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2015 (1) TMI 840 - AT - CustomsPenalty u/s 112(a) on Chartered Accountant (CA) for issuing false certificate - certificate issued on the basis of unsigned and unaudited documents - Contravention of licensing provisions - Held that - Appellant had issued the certificate which was proved to be false. As regards the submission of the learned Counsel that certificates were issued on the basis of documents produced by M/s. Elit, it has been admitted that the documents submitted by M/s. Elit was unsigned and not audited. As a Chartered Accountant he is of duty bound to issue any certificate only on the basis of audited books of accounts. From the records, it is a fact that the certificate was issued by the Chartered Accountant without having any audited balance sheet or books of accounts. It is clear from the fact that the appellant has intentionally and very consciously certified the export turn over during the period 1998-99, 1999-2000 and 2000-2001 - offence committed by the appellant is clearly established and I do not find any infirmity in such findings and the Commissioner (Appeals) also correctly upheld the penalty imposed on the appellant - Decided against assesse.
Issues: Appeal against imposition of penalty under Section 112(a) of Customs Act for issuing a false Chartered Accountant certificate leading to evasion of Customs duty.
Analysis: 1. Issue of False Certificate: The appellant, a Chartered Accountant, issued a certificate regarding the financial turnover of a company for the purpose of obtaining a DEEC certificate. However, it was found that the certificate was false and based on unsigned and unaudited documents. The appellant admitted to issuing the certificate without verifying audited books of accounts, which is against professional standards. The lower adjudicating authority found that the appellant intentionally and consciously certified false export turnover, facilitating the evasion of Customs duty. 2. Appellant's Defense: The appellant argued that the certificate was issued in good faith and professional capacity based on documents provided by the company. The appellant claimed innocence, stating that he was not involved in the fraud committed by the company. However, the tribunal noted that the appellant's duty as a Chartered Accountant was to issue certificates only based on audited documents, which was not the case in this instance. 3. Findings and Penalty Imposition: The tribunal upheld the penalty imposed under Section 112(a) of the Customs Act, as the appellant's actions directly or indirectly aided the company in contravening Customs provisions, leading to the evasion of duty. The tribunal agreed with the lower authority's findings that the appellant's issuance of false certificates facilitated the company in obtaining authorizations without fulfilling necessary requirements, resulting in the diversion of goods in the local market. 4. Conclusion: The tribunal dismissed the appeal, stating that the offense committed by the appellant was clearly established based on the findings, and there was no error in upholding the penalty imposed. The judgment serves as a reminder of the professional responsibilities of Chartered Accountants in issuing certificates and highlights the consequences of facilitating fraudulent activities that lead to Customs duty evasion.
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