Custom, Excise & Service Tax Tribunal
Saurav Chopra vs Commissioner Of Customs-New ... on 14 January, 2025
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI
PRINCIPAL BENCH, COURT NO. 1
CUSTOM APPEAL NO. 52707 OF 2019
[Arising out of Order-in-Appeal No. CC(A)/CUS/D-II/Pre./NCH/619/2019-20 dated
30.08.2019 passed by the Commissioner of Customs (Appeals), New Delhi]
Saurav Chopra Appellant
R/o WZ-276-C, 2nd Floor,
Inderpuri, New Delhi-110012
Vs.
Commissioner of Customs, Respondent
New Customs House,
Near IGI Airport,
New Delhi-110037
Appearance:
Present for the Appellant: Shri Gaurav Prakash, Advocate
Present for the Respondent: Shri Rajesh Singh, Authorised Representative
CORAM:
HON'BLE MR. JUSTICE DILIP GUPTA, PRESIDENT
HON'BLE MS. HEMAMBIKA R. PRIYA, MEMBER ( TECHNICAL )
Date of Hearing/Decision: 14/01/2025
FINAL ORDER NO. 50083/2025
JUSTICE DILIP GUPTA
Saurabh Chopra1 has filed this appeal for quashing the order dated
30.08.2019 passed by the Commissioner of Custom (Appeals)2 upholding
the order dated 31.01.2017 passed by the Joint Commissioner imposing a
1 the appellant
2 the Commissioner (Appeals)
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penalty of Rs.5 Lakhs upon the appellant under section 114 of the Customs
Act, 19623.
2. It transpires from the records that a show cause notice dated
28.08.2014 was issued to Anil Gadodia, Mayur Ranjan, the appellant and
four others. The relevant paragraph 34.4 and paragraph 35 of the show
cause notice are reproduced below:
"34.4 Shri Saurav Chopra @Saurav, who knowingly engaged himself
in illegal supply of Red Sanders and making arrangements for
fraudulent exports and actively associated himself in an organized
manner in smuggling of Red Sanders to Mr. Lin of China, with the help
of other syndicate members i.e, Shri Anil Gadodia, Shri Mayur Ranjan,
Shri Yodying, Shri Daljeet, Shri Kamal Negi and Shri Vinod Saini. Thus,
for the said acts of omissions and commissions on his part, Shri
Saurabh Chopra @Saurav appears to have rendered himself liable to
penal action under Section 114 of the Customs Act, 1962.
35. Now, therefore Shri Anil Gadodia S/o Late. Shri Shyam Sunder
Gadodia, resident of 882-A, Kedar Building Ghanta Ghar, Old Subzi
Mandi, Delhi; Shri Mayur Ranjan resident of N.P. 157D, Near Gopal
Mandir, Pitampura, New Delhi; Mr. Yodying resident of F-76, 3™ Floor,
Mansarovar Garden, New Delhi; Shri Daljeet resident of 94, Upper
Ground Floor, Abchal Nagar, Nilothi Ext., Chander Vihar, Delhi; Shri
Saurav Chopra resident of WZ-276-C, 2nd Floor, Inderpuri, New Delhi,
Shri Kamal Negi resident of B-12/24, Kaushik Enclave, Burari, New
Delhi-110084 and Shri Vinod Saini resident of A 5/86, Rajbeer Colony,
Delhi-g6 or any other person/persons claiming the ownership of
aforesaid seized goods/currency. ete as mentioned in above are
hereby called upon to show cause to the Joint / Additional
Commissioner of Customs (Preventive), New Customs House, Near IGI
Airport, New Delhi-37, as to why the seized goods/currency etc., as
mentioned above, which was attempted to be smuggled out of
India/smuggled out of India/prepared to be exported should not be
confiscated under Section 113 read with Section 121 of the Customs
Act, 1962 for violation of Section 11 of the Customs Act, 1962 read
with appendix II of CITES.
(a) The above named noticees are hereby required to note that.
their reply may be accompanied by the evidences, documentary
or otherwise, on which they intend to rely and that if no reply is
received within the stipulated time, it will be presumed that they
have no explanation to offer and the case will be adjudicated on
the basis of evidence on record. They are also hereby called
upon to state as to whether they wish to be heard in person. If
no specific request is made in their reply in this regard, it would
be presumed that they do not want a personal hearing."
