Custom, Excise & Service Tax Tribunal
Kool International vs Commissioner Of Customs,New Delhi New ... on 12 December, 2025
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI.
PRINCIPAL BENCH,
COURT NO. I
CUSTOMS APPEAL NO. 186 OF 2012
[Arising out of the Order-in-Original No. 05/2012 dated 31/01/2012 passed
by The Commissioner of Customs, New Delhi.]
M/s Kool International, ......Appellant
1516-18, Shop No. 12, Pataudi House Road,
Daryaganj, New Delhi - 110 002.
Versus
Commissioner of Customs, ....Respondent
Inland Container Depot, Tughlakabad,
New Delhi.
WITH
CUSTOMS APPEAL NO. 187 OF 2012
[Arising out of the Order-in-Original No. 05/2012 dated 31/01/2012 passed
by The Commissioner of Customs, New Delhi.]
Shri Vikas Bothra, Proprietor of ......Appellant
M/s Kool International,
1516-18, Shop No. 12, Pataudi House Road,
Daryaganj, New Delhi - 110 002.
Versus
Commissioner of Customs, ....Respondent
Inland Container Depot, Tughlakabad,
New Delhi.
APPEARANCE:
Shri Amar Kumar Sinha, Advocate for the appellants.
Shri Girijesh Kumar, Authorized Representative for the
Department
AND
CUSTOMS APPEAL NO. 143 OF 2012
[Arising out of the Order-in-Original No. 05/2012 dated 31/01/2012 passed
by The Commissioner of Customs, New Delhi.]
Shri Surendra Kumar, ......Appellant
Flat No. 32, Popular Apartments,
Sector - 13, Rohini,
New Delhi - 110 085.
Versus
Commissioner of Customs, ....Respondent
Inland Container Depot, Tughlakabad,
New Delhi.
2 C/186 OF 2012 & 2 others
APPEARANCE:
Shri Abhas Mishra, Advocate for the appellant.
Shri Girijesh Kumar, Authorized Representative for the
Department
CORAM:
HON'BLE JUSTICE MR. DILIP GUPTA, PRESIDENT
HON'BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)
FINAL ORDER NO's. 51871-51873/2025
DATE OF HEARING : 18.07.2025
DATE OF DECISION: 12.12.2025
P.V. SUBBA RAO
The Order dated 31.01.20121 passed by the
Commissioner of Customs, Inland Container Depot,
Tughlakabad, New Delhi2 is assailed in these three appeals by:
(a) M/s. Kool International on which a penalty of Rs.
10,00,000/- was imposed under section 112(b) of the
Customs Act, 19623;
(b) Shri Vikas Bothra, proprietor of Kool International on
whom a penalty of Rs. 10,00,000/- was imposed
under section 112(b) of the Act; and
(c) Shri Surendra Kumar on whom a penalty of Rs.
10,00,000/- was imposed under section 112(b) of the
Act;
2. The impugned order confiscated goods and imposed
penalties but the appeal memoranda makes it explicit that the
appellants are contesting only the penalties imposed on them.
Of the confiscated goods, goods worth Rs. 10,27,680/- which
were imported in the name of Kool International were
1. impugned order
2. Commissioner
3. the Act
3 C/186 OF 2012 & 2 others
confiscated and an option was given to Kool International to
redeem them on paying a fine of Rs. 4,00,000/-.
3. In addition, goods worth Rs. 1,12,37,600/- imported in
the name of DSA Imports & Exports and goods worth
Rs.1,00,75,100/- imported in the name of Prakriti Collection
were absolutely confiscated since it was found during
investigation that these firms did not exist at all. The
impugned order does not indicate that any representation was
made on behalf of either of these firms. There is also no
appeal by either of these firms before us. The Commissioner
also did not impose any penalty on these two firms as they did
not exist.
4. The operative part of the impugned order is reproduced
below:
(i) the seized goods mentioned in Annexure - A1 to this
order collectively valued at Rs. 10,27,680/- (market
value) having assessable value of Rs. 4,11,072/-
(being 40% of market value) involving total duty of
Rs. 1,10,371/- as found in the two containers and
imported under two Bills of Lading No. APLU
052646094 and APLU 052646331 pertaining to M/s
Kool International. These goods have been used for
concealing mis-declared goods of different Bill of
Lading of different importer and hence are
confiscated under Section 111 (i), (l) & (m) read with
section 119 of the Customs Act, 1962. However, M/s
Kool International are given an option to redeem the
same on payment of Redemption Fine of Rs.
