2013 (11) TMI 1039 - AT - Customs

Fraudulent license - License by forgery or wilful mis-declaration - Export of prohibited goods - Held that - When forgery and fabrication is brought to record that should have been tested with evidence recorded. It appears that none of the export consignments nor specific shipping bills were put to test by customs to know the manner of occurrence of the transaction from the origin of goods till termination at the export stage. None of the evidence have been properly appraised nor evaluated while the evidence of the driver, transporters, supervisor, doctor and many other persons have been recorded under section 108 of Customs Act, 1962. Once the adjudication has not brought out clearly what was the issue before the authority for decision on the basis of facts and the relevant evidence on the touch stone of law applicable - Therefore, in all fairness adjudication has to go back to the learned Adjudicating Authority to determine the facts in issue and testing such facts on the touch stone of evidence and law - Decided in favour of assessee.

Summary

Issues:
1. Recovery of DEPB value from exporter
2. Prohibition of goods exported
3. Proper adjudication process
4. Authority to issue show cause notice
5. Evidence evaluation in adjudication
6. Re-adjudication process

Analysis:
1. The appellant argued that recovery of DEPB value from the exporter is not permissible under law, citing relevant judgments. The High Court held that DEPB value cannot be recovered if the scrip was not invalid at the time of issuance. The Tribunal's order was upheld, allowing the department to proceed against those who obtained licenses through forgery or misdeclaration.

2. The goods exported were not prohibited, as they met ITC provisions and were freely exportable. The absence of a law for recovery before the insertion of Section 28AAA in the Customs Act precludes allegations of DEPB utilization.

3. The adjudicating authority was criticized for concluding that exports were made unlawfully without due process. Allegations of using blank certificates were refuted, emphasizing the lack of evidence questioning the exported goods or veterinary certificates.

4. The appellant contended that the show cause notice was issued by an improper officer, challenging the authority's jurisdiction. The amendment to Section 28(11) of the Customs Act did not affect the applicability of relevant legal precedents.

5. Both sides presented extensive arguments during the hearing, questioning the thoroughness of the adjudication process. The lack of proper evaluation of evidence, including testimonies from various individuals, raised doubts about the decision-making process.

6. Due to procedural irregularities and lack of clarity in the adjudication order, the Tribunal remanded all appeals to the Adjudicating Authority for re-evaluation. The authority was instructed to consider the surrender of DEPB scrip and potential fraud in obtaining such benefits, emphasizing the need for a well-reasoned and expeditious decision. The appellant was granted a fair opportunity for re-adjudication to address penal consequences.