3. the Customs Act
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3. The Joint Commissioner, by the order dated 31.01.2017, passed the
following order in respect of Anil Gadodia, Mayur Ranjan and the appellant:
"(i) I confiscate 23.03.Kgs. (red coloured) Red Sanders wood seized
vide panchnama dated 28.09.2013 from residential-cum-business
premises of Shri Anil Gadodia, situated at 882-A, Kedar Building,
Ghanta Ghar, Old Sabji Mandi, Delhi-7 valued at Rs. 23,030/- @ Rs10
Lakhs PMT under Section 113 of the Customs Act, 1962 for violation of
Section 11 of the Customs Act, 1962 read with appendix ll of CITES. I
refrain from confiscation of 75.808Kgs. goods found to be Sandalwood
which were seized vide panchnama dated 28.09.2013 from residential-
cum-business premises of Shri Anil Gadodia, situated at 882-A, Kedar
Building, Ghanta Ghar, Old Sabji Mandi, Delhi-7.
(ii) I confiscate Rs.24.50 lac seized from residential-cum-business
premises of Shri Anil Gadodia, situated at 882-A, Kedar Building,
Ghanta Ghar, Old Sabji Mandi, Delhi-7 searched under panchnama
dated 28.09.2013 under Section 121 of the Customs Act, 1962 for
violation of Section 11 of the Customs Act, 1962 read with appendix II
of CITES.
(iii) I confiscate 750 Kgs. red sanders valued at Rs. 7.50 lacs @ Rs
10 Lakhs PMT (difference of 11.411 MT i.e. total of serial No. 1,2, 9
and 12 of panhnama dated 28.09.2013/ 01.08.2014 drawn at the
godown of Shri Anil Gadodia, found to be red sanders (as per report
dated 04.02.2015 of Office of the Scientist-D, Central National
Herbarium, Botanical Garden, Howrah in respect of four samples) and
10.660 MT red sanders which was in net balance stock of Sh. Anil
gadodia) seized from the godown of Shri Anil Gadodia situated at A-
32, Wazirpur Industrial Area, Opposite J.D. Dharam Kanta, Delhi-52
under panchnama dated 28. 09.2013 under Section 113 of the
Customs Act, 1962 for violation of Section 11 of the Customs Act,
1962 read with appendix ll of CITES. I refrain from confiscation of rest
of 20.223 MT goods found to be Sandalwood instead of red sanders
(as per report dated 28.12.2016 of Institute of Wood Science &
Technology, Bangalore in respect of 13 samples) and 10.660 MT red
sanders which was shown in stock of Sh. Anil gadodia (Total 20.223
MT + 10.660 MT= 30.883 MT) seized from the godown of Shri Anil
Gadodia situated at A-32, Wazirpur Industrial Area, Opposite J.D.
Dharam Kanta, Delhi-52 under panchnama dated 28. 09.2013.
xxx xxx xxx
(vi) I impose penalty of Rs.10,00,000/- (ten lakhs only) on Shri Anil
Gadodia S/o Late Shri Shyam Sunder Gadodia, resident of 882-A,
Kedar Building Ghanta Ghar, Old Subzi Mandi, Delhi under Section 114
of the Customs Act, 1962 for his acts of omissions and commissions as
stated above.
(vii) I impose penalty of Rs. 5,00,000/- (five lakhs only) on Shri
Mayur Ranjan resident of N.P 157D, Near Gopal: Mandir, Pitampura,
New Delhi under Section 114 of the Customs Act, 1962 for his acts of
omissions and commissions as stated above.
xxx xxx xxx
(x) I impose penalty of Rs. 5,00,000/- (five lakhs only) on Shri
Saurav Chopra resident of WZ-276-C, 2nd Floor, Inderpuri, New Delhi
under Section 114 of the Customs Act, 1962 for his acts of omissions
and commissions as stated above."
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4. The aforesaid order dated 31.01.2017 was assailed by the appellant by
filing an appeal before the Commissioner (Appeals) and the Commissioner
(Appeals), by order dated 30.08.2019, dismissed the appeal holding as
follows:
"32.4 Shri Saurav Chopra in the guise of freight forwarder knowingly
engaged and actively associated himself with smuggling syndicate for
monetary consideration as detailed below:-
(i) On being asked by Shri Yodying@Chan for arranging export of Red
Sanders fraudulently, he contacted Shri Daljeet for such fraudulent
exports;
(ii) He finalized the rates @ Rs. 450/- per Kg. for arranging the export
of red Sanders and received two consignments of red Sanders of about
6 MT and 7 MT, which were accompanied by Shri Mayur Ranjan @
Vijay. After receiving the said consignments he handed over the same
to Shri Daljeet at his Todapur go-down for packing, who after packing
handed over the same to Shri Kamal Negi for export on his direction:
(iii) He arranged one more consignment of 8.02 MT of Red Sanders
from Shri Anil Gadodia which was to be exported;
(iv) He received another consignment of 18 MT af Red Sanders from
Chan and Mayur Ranjan @ Vijay, which was also handed over by him
to Shri Daljeet for packing and finally exported. The said quantity of
Red Sanders was fraudulently exported using IEC of M/s Tulika
Appliances to M/s RICHUP Corporation, Hong Kong, which was
subsequently seized by Hong Kong Customs.