4,00,000/- (Rupees four lac only) besides payment of
applicable duties. The goods have to be redeemed
within a period of 30 days from the date of this
order;
(ii) the seized goods mentioned in Annexure - A1 to this
order collectively valued at Rs. 1,00,75,100/-
(market value) having assessable value of Rs.
4 C/186 OF 2012 & 2 others
40,30,040/- (being 40% of market value) involving
duty of Rs. 49,11,424/- found in the container No.
APHU 6669350 and imported under Bill of Lading No.
APLU 052800261 pertaining to M/s Prakriti Collection,
Plot No. 20, Block A, Raghu Nagar, New Delhi are
confiscated under section 111 (d), (i) (l) & (m) of the
Customs Act, 1962. Since M/s Prakriti Collection is a
non-existent firm, the confiscation is made absolute;
(iii) the seized goods mentioned in Annexure - A1 to this
order collectively valued at Rs. 1,12,37,600/-
(market value) having assessable value of Rs.
44,95,040/- (being 40% of market value) involving
duty of Rs. 47,85,715/- as found in the container No.
CRXU 9901651 and imported under Bill of Lading No.
APLU 052800182 dated 25.08.2009 pertaining to M/s
DSA Import & Export, 33, H-Block, Gali No. 7, Raghu
Nagar New Delhi - 59 are confiscated under section
111 (d), (i) (l) & (m) of the Customs Act, 1962. Since
M/s DSA Import & Export is a non-existent firm, the
confiscation is made absolute;
(iv) Penalty of Rs. 10,00,000/- (Rupees ten lacs only) is
imposed on M/s Kool International under section 112
(b) of the Customs Act, 1962 for their acts &
omission and commission and abetting smuggling of
goods wilful suppression of facts rendering the seized
goods liable to confiscation under section 111 (i), (l)
& (m) of the Customs Act, 1962 ;
(v) penalty of Rs. 10,00,000/- (Rupees ten lacs only) is
imposed on Shri Vikash Bothra, Proprietor of M/s Kool
International under section 112 (b) of the Customs
Act, 1962 for his acts of omission & commission and
abetting smuggling of the goods & wilful suppression
of facts rendering the seized goods liable to
confiscation under section 111 (d), (i) (l) & (m) of the
Customs Act, 1962 and for evasion of duty of Rs.
1,10,371/- as per details given in Annexure A1 to this
order ;
(vi) penalty of Rs. 10,00,000/- (Rupees ten lacs only) is
imposed on Shri Surender Kumar, r/o Flat No. 32,
Popular Apartment, Sector 13, Rohini, New Delhi
under section 112 (b) of the Customs Act, 1962 for
his acts of omission & commission in importing goods
by using IEC number of different importer and
abetting smuggling of the goods & wilful suppression
of facts rendering the seized goods liable to
confiscation under section 111 (d), (i) (l) & (m) of the
Customs Act, 1962 ;
5 C/186 OF 2012 & 2 others
(vii) even though penalty is imposable on M/s DSA
Imports & Exports, No. 33, H-Block, Gali No. 7,
Raghu Nagar, New Delhi - 59 under section 112 (b)
of the Customs Act, 1962 for their acts of omission &
commission and abetting smuggling of goods & wilful
suppression of facts rendering the seized goods liable
to confiscation under section 111 (d), (i) (l) & (m) of
the Customs Act, 1962 and for evasion of duty of Rs.
