2020 (2) TMI 409 - HC - Customs

Penalty u/s 112 (a) and/or 112 (b) of the Customs Act, 1962 - alleged evasion of duty - fraud - HELD THAT - The Commissioner has observed that the Petitioner along with other persons aided Mr. Pravin Mody in the evasion of duty and fully aware of the fraud. The Commissioner, after assessing the facts on record held that the deposit was not made by the Petitioner but by Mr. Pravin Mody. If it is the case of the Petitioner that the amount was not deposited by Mr. Pravin Mody, it would be a case of wrong forfeiture of the deposit. Nothing is shown as to why this ground cannot be agitated in the pending appeal filed by the Appellant. Since this remedy of Appeal is available and already availed of, it is not necessary to examine this issue in this Petition. Petition disposed off.

Summary

Issues:
1. Direction to refund deposited amount of ?10,00,000.
2. Imposition of penalty under Section 112 (a) and/or 112 (b) of the Customs Act, 1962.
3. Forfeiture of deposit made by the Petitioner.
4. Assessment of involvement in duty evasion with Mr. Pravin Mody.

Analysis:

1. The Petitioner sought a direction for the refund of ?10,00,000 deposited amount. A show cause notice was issued regarding duty evasion, leading to a penalty imposed by the Commissioner. The Petitioner filed an Appeal against this order, challenging the forfeiture of the deposit. The Commissioner alleged that the deposit was made by Mr. Pravin Mody, the alleged mastermind in the fraud. However, the Petitioner contended that he made the deposit, disputing the Commissioner's conclusion.

2. The Commissioner imposed a penalty on the Petitioner under Section 112 (a) and/or 112 (b) of the Customs Act, 1962, for acts of omission and commission related to duty evasion. The Petitioner's Appeal against this penalty was pending, with the argument that the Commissioner erroneously forfeited the deposit, attributing it to Mr. Pravin Mody. The Petitioner claimed that the deposit was indeed made by him, not Mr. Pravin Mody, contesting the basis of the forfeiture.

3. The Commissioner, after assessing the facts, concluded that the deposit was not made by the Petitioner but by Mr. Pravin Mody, alleging the Petitioner's involvement in aiding duty evasion. The Court noted that if the Petitioner disputes this claim, it should be raised in the pending Appeal rather than in the current Petition. The Court refrained from delving into this issue, as the Appeal provided the appropriate forum for addressing the dispute over the deposit's ownership.

4. The judgment highlighted the importance of utilizing the available remedy of Appeal to address issues such as the ownership of the deposit and involvement in duty evasion. By disposing of the Writ Petition while keeping all contentions open, the Court emphasized the significance of pursuing legal remedies through the appropriate channels, in this case, the pending Appeal.