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Issues Involved:
1. Duty demand, penalty, and confiscation of goods imposed by the Commissioner of Customs. 2. Validity of claiming exemption under Notification No. 149/95. 3. Disownment of goods by the appellants and their connection to the import. 4. Liability of proprietary firms and their proprietors for penalties under Section 114A. 5. Reduction of penalties based on the role and conduct of the individuals involved. 6. Confiscation of goods under Section 111(m) and (d) of the Customs Act. Analysis: Issue 1: Duty demand, penalty, and confiscation of goods The appeals arose from an order by the Commissioner of Customs demanding duty, imposing penalties, and confiscating goods imported by the firms. The Commissioner imposed penalties on the firms and the proprietor under Section 114A, along with appropriate redemption fines. The appellants contested these penalties and confiscation. Issue 2: Validity of claiming exemption under Notification No. 149/95 The firms claimed exemption under Notification No. 149/95 for duty-free clearance of bearings. However, investigations revealed that a duplicate advance license was used to import more goods than allowed in the original license. This led to the goods being considered offending as they were cleared under an invalid license. Issue 3: Disownment of goods and connection to import The appellants disowned the goods, claiming they were not the owners and were not connected to the import. The proprietor signed blank papers provided by the real importers, disassociating himself from the import and fraud perpetrated by others. Issue 4: Liability of proprietary firms and proprietors for penalties The debate centered on whether penalties could be imposed on proprietary firms represented by their proprietors. The Tribunal acknowledged that the imports were made in the names of proprietary firms, but set aside the penalties imposed on the firms based on the legal position regarding the liability of proprietary firms to penal action. Issue 5: Reduction of penalties based on role and conduct While the proprietor was found to have caused the import of goods liable for confiscation, the Tribunal noted his indirect complicity in the fraud due to signing blank papers and obtaining the IE Code. A reduced penalty of Rs. 75,000 was imposed considering his financial position and role in the affair. Issue 6: Confiscation of goods under Section 111(m) and (d) The Tribunal upheld the confiscation of goods under Section 111(m) and (d) of the Customs Act, confirming the demand for duty on the imported goods. The penalties on the firms were set aside, and the penalty on the proprietor was reduced to Rs. 75,000 in one case and Rs. 2,50,000 in another, based on the specific circumstances of each appeal.
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