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Issues Involved:
1. Demand of duty and penalties on M/s. MNS Exports Pvt. Ltd. and Shri Narayana Bhatt. 2. Penalties on employees of M/s. MNS Exports Pvt. Ltd. (Shri Ravi Prakash, Shri B. Prasad, and Shri Srinivasa Rao). 3. Penalty on Smt. Shilla Shree. 4. Penalty on Shri Vikram Jain. Analysis of Judgment: 1. Demand of Duty and Penalties on M/s. MNS Exports Pvt. Ltd. and Shri Narayana Bhatt: The Adjudicating Authority demanded duty of Rs. 7,29,572/- under Section 72 of the Customs Act, 1962, for goods seized on 26-4-1999, which were removed and kept outside the licensed premises. The authority also demanded Rs. 34,54,338/- under Section 28 of the Customs Act, 1962, for consignments imported under 12 AWBs and related Bills of Entry. Penalties were imposed under Section 112 of the Customs Act, 1962, and the EOU Licence was canceled under Section 58(3) of the Customs Act, 1962. Arguments by M/s. MNS Exports and Shri Narayana Bhatt: - The removal of duty-free goods was due to an emergency caused by a thunderstorm, and there was no intention to divert them to local markets. - The goods were used in export production with the Customs Commissioner's permission, making the duty demand unsustainable. - The cancellation of the EOU licence was harsh and inconsistent with actions taken against other EOUs involved in similar activities. Tribunal's Findings: - The removal of goods was found to be without mala fide intention due to emergency circumstances. - The demand of duty of Rs. 7,29,572/- and penalties on M/s. MNS Exports and Shri Narayana Bhatt were set aside. - The demand of Rs. 34,54,338/- was also set aside as M/s. MNS Exports were not the actual importers, and the employees acted beyond their authority. 2. Penalties on Employees of M/s. MNS Exports Pvt. Ltd. (Shri Ravi Prakash, Shri B. Prasad, and Shri Srinivasa Rao): The employees were penalized under Section 112(b)(ii) of the Customs Act, 1962, for their involvement in clearing goods in the name of M/s. MNS Exports but delivering them to Shri Bhaskar and ultimately to Shri Vikram Jain. Arguments by Employees: - They acted under the threat and instructions of the Customs Officer, Shri H. Bhaskar, and were unaware of the ultimate disposal of the goods. - They cooperated with the investigation and were first-time offenders facing financial difficulties after losing their jobs. Tribunal's Findings: - The employees knowingly participated in the illegal activities for monetary gain. - The penalties imposed were justified, and the appeals were dismissed. 3. Penalty on Smt. Shilla Shree: Smt. Shilla Shree was penalized under Section 112 of the Customs Act, 1962, based on the use of her car for transporting goods and issuing a cheque of Rs. 15,000/- to Shri Ravi Prakash. Arguments by Smt. Shilla Shree: - She was not involved in the import activities and issued the cheque under her husband's instructions without knowledge of the illegal dealings. Tribunal's Findings: - The evidence did not establish her knowledge or involvement in the illegal activities. - The penalty was set aside, and her appeal was allowed. 4. Penalty on Shri Vikram Jain: Shri Vikram Jain was penalized Rs. 5,00,000/- under Section 112(b)(ii) of the Customs Act, 1962, for his role in arranging imports and exporting the goods to fulfill DEEC Licences obligations. Arguments by Shri Vikram Jain: - There was no direct evidence implicating him in the import activities. - His request to cross-examine officers was denied, violating the Principles of Natural Justice. - He retracted his statements, claiming they were made under duress. Tribunal's Findings: - There was overwhelming evidence of his involvement, including statements from Shri Bhaskar and the transporter. - The penalty was justified, and the appeal was rejected. Conclusion: The Tribunal set aside the duty demands and penalties on M/s. MNS Exports Pvt. Ltd. and Shri Narayana Bhatt, and the penalty on Smt. Shilla Shree. However, the penalties on the employees and Shri Vikram Jain were upheld, dismissing their appeals.
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