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2022 (1) TMI 522 - AT - CustomsQuantum of penalty levied under Section 114 (iii) of the Customs Act, 1962 - fraudulent export as goods were grossly undervalued - rejection of declared value - appellant s alleged offence is that he has submitted the Shipping Bill duly signed by him wherein, the value was declared exorbitantly higher side - confiscation of goods - HELD THAT - The valuation was not done by the appellant, the appellant have signed the shipping Bill only on the authorisation of his employer firm M/s. MAZDA GLOBAL, the value was taken from the invoice which was prepared and signed by the Proprietor of M/s. MAZDA GLOBAL Smt. Bharti J Gandhi which was sent to the appellant by Shri Amish Gandhi. The appellant being an employee of the M/s. MAZDA GLOBAL has no reason to dispute the valuation as the original valuation was finalized by his employer M/s. MAZDA GLOBAL through the proprietor Smt. Bharti Gandhi. The appellant being a less graduated person cannot be made to know the technicalities of the product as well as the value of the goods as regard the decision about the nature of the goods and value thereof - As in the present case the facts which is not under dispute that right from manufacturing and valuation of the goods, it is a modus operandi planned by proprietor Smt. Bharti Gandhi and son Shri Amish Gandhi and they issued the invoice for the goods in question therefore, the appellant being employee of the company had no reason to dispute or question the value mentioned in the invoice as that is not his subject matter. He was only authorised to sign and file the Shipping Bill which is not to be prepared only on the basis of invoice. It is also to be noted that even the appellant had no knowledge to prepare Shipping Bill which was admittedly prepared by CHA, he simply put his signature therefore, the only offence which exist is the over valuation of the goods which is not creation of the appellant but it was done by his employer firm through Smt. Bharti Gandhi and her son Shri Amish Gandhi. Allegation that the appellant was aware that the value of the goods is not more than ₹ 10,000/- - HELD THAT - This version of the appellant came only after the investigation has started. Even as per the standard of the appellant and his education level, it cannot be expected from him to know about value of the goods. Since he has received the invoice from his employer, he had no option except to mention the same value in the Shipping Bill therefore, merely because during investigation he stated that his awareness of the value of the goods i.e. ₹ 10,000/- is baseless, even the value of ₹ 10,000 was not justified - the appellant has acted only on the instruction of the employer and more so on the basis of the signed documents i.e. invoice given by his employer. The exorbitant penalty of ₹ 75 Lacs is not justified - Since the appellant is not involved in the main offence of over valuation of the goods but admittedly signed the Shipping Bill, he is liable for some token penalty - the penalty is reduced from ₹ 75 Lacs to ₹ 25,000/-. Appeal allowed in part.
Issues Involved:
1. Imposition of penalty under Section 114(iii) of the Customs Act, 1962. 2. Alleged overvaluation of goods intended for export. 3. Role and responsibility of the appellant, an employee of M/s. MAZDA GLOBAL. 4. Delay in adjudication of the show cause notice. Detailed Analysis: 1. Imposition of Penalty under Section 114(iii) of the Customs Act, 1962: The appellant, an employee of M/s. MAZDA GLOBAL, was penalized ?75 Lacs under Section 114(iii) of the Customs Act, 1962. The original penalty was ?1,00,00,000/- imposed by the Adjudicating Authority, which was reduced by the Commissioner (Appeals). The penalty was based on the allegation of the appellant's involvement in fraudulent export by overvaluing goods. 2. Alleged Overvaluation of Goods Intended for Export: The case involved an attempt to export goods at an exorbitantly overvalued price. The goods were declared as "Friction Free Die" with a declared value of ?1,25,09,319.00 (USD 2,83,980/-) in the shipping bill, which was later found to be only ?6,000/-. The goods were seized under Section 113 of the Customs Act, 1962, for being grossly overvalued. 3. Role and Responsibility of the Appellant, an Employee of M/s. MAZDA GLOBAL: The appellant, a 9th-standard pass individual, was employed as a low-level worker and not conversant with English. He signed the shipping bill on the authorization of his employer, M/s. MAZDA GLOBAL. The valuation was done by the employer, and the appellant had no reason to dispute it. The appellant's role was limited to signing the shipping bill based on the invoice prepared and signed by the employer. The appellant did not benefit from the overvaluation and was not involved in the planning or execution of the fraudulent export. 4. Delay in Adjudication of the Show Cause Notice: The show cause notice was issued on 26.09.2007 and adjudicated on 26.06.2018, almost 11 years later. The appellant argued that the delay vitiated the proceedings. Although no specific time limit for adjudication is prescribed under the Customs Act, the appellant cited various judgments to support the argument that such a delay should invalidate the proceedings. Judgment Summary: The Tribunal found that the appellant, a low-level employee, acted on the instructions of his employer and was not aware of the overvaluation. The penalty of ?75 Lacs was deemed exorbitant and not justified. The Tribunal reduced the penalty to ?25,000/- considering the appellant's limited role and lack of involvement in the fraudulent activities. The impugned order was modified accordingly, and the appeal was partly allowed.
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