2012 (12) TMI 1093 - AT - Customs

Summary

Issues involved:
The judgment involves issues related to waiver and stay sought by appellants in respect of adjudged dues, penalty imposed under Section 114 and Section 114AA of the Customs Act, fraudulent drawback claims, financial hardships, and liability of individuals involved in fraudulent transactions.

Adjudged Dues and Penalty:
The appellant in Appeal No. C/258/2012 was asked to pay over Rs. 1.37 crores as drawback denied by the adjudicating authority for 154 Shipping Bills filed in the name of 12 persons with different IE Codes. Additionally, a penalty of Rs. 2 crores was imposed on the same appellant under Section 114 and Section 114AA of the Customs Act. The appellant in Appeal No. C/264/2012 challenged the penalty of Rs. 50 lakhs imposed on him under the same provisions. The appellants sought waiver and stay, with one appellant filing a miscellaneous application for amendments in the Memorandum of Appeal.

Role of Individuals in Fraudulent Transactions:
Shri Kalandar Seeni Ahmed was found at the center of the controversy, receiving over Rs. 1.37 crores in drawback for sub-standard goods under Shipping Bills filed by another individual. A penalty of Rs. 2 crores was imposed on Shri Kalandar Seeni Ahmed for his involvement in the fraudulent drawback claims. The appellant contested the penalty amount, claiming a lesser liability. However, the evidence supported the findings against Shri Kalandar Seeni Ahmed, who was held jointly and severally liable to pay the drawback amount.

Financial Hardships and Predeposits:
The appellant's plea of financial hardships was not substantiated with evidence, leading to a direction to predeposit Rs. 50 lakhs towards the drawback demand and Rs. 15 lakhs towards penalty within four weeks. Compliance was to be reported to the authorities, with waiver and stay granted for the balance amounts subject to due compliance.

Liability of Another Individual:
Shri Vijay Anand, involved in filing Shipping Bills, claimed innocence regarding fraudulent intent. However, statements given by Shri Vijay Anand under the Customs Act revealed his involvement in the fraudulent transactions. He was found to have deliberately participated in the fraudulent activities, leading to a penalty of Rs. 50 lakhs imposed on him. Shri Vijay Anand was directed to predeposit Rs. 20 lakhs towards the penalty, with waiver and stay granted for the balance amounts upon compliance.

Conclusion:
The judgment highlighted the liability of individuals in fraudulent transactions, the imposition of penalties under the Customs Act, considerations of financial hardships, and the requirement for predeposits to secure waiver and stay for the balance amounts.