The above is further substantiated from his own admission under
statement dated 29.09.2013. and 31.07.2014 and statements dated
28.09.2013, 29.09.2013 and 18.07.2014 of Shri Daljeet as
enumerated above."
5. This appeal has been filed by the appellant to assail the aforesaid
order dated 30.08.2019 passed by the Commissioner (Appeals).
6. Shri Saurabh Sharma, learned counsel appearing for the appellant has
stated that both Anil Gadodia and Mayur Ranjan had challenged the order
passed by the adjudicating authority and the Commissioner (Appeals) before
the Tribunal and both the appeals were allowed. In respect of the appeal
filed by Anil Gadodia, being Customs Appeal No. 52231 of 2019 decided on
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19.02.2020, a Division Bench of this Tribunal set aside the order assailed
with the following observations:
"The brief facts of the case are that the DRI on 28.09.2013 detained 5
export consignments of M/s. Eurro Exports at CFS, Mundra, declared
to contain marble slabs. Out of 5 containers, in the 4 containers a total
of 14.25 MTs of red sanders were found concealed behind crates
containing 93.31MTs of marble slabs. Since, export of red sanders was
prohibited as per Foreign Trade Policy during the relevant period, the
red sanders as well as the marble used for concealing the red sanders
were seized. In follow up action, searches were conducted at various
premises and some more goods including red sanders and documents
were seized. As per details given below: -
I) From the residence-cum-business premises of the appellant
at Delhi 75.808 Kgs of brown colour sandalwood and 23.03 Kgs
of red sanders valued at Rs. 98,838/- were detained on
28.09.2013. Indian currency of Rs. 14.50 Lakhs was detained
from the premises and an additional cash of. Rs 10 Lakhs from
a person named Shiv Kumar who had just arrived at the
premises. The detention was subsequently converted to seizure
on 14.03.2014.
II) 31.633 MT of red sanders, white wood logs, white wood
powder, red wood powder, brown wood powder, etc were
seized from godown of the appellant in Wazirpur Industrial
Area, Delhi.
III) Some documents were seized from the resident of one Shri
May Ranjan, New Delhi.
IV) Indian Currency of Rs. 4.20 Lakhs and some documents
were seized from the residence in New Delhi of one Mr. Yodying
@ Chan.
V) 8.02 MT of red sander logs and some saw-dust were seized
from the godown of Shri Daljeet Singh, New Delhi.
VI) Some documents were also recovered from the residential
premises of Shri Daljeet Singh at New Delhi, on 28.09.2013,
which were formally seized on 14.03.2014.
VII) A laptop was resumed from the residential premises of one
Shri Saurabh Chopra on 29.09.2013 which was later formally
seized on 14.03.2014.
8.3 In view of the above judgments it is settled that when the
appellant sought for cross examination of the witness and if the
request is not acceded to the adjudicating authority should not have
relied upon the statements of such witness. The appellants case is on
better footing as their request for cross examination is reinforced with
the retraction of the most of the statements, therefore, since the
adjudicating authority has not granted the cross examination, all the
statements have no evidentiary value and case could have been
decided without the support of such statements.
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9. In the present case except statements there is no evidence
to show that the goods allegedly kept with intention to attempt
the export thereof. No piece of document which show that the
red senders stored were meant for export it is undisputed fact
that the appellant is a licensed trader of red senders who
purchase the red senders in Government auction and trade
within the country, therefore, by any stretch of imagination it
cannot be construed that the goods lying with the appellant
were attempted to the export.
10. In our view, in order to establish that there is attempt to
export it is necessary that either the goods have entered into
port area or if it is outside port area there should be some
documents such as invoice/shipping bill/LR for transportation
of goods to the port etc. In the present case goods were lying much
away from the port area i.e. the goods were lying at Delhi whereas it
was alleged that the goods supposed to be exported from Mundra port.
