]
For Approval & Signature :
Honble Mr. Ashok Jindal, Member (Judicial)
Honble Mr. R.K. Singh, Member (Technical)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2.
Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3.
Whether their Lordships wish to see the fair copy of the order?
4.
Whether order is to be circulated to the Department Authorities?
Shri Virender Bansal Appellant
Shri Deepak Jain, Employee
Shri Joginder Singh Bhandari, Prop.
Shri Davinder Kumar Sharma
Vs.
CC (ICD), New Delhi Respondent
Appearance:
Shri Krishna Kant, Advocate - for the Appellant
Ms. Suchitra Sharma, A.R. - for the Respondent
Coram : Honble Mr. Ashok Jindal, Member (Judicial)
Honble Mr. R.K. Singh, Member (Technical)
F. Order No.50073-50076/2015
Per Ashok Jindal :
The appellants viz. Shri Vinod Kumar Bansal, Shri Deepak Jain, Shri Joginder Singh Bhandari and Shri Davinder Kumar Sharma are in appeals before us against the impugned order wherein penalty on all the appellants have been imposed of Rs.25 lakhs, 20 lakhs, 20 lakhs and 20 lakhs respectively under Section 112 of the Customs Act, 1962.
2. The facts of the case are that Shri Vinod Kr. Bansal who used the DEPB scrips for free importation of goods which were required to be exported after manufacturing but the imported goods were diverted into local market after importation. DRI booked a case and matter was investigated, it was found that all these goods were purchased by Shri Vinod Kumar Garg and the imports made through Shri Vinod Kumar Bansal in the name of M/s Dollar Poly Pipes (India) Ltd. and M/s Shivalik Plastichem (India) Ltd. After investigation, it is revealed that the appellants were involved in the illegal imports of the goods which were diverted into domestic market without payment of duty. Therefore demand of duty against M/s Dollar Poly Pipes and M/s Shivalik Plastichem (I) Ltd. were proposed to be demanded along with interest and penalties were also proposed to be imposed. Before adjudication took place Shri Vinod Kumar Garg on behalf of the imports made through ICD, TKD went before the Settlement Commissioner and settled the issue there vide Order No. F-704/Cus/07-SC dated 20.12.2007 and F-791/Cus/08-SC(PB) dated 28.8.2008. Thereafter, adjudication took place with regard to imports made through Mumbai Customs and Show Cause Notices were issued to M/s Dollar Poly Pipes, its Chairman, Managing Director Shri Vinod Kumar Bansal and Shri Vijender Kumar Anjan to demand of duty along with interest and imposition of penalties under Sections 112(a) and (b) and Section 114(a) of the Customs Act, 1962. The matter was adjudicated as the imports made through ICD, TKD were settled before the Settlement Commission. Therefore no duty is demanded in the adjudication order for those imports but duty was demanded for imports made through Mumbai Customs and demand of duty of Rs.7,82,711/- was confirmed against M/s Dollar Poly Pipes (India) Ltd. along with interest and penalties on all the appellants along with other noticees were imposed. As no other person filed appeals before this Tribunal but appellants have filed appeal and seeking setting aside the penalty imposed on them.
3. The ld. Counsels appearing on behalf of the appellants submits that in this case imports have been made through ICD, TKD and Mumbai port. The imports made through ICD, TKD has been settled by the Settlement Commission vide order mentioned herein above. Therefore the penalties on the appellants qua imports through ICD, TKD is not imposable as held by the Tribunal in the case of S.K. Colombowala Vs. CC (Import), Mumbai 2007 (220) ELT 492 (Tri.-Mumbai).
4. For imports made from Mumbai port, it is the contention of the ld. Counsels that appellants before us were not the party to the Show Cause Notice. Therefore penalties on the appellants are not imposable. In these circumstances, it is prayed that the impugned order qua imposing penalty on all the appellants be set aside.
5. On the other hand, ld. Commissioner (AR) oppose the contention of the ld. Counsels and submits that it is a case of fraud played by Shri Vinod Kumar Bansal and Shri Vinod Kumar Garg and appellants were actively involved in the case of diversion of goods imported duty free in domestic market and from the statement recorded during the course of investigation and as well as with the support of the documentary evidences the adjudicating authority has rightly imposed the penalty on the appellants. Therefore the appellants are required to be penalised. She further submits that the facts of this case are not similar to the facts of the case in S.K. Colombowala (supra) as in this case Shri Bansal has already approached to the Settlement Commission for settlement of the penalty and which has been rejected by the Settlement Commissioner on account of suppression of facts.
