2008 (6) TMI 526 - AT - Central Excise

Summary

Issues: Challenge of penalties under Section 112 of the Customs Act for aiding and abetting in the sale of duty-free imported goods in the domestic market.

In this judgment by the Appellate Tribunal CESTAT, Ahmedabad, the applicants challenged penalties imposed under Section 112 of the Customs Act for aiding and abetting M/s. Raj International in selling duty-free imported goods in the domestic market. The duty was confirmed against M/s. Raj International, which did not file any appeal. The tribunal found that the impugned order suffered from a violation of natural justice principles and relied on co-noticee statements without corroborating evidence. It was noted that the Chennai Bench had previously held that DGCEI officers in Bombay did not have jurisdiction for the whole of India, and thus, show cause notices issued by them for importations at Tuticorin were not valid. Similarly, in this case, importations were made at Surat, and no notification extending the jurisdiction of DGCEI officers in Bombay to Surat importations was provided. Therefore, the tribunal allowed all the stay petitions based on this jurisdictional ground.

The judgment highlighted the importance of jurisdiction in customs cases and the need for proper notification to extend the authority of officers. It emphasized the requirement for evidence to support penalties under the Customs Act and the consequences of violating principles of natural justice. The decision also referenced a previous ruling by the Chennai Bench to support the finding on jurisdictional issues. Overall, the judgment provided a detailed analysis of the legal grounds for allowing the stay petitions and set a precedent for cases involving penalties for aiding and abetting in customs violations.