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TMI Blog1933 (4) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... nan Rs. 2,00,000 (11) M/s. K. Uttamlal (Exports) Ld. Rs. 23,48,000 (12) -do- Rs. 36,00,000 2. The learned Advocate Shri Jayaraj for the applicants at Sl. Nos. 1, 2, 3, 5 to 10, pleaded that so far as applicants in Stay Petitions C/248/91, C/372/91, C/304/91, C/166, 168 & 169/92 are concerned they belonged to the same group and are the proprietary concern of one Shri K. Siraj. He pleaded that the applicants, after the consignment had been imported and action was sought to be initiated against the applicants, moved the Hon'ble High Court of Madras in respect of the importations of Lupofresh Aromatic Hop Extract Pellets with 15%/30% Alpha Acid content/Crop 90 and released the goods in terms of the High Court's order as indicated below : Applicants W.P. No. High Court's order M/s. Integrated Exports. W.P. 15553/90 dt. 25-9-1990. Allowed to clear the entire consignment on payment of duty. Adjudication proceedings can be taken & completed. M/s. Trio Import & Export Co. (P) Ltd. W.P. No. 1587/91 dt. 1-3-1991. Goods shall be released on (1) payment of duty, (2) payment of sum of Rs. 12 lakhs in respect of each Bill of Entry by way of cash, and (3) Execution of persona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that he had no information with him in this regard and he could not say whether indeed it was so. It was also pointed out to him that the respondent had also filed a Misc. Application in which they had given the work-sheet for the margin of profit and also submitted documents showing the sale of the goods in the Indian market at the relevant time at very high prices and that in regard to admissibility of this Misc. Application no counter had been filed by the applicants in regard to the facts and the documents set out in the Misc. application as to their correctness but only a general counter-affidavit has been filed regarding the admissibility of these documents which have a bearing on valuation. He, however, pleaded that he is opposing the admission of the said documents at this stage. He, however, stressed that no mens rea has been attributed for levy of the heavy penalties and cited the judgment in the case of Hindustan Steel Ltd. v. State of Orissa, reported in 1978 (2) E.L.T. (J 159) (SC) = AIR 1970 SC 253. The learned Advocate did not adduce any arguments in regard to the liability of the goods to confiscation under Section 111(b) etc. of the Customs Act but he pleaded t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tries owned by Shri Siraj have been held to be confiscable under Section 111(d) and Section 111(m) of the Customs Act for reasons of under-valuation of the goods and also for importation without a valid licence and provisions of Section 112(a) have been invoked against the two applicants for the levy of penalty. He pleaded that the levy of penalty of Rs. 16,00,000 on Shri Siraj is disproportionate and also the penalty of Rs. 2,00,000 on Shri Ramanan, who is only an employee, was too excessive and prayed for waiver or in the alternative reduction in the quantum. He, however, did not adduce any plea on the merits of the case and the plea, therefore, has to be considered on the ground of only financial hardship. The learned Advocate did not specifically state about the financial status of Shri Ramanan and stated that so far as Shri Siraj is concerned the position is reflected in the Balance Sheet filed in respect of other companies who are applicants before us in the respective Stay Applications. He, however, as mentioned earlier, did not refer to the assets owned by Shri Siraj or the sources of the funds or as to the sale proceeds realised from the sale of the goods imported by him a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven any reasons for levying very high penalties. He pleaded as it is according to the applicants the margin of profit at the relevant time was 34% and the penalty levied is totally disproportionate to the margin of profit as pleaded by the applicants. He further pointed out that in similar cases the Tribunal vide their order No. 272/91 ordered for pre-deposit of the penalty amount of about 50% of that levied by the learned lower authority in that case. He further pleaded that the learned lower authority has not given any findings on the margin of profit and cited the judgment reported in 1991 (51) E.L.T. 573. He further pleaded that the additional evidence now sought to be adduced by the Department through the Misc. Application is not admissible. We, however, stated specifically that they have not controverted the correctness of the documents filed indicating the sale price of the goods. He made a general plea that the goods had been sold at different prices and the highest price at any one point of time cannot be adopted as the basis for fixing the margin of profit. He, however, could not say whether the amount sought to be recovered in respect of the goods which have been held t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of consideration of the amount that can be ordered to be pre-deposited by the Tribunal. He pleaded that the applicants had resorted to the importation despite the fact that it had been held by the authorities below that the goods could not be imported by the applicants and the decision of the Tribunal in the case of M/s. M.K. Fisheries v. Collector of Customs. He pleaded that the applicants in total disregard of the legal position proceeded to import the goods as they hoped to reap a huge harvest from the goods imported. He further pleaded that it is nobody's case that the amount sought to be recovered by way of penalties, which covers both the redemption fine element and the penalty element, was more than the market value of the goods. He pleaded that the amount demanded is well within the parameters of Section 125 of the Customs Act. 7. We observe that in the present petitions in all the cases except in the case of M/s. Arasan Industries, the release of the goods had been ordered by the Hon'ble High Court on different terms. In some cases the release of the goods was ordered before the adjudication could be taken up while in others the release was ordered after the adjud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are not confiscable, the only plea for consideration is on financial hardship grounds. We observe that except M/s. M.P. Beer Products (P) Ltd., who are the Actual Users, others are all traders who have sold the goods after the release orders of the Hon'ble High Court barring the case of M/s. Arasan Industries whose goods have been confiscated and no court orders were obtained, and they have enjoyed the fruits of sale of the goods and the moneys received over the period would have been further utilised for generation of further business. In such a situation where the Government dues have not been paid no charitable view as such can be taken unless the applicants are able to establish with facts and figures about the financial hardship that they may suffer in case the amounts are asked to be pre-deposited. We observe that so far as Shri Siraj is concerned, he has set up a number of companies and imported Hop Extract and we had asked the learned Advocate on a few occasions when the matter was listed for hearing, for an affidavit to be filed regarding the sources of funds of the applicants and also amounts realised and utilisation of those amounts. No such affidavit has been filed an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avit while in fact, according to the Departmental authorities based on the evidence gathered by them, the margin of profit will be much higher. We, therefore, taking into consideration the pleas made by both sides and the facts and circumstances of each case order that on the applicants pre-depositing the following amounts towards penalty, the pre-deposit of the balance amounts shall stand dispensed with in each case pending disposal of the appeals : Applicants Pre-deposit M/s. Bombay Export International (C/Stay/336/91) Rs. 20,00,000 (Rs. Twenty lakhs) M/s. Bombay Export International (C/Stay/445/91) Rs. 5,00,000 (Rs. Five lakhs) M/s. M.P. Beer Products (P) Ltd. (C/Stay/446/91) Rs. 54,00,000 (Rs. Fifty-four lakhs) M/s. Usha Trading company (C/Stay/454 & 491/91) Rs. 56,00,000 (Rs. Fifty-six lakhs) M/s. Integrated Exports(C/Stay/248/91) Rs. 54,00,000 (Rs. Fifty-four lakhs) M/s. Trio import & Export Co. (P) Ltd. (C/Stay/372/91) Rs. 3,00,000 (Rs. Three lakhs) M/s. Trio Import & Export Co. (P) Ltd. (C/Stay/304/91) Rs. 42,00,000 (Rs. Fourty-two lakhs) Shri K. Siraj (C/Stay/168/92) Rs. 3,00,000 (Rs. Three lakhs) Shri R. Ramanan (C/Stay/169/92) Rs. 20,000 (Rs. Twenty t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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