6. Heard the parties and considered the submissions.
7. We find that in this case the imports has been made duty free and the goods have been diverted into domestic market which were not required so by the importer. Therefore, it is an admitted case of fraud played by the importers. But we find in this case for the imports made from through ICD, TKD the purchasers of the imported gods approached to the Settlement Commission and settled the case there. We also find that Shri Virender Bansal the appellant also approached to the Settlement Commission but the Settlement Commission passed the following order for the reasons given above the Bench in exercise of Commissions powers under Section 127-I of the Act sends the case with regard to the applicant Shri Virender Bansal back to the proper officer who shall dispose of the same in accordance with the provisions of the Act as if no application under Section 127B of the Act had been made by the said applicant. As the observation of the Settlement Commission is that Shri Bansal had no way approached the Settlement Commission. Therefore the case of Shri Bansal is equated with the other appellants before us.
8. We find that in this case S.K. Colombowala (supra) this Tribunal has held that if the case has been settled before the Settlement Commission, the proceedings against all the co noticees come to an end. Therefore, it was held that penalties not imposable under Section 112 of the Customs Act. In these circumstances, following the decision of S.K. Colombowala (supra) we hold that for the imports made through ICD, TKD the penalties on the appellants are not imposable.
9. With regards to imports made through Mumbai port paragraph 60 of the Show Cause Notice is relevant which is reproduced herein:
60 Now, therefore, M/s Dollar Poly Pipes (India) Ltd., 529, Sector -12, Panchkula and its Chairman-cum-Managing Directors namely Dharamvir Bansal S/o Shri Pyare Lal Bansal, resident of VPO: Dadahu, Tehsil Renuka, Distt. Sirmour (HP), Vinod Kumar Bansal, S/o Shri Harish Chander Bansal, R/o 1669, Urban Estate-II, Hisar (Haryana) and Vijender Kumar Anjan, S/o Shri Mool Chand, General Manager and Authorised Signatory, jointly and severally, are hereby called upon to show cause and explain to the Commissioner of Customs, (Export Promotion), Mumbai within 30 days from the receipt of this notice as to why:-
(a) The said goods, i.e. 40.00 MT of PVC Resin (assessable value Rs.13,77,236/-), as discussed at Sl. No. 5 of Table-8 above, imported through Mumbai seas port should not be held liable to confiscation under Section 111(d), 111(m) & 111(o) of the Customs Act, 1962 read with Customs Duty Exemption Notification No. 43/2002-Cus dated 19.4.2002, Rules 11, 13(2) & 14 of the Foreign Trade (Regulation) Rules, 1993 and para 4.1.2 of the Export Import Policy for year 2002-2007, para 4.16 & 4.30 of the Hand Book of Procedures for the year 2002-2007 to the reason as discussed in Para 56 to 58 above.
(b) Customs duty amounting to Rs.7,82,711/- (Rs. Seven lakhs eighty two thousands seven hundred eleven only), which was foregone at the time of import, should not be demanded and recovered from them under the proviso to Section 28 of Customs Act, 1962 read with Customs exemption Notification No. 43/2002-Cus dated 19.4.2002 due to the reason as discussed in para 56 to 58 above.
(c) Interest should not be recovered from the importer under Section 28AB of the Customs Act, 1962 read with Customs exemption Notification No. 43/2002-Cus dated 19.4.2002 due to the reason as discussed in para 56 to 58 above.
(d) Penalty should not be imposed on them under Section 112(a) & (b) and/or under Section 114A of the Customs Act, 1962 for above mentioned acts of omission and commission which have rendered the subject goods liable to confiscation under Section 111 of the Customs Act, 1962 due to the reason as discussed in para 56 to 58 above.
10. On going through the Show Cause Notice, we find that the appellants before us were not the parties to the imports made through Mumbai port. As the appellants were not the parties to the Show Cause Notice, therefore, the question of imposing penalty on the appellants do not arise.
11. In these circumstances, we hold that for the imports made through Mumbai port, the appellants are not to be penalised.
12. In the result, we hold that in this case penalties on all the appellants before us are not imposable. Therefore, impugned order qua imposing penalty on the appellants before us is set aside. Appeals are allowed in these terms with consequential relief (if any).
(Dictated & pronounced in Court).
(Ashok Jindal) Member (Judicial) (R.K. Singh) Member (Technical) RM 4