47,85,715/- as per details in Annexure A1 to this
order, the same is not imposed now as the firm
appears to be a non-existent firm and the concerned
persons are not traceable. I direct the S.I.I.B., ICD,
TKD, New Delhi to locate the persons for imposition
of penalty on them as per law ;
(viii) even though penalty is imposable on M/s Prakriti
Collection, Plot No. 20, A Block, Raghu Nagar, New
Delhi under section 112 (b) of the Customs Act, 1962
for their acts of omission & commission and abetting
smuggling of goods & wilful suppression of facts
rendering the seized goods liable to confiscation
under section 111 (d), (i) (l) & (m) of the Customs
Act, 1962 and for evasion of duty of Rs. 49,11,424/-
as per details in Annexure A1 to this order, the same
is not imposed now as the firm appears to be a non-
existent firm and concerned persons are not
traceable. I direct the S.I.I.B., ICD, TKD, New Delhi
to locate the persons for imposition of penalty on
them as per law ;
5. The facts which led to the issue of the impugned order
are that Shri Vikas Bothra of Kool International holds Importer
Exporter Code4 0505058961. He received a message from
Shipping Line APL that some goods were received at the ICD
and asking him to clear them. Since he had not ordered any
goods at all, he sent a letter dated 16.9.2009 to the Additional
Commissioner of Customs stating that he never imported the
goods said to have been imported and they did not belong to
him and as such, he was not responsible for any claims
whatsoever.
4. IEC
6 C/186 OF 2012 & 2 others
6. Later, he sent another letter 12.10.2009 to the
Additional Commissioner asking him to NOT take cognizance of
his earlier letter because he had entered into an agreement
with Shri Surendra Kumar to allow Surendra Kumar to import
goods using his (Bothra's) IEC. It was stated that the two
consignments had been imported by Surendra Kumar without
his knowledge. He also said that Surendra Kumar agreed to
pay all types of government liabilities and penalties, if any.
7. At this stage, it must be pointed out that nobody can
import or export any goods without an IEC issued by the
DGFT. Section 7 of the Foreign Trade (Development &
Regulation) Act, 19925 reads as follows:
Section 7: Importer-exporter Code Number.
No person shall make any import or export except
under an Importer-exporter Code Number granted
by the Director General or the officer authorised by
the Director General in this behalf, in accordance with
the procedure specified in this behalf by the Director
General:
Provided that in case of import or export of services or
technology, the Importer-exporter Code Number shall be
necessary only when the service or technology provider
is taking benefits under the foreign trade policy or is
dealing with specified services or specified technologies.
8. There is no provision either the FTDR Act or any other
law to transfer, lend, lease one's IEC to anyone else or to allow
one person to import goods using the IEC of somebody else.
5. FTDR Act
7 C/186 OF 2012 & 2 others
This provision is well-known to anyone dealing with imports
and exports.
9. The matter was investigated further and both Shri Vikas
Bothra, the proprietor of Kool International who allowed his
IEC to be used by Shri Surendra Kumar and Shri Surendra
Kumar who had used the IEC of Kool International confirmed
this arrangement between them.
10. Investigation revealed that in the same two containers in
which the goods were imported in the name of Kool
International, there were other goods imported in the names
of two other firms DSA Import & Export in whose name
footwear were imported and Prakriti Collection in whose name
cotton towels were declared to have been imported. On
examination, the goods were found to be completely different
in these two consignments. Investigations showed that neither
of these firms actually existed.
11. After recording statements of various persons and
completing the investigation show cause notice dated
4.4.20116 was issued to Shri Vikas Bothra, Proprietor of Kool
International, Shri Surendra Kumar and to M/s. DSA Import &
Export and M/s. Prakriti Collection. The proposals in this SCN
were decided in the impugned order.
Submissions on behalf of Kool International and Shri
Vikas Bothra
6. SCN
8 C/186 OF 2012 & 2 others
12. Shri Amar Kumar Sinha, Learned counsel for Kool
International and Shri Vikas Bothra made the following
submissions:
(i) Shri Vikash Bothra had no personal knowledge nor
any personal involvement or gain out of the alleged
offence. He had not filed any Bill of Entry and
therefore, the goods cannot be confiscated under
section 111(d) (i) (l) and (m) of the Act. Reliance is
placed on Commissioner of Customs & Excise,
Goa versus Kabul Textiles (LLC)7.
(ii) The allegation of violation of Intellectual Property
Rights (Imported Goods) Enforcement Rules, 2007 is
not correct because the rights owners did not
participate. [This appears to refer to the branded
goods found in the two consignments imported in the
name of DSR Import and Exports and Prakriti
Collections].
