Custom, Excise & Service Tax Tribunal
Nikasu Packs Pvt. Ltd vs Commissioner Of Customs Cochin on 27 June, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: C/2499/2012-SM, C/2501/2012-SM [Arising out of Order-in-Appeal No. 119/2012 dated 04/04/2012 passed by the Commissioner of Customs, Cochin] [Arising out of Order-in-Appeal No. 120/2012 dated 04/04/2012 passed by the Commissioner of Customs, Cochin] NIKASU PACKS PVT. LTD. PLOT NO.23, CSEZ, KAKKANAD, COCHIN 682 037 APPELLANT(S) NIKASU FROZEN FOODS INTERNATINAL PLOT NO.23, CSEZ, KAKKANAD, COCHIN 682 037 APPELLANT(S) Versus COMMISSIONER OF CUSTOMS COCHIN CUSTOM HOUSE COCHIN 682 009 KERALA RESPONDENT(S)
Appearance:
None Shri Parasivamurthy N.K., Deputy Commissioner (AR) For the Appellant For the Respondent Date of Hearing: 27/06/2017 Date of Decision: 27/06/2017 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order Nos. 20986 - 20987 / 2017 Per: S.S GARG Appellants have filed these two appeals against the two impugned orders dated 04.04.2012 passed by the Commissioner of Customs (Appeals). The issue involved in both the appeals is common and therefore, both the appeals are disposed of by this common order.
2. Briefly the facts of the present case are that on the basis of intelligence received by the officers of the Directorate of Revenue Intelligence to the effect that M/s. Nikasu Packs Pvt. Ltd. was effecting exports of non basmati rice and wheat atta which were items covered in the prohibited list for exports under ITC (HS) Classification of export and import items by mis-declaring these as rice powder, puttu podi, etc. and also misusing the self examination and self sealing facilities extended to SEZ Units. As the export of non basmati rice was prohibited for export vide Govt. of India, Ministry of Commerce Notification No. 38 (RE-2007)/2004-09 dated 15.10.2007 as amended, the matter was taken up with the Development Commissioner, CSEZ, Cochin and under prior intimation to him, the officers of DRI Unit visited the office premises of M/s. Nikasu Pack Pvt. Ltd. along with Customs officers of CSEZ on 17.03.2009 which also accommodate the office of their another sister concern in CSEZ viz., M/s. Nikasu Frozen Foods International.
2.1. M/s. Nikasu Forzen foods International, Plot No. 23B, CSEZ, Kakkanad, Kochi 682 037, Kerala with IE Code No. 3901000046 (hereinafter referred to as M/s. Nikasu Frozen) is a proprietorship company, engaged, inter alia, in the business of manufacture and export of Vegetable frozen foods and Coconut Shells. The Proprietor of this firm is Mrs. Subadra Amma, wife of Mr. K.K. Pillai. The CEO of this company is Mr. K.K. Pillai. This unit had been issued with letter of approval No. 9/04/99:CSEZ dated 18.10.2004 by the Development Commissioner of CSEZ for undertaking authorized operations, namely, manufacture and export of Vegetable, frozen foods and Coconut Shells. The MD of the firm, Shri K.K. Pillai, was asked to submit the export files of M/s. Nikasu Packs Pvt. Ltd. with respect to exports made to their Australian Buyers. He then submitted the following files:
a) Export file of M/s. Nikasu Packs Pvt. Ltd. for the period January 2008 to March 2009
b) Procurement file of M/s. Nikasu Packs Pvt. Ltd.
c) Correspondence files of their three Australian buyers viz., M/s. Agro Trade International Pvt. Ltd. M/s. Caprihans Australia Pty. Ltd., and M/s. FBC International Pty. Ltd.