In absence of any such evidence and with facts that the appellant is
engaged in the trading of red senders domestically, there is no support
of any evidence, in the allegation of the Revenue that the goods red
senders attempted to export as prohibited goods. The appellant also
submitted that even in case of goods found loaded in the container at
port, the appellant was exonerated from any alleged wrong doing. It
was also submitted that the same statements were relied upon in the
case of seizure of four containers and in the present case. Though the
said case has a persuasive value but in the present case we have
given independent finding as above that the statements firstly
retracted and secondly without cross examination cannot be used as
evidence. We are therefore of the view that the entire case made out
only on the basis of statements which we held that the same do not
have evidentiary value. The Revenue could not establish a case of
attempt to export the prohibited goods. Therefore entire action is
illegal and without authority of law.
11. As per our above discussion, the confiscation of red senders, cash
seized during the investigation are not sustainable, hence, the
confiscation is set aside. Consequently the penalty imposed on the
appellant is also set aside. The appeal is allowed."
(emphasis supplied)
7. Mayur Ranjan also challenged the order passed by the Commissioner
(Appeals) by filing Customs Appeal No. 50098 of 2020 which appeal was
allowed on 16.09.2020 and the relevant portion of the order is reproduced
below:
"12. Having considered the rival contentions, relying on the finding of
the Division Bench of this Tribunal with respect to the common show-
cause notice and common order-in-original, that there is no evidence
to show that the goods were allegedly kept with intention to export or
were attempted to be exported, no case of confiscation is made out. It
was also observed by the Division Bench that so far the seizure of red
sanders at Mundra CFS is concerned, there is a separate show-cause
notice, not concerned with the seizure at Delhi. The Division Bench
also held that the entire case of the Revenue is made out mainly based
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on the retracted statements, which have held no evidentiary value. It
was also held that Revenue could not establish the case of attempt to
export of prohibited goods and, accordingly, held that the confiscation
of red sanders and cash is not sustainable and consequential penalty
imposed was also set aside.
13. Accordingly, I hold that no case is made out against this appellant
also as the confiscation itself has been set aside. I also hold that no
case of abetment is made out against this appellant in the facts and
circumstances. Accordingly, the appeal is allowed and the penalty
imposed under section 114 is set aside."
8. It is also pointed out by the learned counsel for the appellant that the
department had challenged both the orders passed by the Tribunal in the
matter of Anil Gadodia and Mayur Ranjan before the Delhi High Court in
CUSAA 55/2021 and CUSAA 10/2022.
9. In the matter of Anil Gadodia, the following order was passed by the
Delhi High Court:
ORDER
"1. Learned counsel for applicant submits that he has instructions to withdraw the appeal on account of low tax effect.
2. The appeal is accordingly dismissed as withdrawn."
10. In the matter of Mayur Ranjan, the following order was passed by the Delhi High Court:
" [Physical court hearing/ hybrid hearing (as per request)]
1. Mr Harpreet Singh, learned senior standing counsel, draws our attention to the Central Board of Excise & Customs' [CBEC] circular bearing no. 390/Misc./163/2010-JC, dated 17.12.2015.
2. A perusal of the above-mentioned circular discloses that the appeals having pecuniary impact below Rs.15,00,000/- are not to be preferred by the revenue before the High Court."
11. Learned counsel for the appellant, therefore, submits that this appeal filed by Saurav Chopra, should also be allowed for the reason that the 8 C/52707/2019 Tribunal had examined the issue on merits in the matter of Anil Gadodia. It is also pointed out that a common show cause notice was issued to all the three and a common order was passed by the adjudicating authority. Learned counsel submits that the appellant is merely a freight forwarder and once it was found that it was a town seizure, no penalty can be imposed upon the appellant.
12. Learned authorized representative appearing for the department has, however, supported the impugned order and submitted that the role of the present appellant is different from the roles assigned to the appellants in the appeals decided by the Tribunal.
13. The submissions advanced by the learned counsel for the appellant and the learned authorized representative appearing for the department have been considered.
14. In the appeal filed by Anil Gadodia, as noticed above, the Tribunal has recorded a categorical findings of fact that except for the statement there was no evidence that the goods were kept with an intention to export them. In fact, the Tribunal also recorded a finding that no document had been placed to substantiate that red senders was meant for export. The decision of the Tribunal has attained finality as the appeal filed by the department was dismissed by the Delhi High Court, though on monetary limits. In the present case also the appellant had sought cross-examination which was denied. The appellant may be a freight forwarder, but in the absence of any evidence that the goods were to be exported, penalty could not have been imposed upon the appellant.
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15. Thus, for the reasons stated by the Tribunal in the order dated 28.02.2020 in the matter of Anil Gadodia, the order impugned in the present appeal deserves to be set aside and is set aside. The appeal is, accordingly, allowed.
(JUSTICE DILIP GUPTA) PRESIDENT (HEMAMBIKA R. PRIYA) MEMBER (TECHNICAL) Archana