(iii) Penalty has been imposed on Kool International on
the ground that acts and omissions on its part
rendered the goods liable to confiscation and penalty
imposed on Shri Vikas Bothra alleged that his acts
and omissions had rendered the goods liable to
confiscation which shows non application of mind by
the Commissioner.
(iv) In case of Less Container Load (LCL) cargo, the same
container can have consignments of different parties.
The aggregator books consignments of several
persons and stuffs them into a single container and
exports the container through the shipping line. In
such a case, one importer cannot be held responsible
for any discrepancy found in the consignment of
another importer.
7. 2006 (206) ELT 1173 (Bom.)
9 C/186 OF 2012 & 2 others
(v) The Commissioner also held that penalty is imposable
on DSR Import and Export and Prakriti Collection
although he did not impose it. This shows that the
Commissioner found those two firms responsible for
the discrepancies in their imports. Penalty cannot be
imposed on the appellant also who is a different
entity and who has nothing to do with the imports in
the names of the other two firms.
(vi) Simultaneous penalty on both Shri Bothra and his
proprietorship firm Kool International is not
sustainable.
(vii) The statements recorded under section 108 of the Act
were not put through the procedure under section
138B of the Act and hence they should not have been
relied upon.
(viii) No role was played by Shri Vikas Bothra in the
imports.
(ix) Since no Bill of Entry has been filed, no penalty is
imposable under section 112.
Submissions on behalf of Shri Surendra Kumar
13. Shri Abhas Mishra, learned counsel for Shri Surendra
Kumar made the following submissions:
(i) No effort was made to investigate the true importers
M/s. DSA Import & Exports and M/s. Prakriti
Collections or their owners.
(ii) Statements of Shri Bothra were vague and were not
put through the procedure under section 138B of the
Act and therefore, cannot be used as evidence.
(iii) There has been a violation of the principles of natural
justice.
(iv) It is for the department to prove the guilty of the
appellant and not the other way round.
(v) The penalty imposed on Shri Surendra Kumar is
disproportionate to the value of the goods confiscated
which belonged to M/s. Kool International.
Submissions on behalf of Revenue
10 C/186 OF 2012 & 2 others
14. Shri Girijesh Kumar, learned authorised representative
for the Revenue vehemently supported the impugned order
made the following submissions.
(i) The goods were deliberately concealed and mis-
declared in different Bills of Lading including in the
name of two non-existent firms.
(ii) M/s. DSA Import & Export and M/s. Prakriti Collection
were found to be completely fraudulent, non-
existent, with fake PAN and false addresses.
(iii) The statements of Shri Bothra and Shri Surender
Kumar indicated a pattern of deception and collusion.
(iv) There was mis-declaration as well as violation of IPR
laws.
(v) The department does not have to establish its case
with mathematical precision.
(vi) The penalties imposed on the appellants are fair and
proper and call for no interference.
Findings
15. We have considered the submissions advanced by the
learned counsels and the learned authorised representative for
the Revenue and perused the records. The appeals assail the
penalty of Rs. 10,00,000/- each imposed on M/s. Kool
International, Shri Bothra and Shri Surendra Kumar under
section 112.
16. These penalties were imposed by the Commissioner in
the impugned order for acts of omissions which rendered the
following goods liable to confiscation:
S.No. Container no. / Bill Importer Market value Confiscated
of Lading no. (Rs.) under sections
1 APLU 052646094 Kool International 10,27,680 111(i), (l) & (m)
APLU 052646331
2 APLU 052800261 Prakriti Creations 1,00,75,100 111(d), (i), (l) &
(m)
3 APLU 052800182 DSA Import & 1,12,37,600 111(d), (i), (l) &
Export (m)
11 C/186 OF 2012 & 2 others
17. So far as the goods at S. No. 2 &3 are concerned, the
appellants never claimed that the consignments belonged to
them. There is also no evidence that although the goods were
imported in the name of Prakriti Creations and DSA Import &
Export, they actually belonged to the appellants. Both Prakriti
and DSA were found to be non-existent. Nobody joined the
investigation nor made any representations before the
Commissioner or filed any appeals on their behalf. The
Commissioner, however, imposed penalties on the appellant
considering these two consignments for the reason that they
were found in the same container. Such decision of the
Commissioner cannot be sustained. When goods are imported,
one may import a full container load (FCL) or less than full
container load (LCL). In case of LCL cargo, goods belonging to
two or more importers is stuffed in the same container. Such a
container is akin to a shared taxi or a bus. If one is in a shared
taxi or a bus, he will be responsible for what he is carrying on
his person or in his luggage but will NOT be responsible if a
fellow passenger carries contraband on his person or in his
luggage. Likewise, if there are violations in the consignment of
some other importer was also stuffed in the same container,
the appellants cannot be held responsible or penalised under
section 112 for acts or omissions related to such
consignments.