2.2. Further on the basis of the documents seized during the search conducted at the office of the appellant and on the basis of the statement of the CEO as well as employees of the appellant recorded under Section 108 of the Customs Act 1962, a show-cause notice dated 10.03.2010 was issued to the appellant as well as its CEO and General Manager to show-cause as to why 77.989 MTS of non basmati rice valued at Rs. 36,92,517/- (Rupees Thirty Six Lakhs Ninety Two Thousand Five Hundred and Seventeen only) should not be held liable for confiscation under Section 113(d), (h) & (i) of the Customs Act, 1962 and why penalty should not be imposed on them under Section 114(i) and 114(AA) of the Customs Act on the allegation that appellants had exported non Basmati Rice in contravention of the provisions of the Foreign Trade (Development and Regulations) Act, 1992 and the Customs Act, 1962 and Notification 32 (RE-2007)/2004-2009 dated 15.10.2007 as amended. After following the due process of law, the adjudicating authority imposed penalty of Rs. 2,00,000/- (Rupees Two Lakhs only) on the firm, Rs. 200,000/- (Rupees Two Lakhs only) on the CEO Shri K.K. Pillai and Rs. 1,00,000/- (Rupees One Lakh only) on Shri O.M. Mahadevan, the General Manager of the Company vide Order-in-Original No. 175/2010 dated 19.11.2010. Aggrieved by the said order, appellant filed two separate appeals before the Commissioner (Appeals) and the Commissioner (Appeals) vide the impugned order dismissed both the appeals. Hence the present two appeals.
3. None has appeared on behalf of the appellant in spite of the fact that the appellant was aware of the date of hearing as the appellant himself appeared on the last date of hearing dated 27.03.2017 when the case was adjourned for today. Since the case pertains to 2012 I am proceeding to decide the appeal on the basis of the material on record.
4. Heard the learned AR appeared on behalf of the Revenue. In the grounds of appeal, the appellant has challenged the impugned order imposing penalty being not sustainable in law. The appellant has also averred in the grounds of appeal that the appellant as well as its officers are not denied the allegation leveled against them in the show-cause notice but only to emphatically submit the reasons that compelled to undertake the export of prohibited items that the buyer had arm twisted the appellant by threatening to cancel the orders of frozen foods if non-basmati rice and wheat flour that are prohibited and had confessed before the authorities that the appellant had to succumb to the pressure, fearing cancellation of orders, consequent upon which, the closure of business leaving 250 employees jobless and their families in abject poverty. Moreover, the appellant was under belief that the prohibition will only be a temporary measure and subsequently when it was realized that the Government had no intention to lift the ban in the near future, voluntarily stopped the export of non-basmati rice and wheat flour instantly. It has also been alleged that the exports has not caused any loss of revenue to the exchequer and it was only an aberration in terms of the portions of foreign trade policy and the true amount of transaction was declared and the foreign exchange in full measure have been realized. The learned AR defended the impugned order by submitting that the appellants have admitted that they have exported the non-basmati rice in violation of the Notification No. 38 (RE-2007)/2004-09 dated 15.10.2007 banning the export of these items. He further submitted that the appellant exported non basmati rice and wheat flour despite ban on the same by mis-declaration of the goods which is admitted by the appellant. He further submitted that the penalty imposed is not very exorbitant. In support of his submission, he relied upon the following decisions:
a) M/s. Kunal Travel (Cargo) Vs. CC & CE, Noida 2017-TIOL-174-SC-Cus.
b) M/s. Kunal Travel (Cargo) Vs. CC and CE, 2016-TIOL-2978-HC-ALL-CUS.
5. After considering the submissions of the learned AR and perusal of the grounds of appeal and other material on record, I am of the view that there is no infirmity in the impugned order imposing the penalty on the appellants in view of the fact that they have exported non-basmati rice and wheat atta in violation of the notification banning the export of the same. Further the Honble Allahabad High Court in the case of Kunal Travel (Cargo) has also justified the imposition of penalty in the similar fact situation and the appeal of the assessee was dismissed by the Honble Supreme Court cited supra. In view of the decision of the Apex Court, I do not find any infirmity in the impugned order which is upheld by dismissing both the appeals.
(Operative portion of the Order was pronounced in Open Court on 27/06/2017) (S.S GARG) JUDICIAL MEMBER iss