Custom, Excise & Service Tax Tribunal
Wall Street Finance Ltd vs Cc (Airport) on 2 April, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI
COURT NO. II
APPEAL NO. C/1065, 1123/06 Mum
(Arising out of Order-in-Original No. COMMR/PVR/ADJN/01/2006 dated 28.04.2006/3.7.06 passed by the Commissioner of Customs, CSI Airport)
For approval and signature:
Honble Shri Ashok Jindal, Member (Judicial)
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Yes
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
Wall Street Finance Ltd.
Rose Travels
:
Appellant
Versus
CC (Airport),
Mumbai
Respondent
Appearance Shri Sushanth Murthy, Advocate Shri Anil Balani, Advocate For appellants Shri Devendra Nagvenkar, Addl. Comm (A.R.) For Respondents CORAM:
Shri Ashok Jindal, Member (Judicial) Date of Hearing : 02.04.2014 Date of Decision : 02.04.2014 ORDER NO.
Per Ashok Jindal The appellants are in appeals against the impugned order imposing penalty of Rs.50,000/- under Section 114(i) of the Customs Act, 1962.
2. As the issue involved in both the appeals is common therefore, both the appeals are taken up together for consideration and disposal.
3. Brief facts of the case are that the appellants are Money Exchangers. On 21.09.1997, a person namely Shri Essack Farid Shaikh was intercepted and travelers cheques, foreign currencies etc. were recovered. An investigation was conducted. During the course of investigation, it was revealed that the appellant (Rose Travels) issued travelers cheques of US $ 3,000/- each to four persons which were found in the custody of the person namely Shri Essack Farid Shaikh on 21.09.1997and travelers cheque of US $ 500/- was issued by M/s. Wall Street Finance Ltd.. Therefore, notices were issued to the appellants to show cause why penalty should not be imposed on them for aiding and abideing for smuggling of foreign currency. Later-on an addendum was issued which was replied and thereafter penalties were imposed on the appellants. Aggrieved by the same, the appellants are before me.
4. Shri Anil Balani, learned Advocate appearing for M/s Rose Travels submits that the appellant has issued travelers cheques worth of US $ 3000/- to four persons after duly verified the particulars of the persons to whom the travelers cheques were issued andd obtained copy of passport and application form for issue of travelers cheques and they have supplied these documents during the course of investigation. Therefore, if these travelers cheques have been recovered from a third party the same is not in the knowledge of the appellants therefore, the penalty cannot be imposed. He further submits that as details given in the passport of these persons have not been contraverted by the department. In that case also it cannot be held that these persons are fake. He further submits that in the statement of one of the passport holder who had denied that they have not taken travelers cheques from the appellants is without any documentary evidence as the appellant had issued travelers cheques after obtaining copy of the passport and application. But the applicant failed to show how the passport was produced for issue of travelers cheques. No report of misplace of passport is on record. In these circumstances merely stating that they have stated that they have not received the travelers cheques from the appellant is not sustainable. Therefore, the penalty on the appellant is not sustainable.
5. Shri Sushanth Murthy, learned Advocate appearing for the M/s Wall Street Finance Ltd. submits that they have issued these travelers cheques in the year 1995. At that time guidelines issued by RBI are not applicable. Therefore, they did not obtain any copy of the application from the applicant. Moreover, the recovery after a period of 2= years and from the third party does not implicate that the appellant in the offence of aiding and abeting for smuggling of the foreign currency. He relied on the decision of the Tribunal in the case of Trade Wings Ltd. v. CC 2009 (243) ELT 439 (Tri. Mumbai) to support his contention that the lack of care and diligence shown by the appellant in performing the duty cannot a reason to charge them with aiding and abeting in smuggling of foreign currency.
6. The learned A.R. opposes the contention of the learned Advocates and submits that in this case the travelers cheques issued by M/s Wall Street Finance Ltd. without observing the RBI guidelines. In this case the applicant was not sent by the person to whom the travelers cheques issued therefore they were involved in the smuggling of foreign currency by aiding and abeting.
7. Considered the submissions and perused the records.
8. In the case of M/s Wall Street Finance Ltd. the guidelines of RBI were not issued during the relevant time therefore, in that case the contention of the learned A.R. that for travelers cheques were issued without the issue of application and passport is not sustainable as there is no guidelines during the impugned period. Further, I find that as the statement shows that this travelers cheques were issued to the broker/agent to whom he has handed over his passport. When the appellant had issued currency after verifying the particulars of the passport. Therefore, it cannot be denied that this traveler cheques has not been issued in the name of the persons who is denying the statement and I also find that in this case the currency have been detected after 2= years of issuance of travelers cheques which has passed various hands before the interception. In these circumstances, I hold merely on the ground that the appellant was not due diligence at the time of issuance of the travelers cheqes which may be used in smuggling of foreign currency, the allegation is not sustainable. Therefore, following the decision of the Trade Wings Ltd. (supra), I set aside the penalty imposed on the appellants.
8.1 With regard to the penalty imposed on M/s Rose Travels, I find that the appellant has produced the application form and passport of the persons to whom the travelers cheques were issued. The Revenues contention is that two of the addresses are not available but these addresses are available in the passports and the passport is an authenticate document to ascertain the postal address of a person. In fact the address of a person is to be verified by the concerned police station. In these circumstances, the allegation of aiding and abetting smuggling of travelers cheques is not sustainable merely saying that the persons are not available on the given address in the absence of any cogent evidence that these passports are fake. Further, in one of the case it is no doubt the travelers cheque has been issued in the name of the passport holder, in the show-cause notice there is no allegation that the signature of the said person is not the same as in the application and the in the passport. Further, no statement of such person has been placed on record. In these circumstances, merely saying that he is not the same person cannot be the ground for the allegation in show-cause notice. In these circumstances, I hold that the penalty on M/s Rose Travels is not imposable.
9. In nutshell penalties on both the appellants are set aside and the Appeals are allowed.
(Dictated in Court) (Ashok Jindal) Member (Judicial) nsk ??
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