12 C/186 OF 2012 & 2 others
18. Insofar as the consignment at S. No. 1 is concerned, it
was confiscated under sections 111 (i), (l) and (m) read with
section 119 of the Act. These sections read as follows:
Section 111. Confiscation of improperly imported
goods, etc. -
The following goods brought from a place outside India
shall be liable to confiscation: -
(a) ******
(i) any dutiable or prohibited goods found concealed in
any manner in any package either before or after the
unloading thereof;
*****
(l) any dutiable or prohibited goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under section 77 ;
(m) any goods which do not correspond in respect of value or in any other particular with the entry made under this Act or in the case of baggage with the declaration made under section 77 in respect thereof, or in the case of goods under trans-shipment, with the declaration for trans-shipment referred to in the proviso to sub-section (1) of section 54 ;
Section 119. Confiscation of goods used for concealing smuggled goods. -
Any goods used for concealing smuggled goods shall also be liable to confiscation.
Explanation : In this section, "goods" does not include a conveyance used as a means of transport.
19. Sections 111(l) and (m) apply to goods which do not correspond to the entry made under the Act. The 'entry is made' under the Act by filing a Bill of Entry. In this case, no Bill of Entry was filed at all. It is said that no Bill of Entry was filed for the reason that the IEC of Kool International was suspended by the DGFT; therefore, the question of not matching with the entry made does not arise.
13 C/186 OF 2012 & 2 others
20. Section 111(i) renders 'any dutiable or prohibited goods found concealed in any manner in any package either before or after the unloading thereof' liable to confiscation. This clause is not related to filing of any Bill of Entry. Goods were imported under two Bills of Lading in the name of Kool International. In Bill of Lading No. APLU 52646331, the goods declared were cotton towels and on examination, small cotton towels were found. Evidently, small cotton towels also fall under the description cotton towels. There is no discrepancy in this Bill of Lading. In Bill of Lading APLU 052646094, the goods were described as Footwear and they were found to be Baby shoes (unbranded) and baby shoes (branded). It cannot be anyone's case that baby shoes are not footwear.
21. Undisputedly, the position of Mr. Bothra from the letters which he had sent to the Additional Commissioner up to the submissions before us, is that although the goods were imported in the name of Kool International, they actually belonged to Shri Surendra Kumar and that he had lent his IEC to Shri Surendra Kumar for the purpose. Section 7 of the FTDR Act prohibits any imports without an IEC. 'Any goods which are imported or attempted to be imported or are brought within the Indian customs waters for the purpose of being imported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force' are liable to confiscation under section 111(d) of the Act.
14 C/186 OF 2012 & 2 others However, the Commissioner did not confiscate these goods under section 111(d) of the Act although he did so with respect to the other consignments belonging to DSA Import & Export and Prakriti Collections.
22. The Commissioner also invoked section 119 which provides for confiscation of the goods used to conceal other goods. In this case, the goods imported in the name of Kool International were separate and distinct and they were not used to conceal any other goods. Therefore, section 119 will not apply.
23. Consequently, confiscation of the goods imported in the name of M/s. Kool International cannot be sustained. Consequently, the penalties imposed on the appellant cannot be sustained.
24. The impugned order is set aside insofar as it confiscates the goods imported in the name of Kool International and imposes penalties on M/s. Kool International, Shri Bothra and Shri Surendra Kumar. All three appeals are accordingly, allowed.
(Order pronounced in open court on 12/12/2025.) (JUSTICE DILIP GUPTA) PRESIDENT (P.V. SUBBA RAO) MEMBER (TECHNICAL) PK