2012 (3) TMI 448 - AT - Customs

Summary

Issues involved: Appeal against Order-in-Original CAO No: 111/2003/CAC/CC/SK dated 26/12/2003 passed by the Commissioner of Customs (Export Promotion), New Custom House, Mumbai.

Facts and Considerations:
- M/s. Balaji Traders filed shipping bills for export of cotton P/L ladies blouse, tops with inflated values.
- Examination revealed old and used goods with incorrect descriptions.
- Statements of involved parties confirmed fraudulent activities.
- Show cause notice issued proposing confiscation and penalties.
- Penalties imposed under Section 114 of the Customs Act, 1962.
- Appellants claim innocence based on lack of knowledge and good faith.

Appellants' Arguments:
- Appellants claim innocence based on lack of knowledge and good faith.
- Shri Maheshwari acted based on friendship and lack of awareness.
- Bhim Sen Singh accepted work based on recommendation and lack of mala fide intent.

Revenue's Position:
- Revenue asserts appellants were aware of fraudulent nature of transactions.
- Maheshwari impersonated as exporter and aided fraudulent activities.
- CHA failed to disclose impersonation and participated in fraudulent transaction.

Judgment:
- Transactions deemed fraudulent with misdeclaration of goods and inflated values.
- CHA aware of overvaluation and failed to disclose impersonation.
- Maheshwari impersonated as exporter and failed to reveal true parties.
- Penalties upheld but reduced due to individuals' limited involvement.
- Penalties reduced to &8377; 1.5 lakhs for Maheshwari and &8377; 30,000 for Bhim Sen Singh.

Disposition:
- Penalties reduced for appellants due to limited involvement.
- Lower authorities' orders upheld with modifications.
- Appeals disposed of with reduced penalties for appellants.