2007 (1) TMI 53 - AT - Customs

Penalty Alleged that goods had been willfully misdeclared and overvalued by appellant to obtain undue drawback and accordingly penalty imposed on it Held the allegation right and penalty sustained

Summary

Issues:
Penalty imposed on Shri K.N. Parameswaran for alleged involvement in fraudulent export to obtain undue drawback.

Detailed Analysis:

1. Facts of the Case:
- A consignment of cotton knitted T Shirts was found to contain inferior knitted fabrics, leading to seizure by Customs officers.
- Statements from various individuals implicated Shri K.N. Parameswaran in the export transaction involving overinvoicing of goods to claim higher drawback.

2. Role of Shri K.N. Parameswaran:
- Shri Parameswaran denied involvement in procuring export goods, claiming to be a freight forwarder.
- Commissioner found him complicit based on statements and evidence of his role as a buying agent and in arranging transport for the goods.

3. Commissioner's Findings and Penalties:
- Commissioner concluded that Shri Parameswaran, along with other individuals, committed fraud by overvaluing goods for export.
- Penalties imposed under Section 114 of the Customs Act, including a Rs. 50,000/- penalty on Shri Parameswaran for abetting the fraudulent export.

4. Appeal and Arguments:
- In the appeal, it was argued that Shri Parameswaran was penalized without concrete evidence of his involvement in the offence.
- Appellant's counsel contended that the finding of guilt was solely based on statements of co-accused.

5. Appellate Tribunal's Decision:
- Tribunal analyzed statements of co-accused and found evidence of Shri Parameswaran's involvement as a buying agent and in overinvoicing goods.
- Despite lack of dominant role, the Tribunal upheld the charge of abetment and reduced the penalty on Shri Parameswaran to Rs. 20,000/-.

6. Conclusion:
- Shri K.N. Parameswaran's involvement in the fraudulent export scheme was established, leading to the penalty reduction by the Tribunal.
- The Tribunal's decision highlighted the appellant's role in the offence and the mitigating circumstances considered for the penalty reduction.